31 August 2023
Global transport, manufacturing and powering and heating buildings regularly crop up when discussing environmental impact, prompting businesses to do more to tackle climate change. Yet, the role of enterprise technology is often neglected. Keith Ali, MD at Creative ITC, explains how smarter IT decisions and working practices can be applied for ESG success.
Business leaders across all industry sectors recognise they have an important role to play as we strive to create a lower carbon future. There’s renewed focus on tackling environmental issues with companies in 166 countries committing to align their strategies and operations with global goals as part of the UN Global Compact.
There’s mounting pressure from all sides. Over 60% of organisations say they are under growing pressure from customers to maintain ESG credentials. Companies are starting to see the increased financial risk of poor ESG performance too, with 42% feeling the weight from shareholders. Half (49%) of investors say they would divest from companies that weren’t taking sufficient action to tackle climate change.
Sustainability laws are starting to bite too. Last year, two disclosure laws mandated ESG reporting for all listed UK companies with over 500 employees or annual turnovers exceeding £500 million. Similarly, in Europe the Non-Financial Reporting Directive (NFRD) is being extended to meet new standards, while the US Securities and Exchange Commission has also proposed climate-risk disclosures be added to annual reporting requirements for publicly traded companies.
The message is clear. Stakeholders are increasingly seeing through empty environmental claims and greenwashing tactics such as organisations hiding behind carbon offsetting claims. They expect firms to provide robust evidence of the benefits of their ESG policies. What’s needed is widespread action to make a tangible difference.
Smarter IT choices hold the key
One area that is often overlooked in the race to net zero is the role of enterprise IT. Worryingly, enterprise technology still accounts for about 1% of global emissions – equal to half of all emissions from aviation and shipping worldwide and the same amount generated by the whole of the UK. Widespread use of power-hungry PCs that fail to maximise renewable energy sources don’t help. Those issues become compounded if they run on outdated IT infrastructure.
So, what can IT, network and data centre professionals do to accelerate change and fast-track ESG goals?
Most importantly, it’s about understanding that greener IT is not simply about rationalising infrastructure to reduce carbon footprints. Creating a low carbon company also means adopting new attitudes, more efficient working methods, and smarter solutions. Fortunately, there are some sustainable approaches IT managers can take that will have a positive impact on their organisation’s ESG scores.
1. Empowering flexible workers with virtual desktops
Environmentally-friendly Desktop-as-a-Service (DaaS) solutions not only boost workforce productivity and mobility, but also support companies’ sustainability aims. One such solution, VDIPOD, is hosted from data centres operating on 100% renewable energy. Users consume 81.7% less energy with an 89% renewable power model at source and CO₂eq reduction of up to 43%. Other benefits include metrics and an audit trail to simplify ESG reporting.
One international architecture studio has achieved a 90% reduction in kilowatt hours per person and a three-fold increase in renewable power use since deploying VDIPOD to over 400 employees.
2. Switching to energy-efficient data centres
It’s always a good idea to review hosting arrangements and with climate change concerns rising, IT decision makers can make smarter environmental choices about where and how to host their data and services.
Upgrading on premise infrastructure to meet modern environmental targets is out of reach for most firms, leading many to transition to the cloud. As hyperscalers come under fire for poor resource utilisation and environmental controls, smaller cloud providers can be a better option. Creative’s private cloud solutions are hosted from Equinix-powered data centres, which operate on 100% clean, renewable energy and are optimised to achieve a power usage effectiveness ratio of c. 1.2 versus an industry average of 1.8.
Global engineering company SNC-Lavalin is working with Creative ITC to reduce its global data centres from 16 down to three. "Among the biggest benefits we've already seen in our carbon footprint are 69% less storage, 53% less electricity and 45% less floorspace," said Steve Capper, Group CIO of SNC-Lavalin.
3. Deploying Infrastructure-as-a-Service models
Savvy IT leaders are moving to a fully managed IaaS model delivered by an MSP, meaning infrastructure responsibility, power consumption and carbon footprint transfer to the service provider. Eliminating the need to manage on-prem technology, businesses benefit from decreased energy consumption, cooling costs, and waste from decommissioned equipment. Private cloud providers can also further improve ESG scores by utilising virtual machines and containers to reduce data centre server numbers.
Strong ESG performance equals greater business benefits
The connection between ESG aims and business value is clear, with growing evidence that corporate ESG initiatives create business value, profits, and opportunities. Along with operational and financial gains sustainable firms outperform others on EBITDA and profitability, enjoying increased productivity, top-line growth and lower costs. Other potential benefits for publicly owned companies include reduced downside risk, greater equity returns and higher credit ratings.
Keeping these benefits front of mind will help business and IT leaders drive transformation within their organisations that will not only accelerate their journey to a lower carbon future but will also support and support future success – for their firm’s future success and that of the planet as a whole.