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Can tech help drive your sustainability strategy?

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With both technology usage and sustainability moving up the business agenda, we explore the role technology can play in helping meet net zero targets.

“Technology has a significant and increasing carbon footprint, but at the same time, we know that technology can have ten-fold the impact in terms of helping reduce the carbon impact of our overall global production system,” says Dr James Robey, Global Head of Environmental Sustainability at Capgemini.

“We know from our own research, that sustainability is becoming a key priority for businesses,” adds Roland Emmans, Head of Technology at HSBC UK. “More than three-quarters (78%) of UK firms expect to grow sales over the next year as a result of their increased focus on sustainability. And 73% have plans to introduce net zero emissions goals to their own operations and across their supply chains. It’s an opportunity for businesses to differentiate themselves and frankly, if businesses aren’t doing it and aren’t sharing their actions, it can become a threat.”

Making a start on sustainability

The first step he says is for businesses to understand what their carbon impacts are and where they lie. “These can be anything from the carbon linked to the inputs of your production, your business travel, or your energy consumption,” agrees James. Getting a clear picture of these and a baseline case will enable you to plan and measure your progress towards net zero and understand how technology can help.

“Many of our customers are already starting to do this,” says Roland. “Among HSBC UK customers surveyed, we found that 28% are measuring their energy usage, 21% measure carbon emissions and 20% measure packaging materials and waste, but there’s clearly scope to do more.”

Taking that holistic overview can help you identify areas to tackle. “For Capgemini, leveraging collaboration technology to drive down emissions for business travel as part of our net zero commitment has been a priority which started well before the COVID-19 lockdowns,” explains James.

Where technology can support decarbonisation

“When it comes to reducing an organisation’s carbon footprint, technology can often contribute at different levels – we have a number of interesting examples and insights in two recent reports on this topic: Sustainable IT, and Sustainable Operations,” says James . “We typically look at carbon impact across three levels, which can then inform action.”

  1. Optimisation of the technology layer – “how businesses can reduce the carbon impact of the technology they are using to run their businesses,” explains James. “This could include everything from data centres and back-end systems to laptops and end user devices, together with all the communications infrastructure in between. Opportunities may include using server virtualisation through cloud computing, which can often reduce carbon emissions by between 60 and 80 percent, or it could involve transitioning from old to new technology hardware.”
  2. Operational layer – “how a business can apply technology to its operations to increase efficiency,” he says. “For example, implementing smart routing technology together with telematics to influence driver behaviour enabled a logistics organisation to save significant quantities of diesel, reducing carbon emissions.”
  3. Customer layer – “finally,” says James, “how businesses can use technology to make a difference for their own customers. This often enables significant impacts in carbon reduction, for example: supporting an energy company to deploy smart meters across its customer base can enable carbon reduction at scale.”

“Businesses shouldn’t underestimate the less tangible aspects of the business case for pursuing sustainability and the role technology can play in that.”

Dr James Robey | Global Head of Environmental Sustainability at Capgemini.

Securing the benefits of sustainability through technology

For businesses that may be unsure of the economic benefits of pursuing a sustainability strategy or of investing in technology to help achieve that, James points out that the business case is clear and becoming clearer. At the most basic level, the efficiencies linked to carbon reduction have a direct impact on lowering costs. Going beyond this, as regulation and stakeholder expectations grow, there are wider benefits for businesses in transitioning to net zero.

“There are some initiatives that have a straight economic payback, like switching to LED light bulbs,” says James. “But there are other initiatives which have slightly more nuanced payback. In the case of the logistics firm saving diesel, there was a direct cost benefit from employing a technology solution – every million litres saved equated to around one million euros of cost savings and 3,500-4,000 tonnes of carbon saving. In addition, there was less wear and tear on the vehicles reducing embedded carbon, fewer driver hours and less pollution.

“Businesses shouldn’t underestimate the less tangible aspects of the business case for pursuing sustainability and the role technology can play in that.”

The potential of innovation

Developments in technology are helping drive efficiencies that can support businesses as they transition to net zero and that are cost effective too, says Roland. “While LED bulbs pay for themselves within three to five years, we’re seeing an increasing number of our customers seeking to fund on-site renewable energy schemes, such as rooftop solar panels, which offer a reasonable payback period of around 10 years.”

While some of the benefits of using technology to drive sustainability can be felt across industries, such as using technology to understand energy consumption, others are sector specific. “Our recent report ‘Fit for Net-Zero' identifies a number of high impact climate technology projects, for instance, that can support the path to net zero across energy, buildings and construction, industry, transport, and food and land use,” says James, citing examples of service sector companies utilising cloud computing to optimise data centre emissions, manufacturing plants employing digital twinning to model and optimise environmental impacts, and the use of technology in building management to optimise power usage.

“Increasingly our offices are becoming smart buildings,” says Roland, “using sensors and machine-learning to regulate heating, for example, or to identify water leaks and automatically cut off the water to prevent building damage. And businesses are also considering the second-tier effects, so the move from CRT to flat screens reduced heat output dramatically, reducing the need to cool offices, for example.”

In the technology sector itself there are also huge strides being made, and this can have a significant impact on the overall business ecosystem, with many of these tech firms supplying services and solutions to a wide range of businesses. “With a little bit of thought and ingenuity, businesses are considering the broader effect of technology,” explains Roland. “One of our tech customers, for example, is taking part in a pilot scheme to convert energy released from data centres into clean energy for reuse. And, with businesses already benefiting from shifting their IT operations from inefficient on-site server cupboards to efficient, large-scale data centres, there can be huge potential gains when it comes to driving down their carbon footprint.”

A strategic imperative

It’s also, though, about understanding what’s important to your stakeholders, particularly now your employees and potential employees, and where you fit in the ecosystem of business. With many larger businesses already including sustainability targets for their suppliers as part of their own net zero commitments, businesses are increasingly seeing carbon reduction as a requirement of the tendering and procurement process. And similarly, medium and even smaller businesses are looking for transparency from their own suppliers, as customers expect more.

“Customers and suppliers are also asking – how are you provisioning for us and how will your strategy support our own sustainability target? That increases pressure and urgency on businesses to respond,” says James.

“Businesses should be reframing their view of sustainability, from a potential cost, to something that can increase profitability and efficiency, increase customer and employee satisfaction, and give them an edge,” says Roland. “Technology used appropriately can help you weaponise ESG to create a better business.” .