Digital technology is crucial to achieving important goals that include fulfilling compliance requirements, meeting the reporting needs of stakeholders, and implementing operational changes within an organization to meet environmental, social, and governance (ESG) and sustainability targets.
The global push to achieve the 2050 net-zero target has resulted in an increased awareness of the role of IT in accelerating sustainability. According to the EY Reimagining Industry Futures Study 2023, which was based on an online survey of 5G perceptions among 1,325 enterprises worldwide, 54% of businesses believe that emerging technologies can play a vital role in this effort.
The Exponential Roadmap 1.5.1, developed by the Exponential Roadmap Initiative, an accredited partner of the United Nations’ Race to Zero campaign, outlines a path to reach net zero emissions from businesses by 2030 through natural climate solutions. The information and communications technology (ICT) sector has the potential to reduce global carbon emissions by 15% and 35% directly and indirectly by 2030.
While the use of digital technology is crucial for sustainability, it is equally important to prevent it from becoming a major contributor to global emissions. The adoption of new technologies could lead to increased energy consumption, hindering progress towards emission reduction targets.
THE NEED FOR GREEN IT
Green IT refers to IT products and services that help organizations reduce their environmental impact, such as the issue of IT energy consumption. For example, the International Energy Agency says that data centers and data transmission networks were responsible for nearly 1% of energy-related GHG emissions in 2020. Green software, which incorporates low-carbon principles in software development and utilization, is also an important green IT practice. While the software itself does not emit carbon, it influences energy consumption.
E-waste already poses environmental risks due to hazardous substances that include mercury, lead, and cadmium, which are capable of contaminating air, water, and soil. E-waste disposal adds to the ICT sector’s greenhouse gas emissions. In 2019, there were 53.6 million tons of e-waste, which could rise to 74.7 million tons by 2030, according to Statista. In addition, the mining and extraction of these materials further contribute to soil erosion and deforestation, emphasizing the need for effective material reuse and waste processing.
The ICT sector can innovate green IT and maintain a net positive impact by implementing sustainable practices throughout its value chain, covering energy efficiency and sustainable supply chains.
Furthermore, organizations can drive the positive impact of green IT and software by fostering an ecosystem of collaboration among stakeholders in the value chain, involving the following key players in the mix: technology providers, technology buyers, governments and other regulatory authorities.
TECHNOLOGY PROVIDERS
Technology companies, ranging from global leaders to startups, are actively increasing their focus on green IT innovation and offerings to meet the growing demand and expectations in the market. As they do so, they have the responsibility to manage and disclose their carbon footprints to comply with regulatory requirements and standards, encompassing scope 1 to scope 3 emissions that result from the production and use of their technologies.
Industry groups consisting of technology providers are in a favorable position to establish standards and best practices within the sector, like prioritizing energy-efficient hardware, e-waste management, and the sustainable procurement of IT equipment. Additionally, they can proactively collaborate with governments to develop policies that promote the adoption of green IT.
In the Philippines, a related law is the Renewable Energy Act of 2008, which encourages the adoption of energy-efficient technologies across various sectors. There is a need for more local green-IT-specific laws or policies. Accordingly, the country would benefit from formal studies identifying green IT-related gaps and opportunities. Technology providers can incorporate green IT principles into their product and service designs to reshape the future of the IT landscape, positively impacting society and the environment.
TECHNOLOGY BUYERS
As sustainability becomes a central part of an organization’s core strategies, companies are actively seeking suitable technologies, digital platforms, and applications to support their sustainability and ESG goals. While their main focus is on selecting technologies that meet sustainability requirements and tackle sustainability challenges, it is crucial for them to also consider the potential environmental impact of implementing these technologies on a larger scale.
Forward-thinking and innovative companies that prioritize sustainability in their business strategies include green IT implementation in their roadmap for sustainability transformation. They must integrate green IT principles into a robust and sustainable sourcing and procurement framework while carefully choosing technology providers from the request for proposal process onwards. They may even take the extra step of adopting an internal carbon pricing mechanism to ensure that strategic decisions align with their climate ambitions. By generating market demand for green IT, these companies can drive innovation in future green IT landscapes.
GOVERNMENTS AND OTHER REGULATORY AUTHORITIES
Government and regulatory authorities also play a crucial role in driving the adoption of green IT to accelerate the transition to a sustainable future, keeping in mind the following priorities:
• Provide detailed action plans with clear accountability.
• Improve the design and implementation of green initiatives.
• Incentivize the market and implement mandatory changes.
• Increase funding to promote innovation.
• Serve as a role model for other sectors of the economy.
• Promote a people-centered approach involving the whole of society.
Governments that have mature regulations and standards for sustainability can take the lead in implementing strategies within their organizations and departments. For instance, the United Nations, through its specialized agency, the International Telecommunication Union (ITU), establishes standards, guidance, and criteria for ICT organizations on setting net zero targets and strategies.
THE SIGNIFICANCE OF GREEN IT
The adoption of green IT and software by both organizations and societies will have a significant bearing on global sustainability ambitions. By nurturing a collaborative system of stakeholders within the value chain, organizations can benefit greatly from green IT and software.
This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the author and do not necessarily represent the views of SGV & Co.
Joseph Ian M. Canlas is a consulting partner and part of the Climate Change and Sustainability Services team of SGV & Co.
