Why should tech companies make sustainability a priority for their business?
The emphasis on sustainability not only has a positive impact on the planet but also presents a huge economic opportunity. That’s why sustainability has, in recent years, emerged at the top of the corporate agenda, with both clients and employees choosing to partner with companies that have prioritised it.
Paying attention to environmental, social, and governance (ESG) concerns is critical for all organisations across all industries. And the technology sector is no different.
People Matters spoke to industry leaders on why sustainability should be made a priority for technology companies, why managing the green line has become an imperative and part of the strategy, what are organisations really doing when it comes to their ESG efforts, and if these are yielding desired results.
Tech business and sustainability : Why is it a win-win?
Technology has helped businesses move towards a better tomorrow - to innovate, to compete, and to win customers. However, now it’s time for technology companies to look beyond purely financial growth to achieve long-term, sustainable success and reimagine their responsibility towards the environment.
By going green, tech companies can play a significant role in correcting the effects of climate change using their resources and platform.
“This will help businesses contribute to two things: making the world greener and sustainable and secondly, it helps companies create an innovative culture, improve efficiency, competitive agility, employee engagement, and thus, drive growth,” says Kiran Marri, chief scientist at IT services and premium tech support solutions company CSS Corp.
Besides, it's not just the tech companies that aggressively implement sustainable and environmentally friendly business practices; it's also consumers who demand it.
According to the Economist Intelligence Unit, there has been a 71% rise in global online searches for sustainable goods over the past 5 years. Also, research by New York University's Stern Center for Sustainable Business has found that sustainable brands have increased their share of the US market during the pandemic.
“This trend isn't just in first-world countries or the FMCG industry; it's everywhere! Customers are engaging with sustainable businesses in ways that they previously ignored. While many consumers actively seek out brands and companies that align with their values, they're also willing to switch products/companies when something violates their ethics.
"These proof points are testament to the fact that sustainability is more important than ever today. Technology companies have a strong global reach and impact on people, hence they have a great opportunity to lead the way by incorporating sustainability into their core philosophy,” Marri adds.
Anjali Byce, chief human resource officer at STL-Sterlite Technologies says that the pledge to attain net-zero by 2050 has increased from barely 16% of the global economy in 2019 to over 70% currently.
“Technology companies are well-positioned to address this problem because of their extensive reach, social cohesion, and quick access to innovation and talent,” she adds.
According to Bloomberg, leading US digital companies are taking unprecedented steps to combat climate change. Many IT firms throughout the world have followed suit. Telecom and technology businesses play a critical part in this process.
Byce says: “By improving the efficiency of their company's operations and links with suppliers, they can lead the transition and demonstrate the way for emission reductions across the value chain.”
Environmental targets such as zero waste to landfills, water positivity, sustainable sourcing, green-labelled products, and net-zero emissions by 2030 are at the heart of STL's commitment to mitigating the threat of climate change, she says, adding that by 2030, they are looking to achieve water positivity.
“To enable the outcomes, our company conducted a complete carbon footprint study that covered 100% of its operations in India and would be expanded to global operations in the coming year,” she adds.
Saurabh Saxena, Intuit India site leader and vice president of product development says, that as companies seek to scale, create an impact and improve product quality on the back of emerging technologies, it’s especially important for them to ensure their practices, systems and processes catalyses this commitment.
“It is also critical to extend these efforts to their customers and communities around them. For example, Intuit aims to help 1 million US small businesses cut their carbon emissions by 50% by 2030. As a company we made a decade-long commitment to surpass carbon neutrality by 2 million metric tonnes, but we know we have to do more. Small businesses can use our marketplace to find win-win solutions and join us in our collective movement toward small business climate action,” he says.
Last year, Intuit India ensured that its employees were able to take advantage of climate-positive programmes, adding sustainability-related expenses, including purchases like e-bikes, solar panels and more to their annual Well-Being for Life Program, and providing reimbursements up to $1,000 for all related expenses. “In FY 2022, this benefit will increase to $1,300 for all employees,” he adds.
Suman Saraf, co-founder and CTO, now.gg, a mobile cloud gaming platform, says that technology companies are at the forefront of innovation and most well-equipped to influence climate change issues.
“So far, the industry has fared well when it comes to sustainability reporting but there’s need for more companies and industries to come together to intensify the efforts,” adds Saraf.
“We cannot have a future without sustainability. The cloud is revolutionising the IT industry in many ways. AWS says customers consume 77% fewer servers, and 84% less power and reduce carbon emissions by 88% by using the cloud, and there is no denying that its positive impact on the environment is just another one of its many positive attributes.
"We endeavour to make sustainable growth our key priority. Our cloud infrastructure works on the most energy-efficient instances that deliver the highest performance per watt of energy. Now.gg prefer to collaborate with data centres that are powered entirely by renewable energy. We hope that our smart decisions today will nurture a sustainable tomorrow," says Saraf.
Why managing the green line has become a part of business strategy?
Over the past 10 years, environmental issues have encroached on businesses' capacity to create value for customers, partners, and stakeholders. Managing climate-related risks and creating opportunities for business growth are intertwined, and tech companies understand that.
"Managing the green line is an imperative business approach for creating long-term value. As the expectations on corporate responsibility increase, and as transparency becomes more prevalent, having sustainable strategies in place is a 'must-have,' not a 'nice to have.' For the IT sector, the two major concerns are managing e-waste and reducing carbon footprint. At CSS Corp, we have implemented an effective carbon management strategy and sustainable business practices that help enrich our environment and not suffocate it,” says Marri.
As part of the digital initiative, CSS Corp has started to expand its capabilities to include website carbon neutral strategies and cater to the growing demand for sustainable services for existing and new clients.
“We have conducted extensive research work on assessing carbon scores of over 500 websites and analysed the factors that impact the scores, and devised optimisation approaches for greener websites. Besides, our efficient and sustainable practices helped us reduce GHG emissions by about 91%, prevented the axing of approximately 72 fully grown trees, reduced electricity consumption by 50,08,880 KW/hr, and disposed of 442kgs E-waste through authorised recyclers,” Marri adds.
Byce says: “Energy efficiency programmes can contribute to 40% of the entire global greenhouse gas reduction potential for less than Euro 600 per metric ton of CO2 equivalent. It's a very appealing investment that pays for itself over time while also lowering energy costs and increasing energy production in the economy. For long-term rewards, businesses should engage in green activities that cut emissions. According to the world population review, the CO2 emissions in India are at 2,411.73 MT as of 2022.”
Economically, organisations can save costs by implementing digital technologies with low consumption of power, substituting energy sources, and recycling as an effort to go green.
Beyond competitive advantage
Marri says it’s not a trend that any organisation would like to take advantage of but rather it is their natural responsibility.
The core value of ESG is being a responsible and trustworthy business, he says.
“At CSS Corp, there has been a strong encouragement to adopt agile working practices such as minimising commutes, which, in a way, influences reduction of carbon footprint. The awareness of mental health importance across different global centres have helped employees in fostering good work-life balance.
"ESG is a complex topic that has evolved rapidly in the last decade, and many concepts and themes have matured into standard practices. In the coming years, there are likely to be more mandatory demands from both consumers and end-users, and many organisations are actively working on adopting, acting more responsible and leverage technology to create sustainable outcomes,” he adds.