What’s changing faster than IT?


The trend to get ahead of

Faster than the progression of artificial intelligence (AI), there’s a business imperative that is already impacting the way of working. It’s not remote working or generative AI, and surprisingly, most IT companies have been slow to action it.

Perhaps this is because they believe it won’t impact them as much as other sectors. Maybe they just feel less responsibility? These beliefs will still not slow the trend.

The reality is that climate change and sustainability efforts are no longer just something for scientists and activists to focus on. They’re a very real threat to business as usual – or opportunity, depending on how you look at it.

Gartner lists sustainability among its top IT trends for 2024. Globally, governments are updating legislation to switch the responsibility of environmental impacts to commerce and industry. This goes beyond basic environmental, social and governance (ESG) reporting or buying carbon credits. In fact, aiming for net-zero is no longer enough because the impacts of planetary destruction are no longer subtle. As a result, the definition of sustainability is broadening.

Today we unpack why sustainability matters, how to avoid being accused of greenwashing, and what IT companies need to focus on to ensure they’re making a real and positive impact.

Real world view on IT and sustainability

IT has a reputation for being a fast-paced, forward-looking industry, but the number of IT companies extending this proactive approach to sustainability efforts are in the minority. Industry leaders talk of being carbon neutral and aiming for net-zero, yet for the average person, it’s a vague concept. That’s because what net-zero really means is not making things worse than pre-industrial times.

The problem is that planetary health has already deteriorated significantly. Not making it worse isn’t enough. Humanity now needs to focus on making it better than it’s been for the past 200 odd years.

Mission Impossible? Not when companies make a concerted and collective effort and start to focus on resource efficiency, regeneration and transitioning to a circular economy. The major stumbling block for this is that it requires a mindset change which starts with debunking a common myth:

Many in IT have the misconception that it’s a relatively “clean” industry compared to manufacturing. Technology may make modern life more convenient, but it comes at a cost. From sourcing to end of life, tech devices are bad news for the environment.

SOURCING: Every electronic device is made up of hundreds of components including many rare earth minerals. These minerals are often extracted from sensitive natural resources, resulting in their destruction. A way to stop this destruction is to extract minerals from discarded electronic devices instead of mining virgin resources and regenerate ecosystems in mined areas. There are more than enough materials already in circulation to meet demand, yet only 1% of these rare earth minerals are currently extracted and reprocessed.

SUPPLY CHAIN: Electronic components are shipped globally, emitting tons of greenhouse gases in the process. Transportation, whether by sea, air, or road, uses tons of fossil fuels and emits massive volumes of greenhouse gasses. This adds to the carbon footprint of products. To date, the approach has been to offset this using carbon credits. However, carbon credits have little real environmental impact. Most often they’re used to tick a box on the ESG scorecard.

REDUNDANCY: The tech industry prides itself on continual advancement, releasing new software and upgraded hardware almost on an annual basis. The downside is the growing pile of redundant machines and components that get written off. The statistics on global e-waste are alarming, made worse by the common perception that redundancy is simply part of the tech world. Older IT infrastructure is seen as risky, repair is seen as too expensive to be worthwhile and little consideration is given to where all this e-waste ends up or what should be done with it.

POWERING IT: The growing number of electronic devices has increased energy demand substantially. Even the cloud requires massive data centres that are hugely energy intensive. Some tech companies have been deliberate on leveraging renewable resources such as wind or solar energy, but the majority of tech is still powered by fossil fuels. Making technology more energy efficient needs to be a priority, as well a transitioning more fully to renewable energy sources.

Why sustainability needs to be an IT priority

The IT industry has in many ways contributed to many of the issues impacting sustainability. There’s a responsibility to take a different approach if sustainability is to become a priority.

As a start, understand some of the major international happenings that are likely to impact IT businesses in the future:

  1. At COP27, it was acknowledged that biodiversity loss is one of the major contributing factors to increasing extreme weather events. Mining rare earth minerals for tech components contributes to biodiversity loss.
  2. Exponentially growing waste volumes are also part of the problem as they’re polluting natural resources. Tech components are made up of plastic and metal, many of which are hazardous to dispose of and can pollute land and water sources if they end up in landfill.
  3. Negotiations for a global plastics treaty are currently underway. This is going to set a precedent for legislation on how plastic is produced, disposed of and reused. This will impact the production of new tech components, and how end-of-life components are managed.

While policy and legislative changes happen slowly, there’s little doubt that they’re going to impact business. Companies that start to expand their understanding of sustainability now will be better prepared for future industry impacts.

For example: Many of the legislation changes are geared towards End Producer Responsibility (EPR) which places the financial responsibility for recycling and repurposing materials with producers through taxes or levies. While this may not directly impact IT service providers, it’s inevitable that these costs will filter down the supply chain to consumers which will affect IT budgets.

The general consensus is that achieving sustainability requires a transition to a circular economy. This promotes, re-use, repair, repurposing and recycling to retain existing resources, rather than generating or extracting more virgin resources and simply disposing of waste. Conceptually, the circular economy is relatively simple, but practically it requires a fundamental shift away from the industrial mindset that’s become the accepted norm for the past 200 years.

Material sourcing needs to change, manufacturing processes need to become more efficient, and approaches to repair and replacement need to be carefully considered. All of these changes can be more effective when made in collaboration with other industry partners. This is needed to maximize opportunities and efficiencies when implementing sustainability and circular economy initiatives.

How IT service providers can be part of the solution

For the majority of businesses, the focus on sustainability is relatively new. In some sectors it’s being driven by regulatory reporting requirements rather than values. There is an inherent risk in this and carbon offsets are a prime example. Unless there’s an audit trail linking the carbon credits to real impact, companies can be found to be non-compliant and guilty of greenwashing. This was recently the case for several major European airlines that were found guilty of misleading carbon offset claims.

For IT service providers, there’s an opportunity to lead the way and be able to guide clients through the complexity involved in becoming more sustainable. This requires understanding the core principles and definitions of sustainability, as well as regulatory reporting requirements, and which solutions are proving to be the most effective.

A key element of providing value to customers is helping them understand why regeneration should be the focus of sustainability instead of carbon. This can lead to more efficiencies in the longer term and will naturally lead to greater levels of compliance.

Many tools and technologies already exist to support sustainability efforts. These include resources on reporting requirements and sustainability best practices, as well as reporting tools that link efforts to impact.

One of the most effective ways to promote sustainability is to focus on building partnerships with businesses in the resource and waste management sector. This will enable managed service providers (MSPs) to provide practical support to customers.

For example: implementing take back schemes as part of IT infrastructure upgrades. In partnering with companies that process e-waste, there might be the possibility that companies can earn credits. Alternatively, there’s the possibility to partner with educational NPOs that refurbish older PCs and use them to help people gain tech skills. This can help companies improve their ESG scores in terms of both social and environmental initiatives.

Sustainability as a focus for 2024

The general business view in terms of sustainability is that 2024 is a year for action. There have been many promises made and targets set over the past few years, now this needs to translate into tangible impact.

This is necessary for multiple reasons: Regulatory changes may be driving sustainability initiatives, but customers have a growing awareness of sustainability that’s affecting their buying choices and brand loyalty. Companies are realising that genuine sustainability efforts can help drive growth, but due to the complexity in becoming more sustainable, they need support.

IT service providers are ideally positioned to be able to provide this support through their technical knowledge coupled with industry partnerships. There’s a strong opportunity to be part of the solution and lead the way towards a more sustainable future.

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