In 2009, sustainability will face its biggest test yet. Ten years ago in Kyoto, Japan, world leaders, economists and environmental experts hammered out a deal on carbon emissions.
That was roughly halfway into the “nice” decade (non-inflationary, continuous expansion), and the world was beginning to believe that the boom and bust cycle had been crushed. Under such conditions, it made sense to focus on higher goals, such as ways to produce goods and services without long-term harm to the environment. Under these conditions, sustainability moved into the mainstream.
But what will world leaders, economists and environmental experts think in November, when they arrive at the UN climate change conference in Copenhagen to discuss Kyoto’s successor? For many stakeholders, support for environment-friendly policymaking, investment and purchasing will seem anachronistic under the glare of today’s financial pressures.
In fact, two things will happen in 2009 that will rescue, and then reassert, the case for sustainability. The first will be a subtle shift in the definition of the concept. Sustainability has been linked to environmentalism rather than the hard-headed commercial world. Organizations have been accused of “green washing”, or turning eye-catching but superfluous schemes into proof that they have strong sustainability credentials. In fact, sustainability is as much about commercial pressures as environmental ones, and now companies must try to achieve both.
Information technology (IT) and telecom organizations have led the way in showing how environmental and commercial needs can be aligned. They can calculate their carbon impact with relative ease, since most of their emissions come from running their networks. Indeed, in a world of high energy prices, it makes hard-nosed financial sense to reduce energy usage. So when British Telecom (BT) stated it would reduce its carbon emissions by 80% across the globe by 2020, it was making as much a claim about bottom line performance as about saving the planet— a sustainability win-win.
The picture is by no means exclusively rosy among information and communication technology vendors, as a recent survey by Gartner and the World Wildlife Fund showed. An in-depth analysis of some of the world’s largest IT and telecom organizations found a mixed picture. Fujitsu, BT, HP and IBM did well in almost every category, unlike Wipro, Nortel, Verizon, China Mobile and Lenovo. There were some surprises, as Google showed room for improvement on basic environmental practices, supply chain and solutions for a low carbon economy. Also interesting was the fact that two companies— China Mobile and Lenovo—demonstrated China’s growing commitment to sustainability.
The other thing that will mark out 2009—perhaps counterintuitively—will be the high level of commitment to new, financially astute sustainability. Although shareholders will be more critical of projects that look costly, reducing an organization’s investment in sustainability will not necessarily look that appealing, as it falls foul of a wider set of stakeholders. These will include governments, which will happily support a sustainability agenda—especially where companies are asking for financial help—through pressure groups that remain vigilant, to employees who to want to work for companies with demonstrable “values”.
Under the twin pressures of financial performance and commitment to sustainability, global corporations in 2009 will find new ways to link these agenda. This is where IT and telecom companies can add value by reducing the carbon footprint of an organization’s communications infrastructure, enabling collaboration among a dispersed workforce, and boosting innovation.
The trend towards better networked companies brings the chance to allow people from across an organization to collaborate in real time over secure networks. While organizations have enabled research and management teams to work remotely for some time, the need to do more of it and to do it smarter has never been greater. However, while these decisions may now be purely commercial—the environmental benefits that fall out of this way of working will be significant.
This need to focus on finding better and more sustainable ways of working is born out by a white paper sponsored by BT and Cisco. They found that if the board of directors is held accountable to a wider set of goals, including the community and the environment, it will both support profitable growth and boost innovation. The analogy is the emergence of the Internet in the early 1990s. It was deemed at first an academic tool, then a consumer plaything, before it began seriously to have a disruptive influence on even the most traditional firms and organizations. Ultimately, it provided the infrastructure and mindset that have driven commercial success as fast as anything since the industrial revolution.
The challenge for 2009 will be for organizations dealing with the financial climate to ensure they do not do so at the expense of the planet’s climate. The winners in the next economic upturn will be those corporations that embraced sustainability as a framework to drive financial success during the downturn. And the biggest winner of such innovative thinking might just be the successor to the Kyoto Protocol.
Arun Seth is chairman, BT India. Comments are welcome at email@example.com