Environmental, Social & Governance3 min read

Earth Month: The Decarbonisation vs Digitisation Dilemma

Photo for Joe BaguleyJoe Baguley

April is World Earth Month, a time when millions of us pause to consider the state of our earth and what more we can do to protect it. For many in the tech sector, these reflections lead them to consider a dilemma inherent in modern business.

In every industry, organisations are on a digital transformation mission to ensure they remain viable and competitive. Companies are eagerly embracing revolutionary technologies—like blockchain, virtual reality, edge computing, machine learning and AI—as they pioneer new business models and keep pace with new trends.

But their increasing reliance on these computationally intensive technologies hinders their ability to reduce their carbon footprint. Although exact figures are debated, it’s accepted that the data centres that power digitalisation are significant consumers of global electricity and contribute as much carbon into the air as the aviation industry. And these emissions are predicted to double by 2025.

The tech industry therefore has a responsibility to help businesses decarbonize their operations while simultaneously harness the power of digital technology. With that in mind, here are four key areas where tech companies should be stepping up:

1. Intrinsic Sustainability from the Start

From energy-efficient coding onwards, sustainability should be a built-in characteristic of all new digital products and services. At VMware, we call this ‘intrinsic sustainability’. It’s an approach to design and development that ensures the energy consumption, carbon emissions, electronic waste, water usage and broader environmental impact for each product and service through its entire lifecycle is always considered. The fact is, it’s easier to build a more sustainable ecosystem from the start than to reverse engineer one at a later stage. Bitcoin for example is never going to be able to lower the carbon-intensity of crypto-mining—it’s baked into the system.

2. Push Sustainability through the Supply Chain

Every company is both a producer of goods or services, as well as a consumer of others’ products. That means every tech company has an opportunity to cause a positive chain reaction of sustainability through the supply chain, and hence help customers reduce their carbon footprint.

For example, some tech companies like VMware are adopting ‘responsible sourcing’ methods that demand sustainability from their suppliers. By building these requirements into contracts, sustainability is cascaded up the supply chain.

Similarly, if tech companies build sustainability into their own products and services, and demand sustainability from the partners selling their products, it has the same effect in the other direction. The goal should be a carbon-neutral supply chain.

Take for example the VMware Zero Carbon Committed Cloud partner Initiative. We connect customers looking for low-carbon services with cloud partners in the VMware ecosystem committed to powering their data centers with 100% renewable energy or to achieve carbon neutrality by 2030. In addition to helping our customers decarbonize their supply chain, it incentivizes other VMware cloud partners that haven’t already moved in a sustainable direction to do so.

3. Build Sustainability into Business Operations

To reduce the carbon footprint of the tech industry, we must all play our part in building environmental sustainability into our own global business practices and operations. At VMware, we’re committed to achieving net-zero for our own operations and supply chain by 2030 and we’re making great progress. 

For many IT companies like VMware, the goal is to decouple business growth from carbon emissions and resource consumption. This starts with understanding, monitoring and classifying an organisation’s carbon emissions.

Scope 1 emissions result from company-owned and controlled resources, like heating sources or vehicles. Scope 2 are emissions made indirectly by a business, mainly when the electricity it buys is being produced on its behalf. Scope 3, usually both the biggest and hardest to tackle, brings us back to the supply chain. These emissions are those the organisation is indirectly responsible for, from buying products from suppliers through to its products when customers use them.

Businesses are understandably progressing fastest to reducing Scope 1 and 2 which are in their control, for example by switching to renewable energy or electric vehicles. But they have less control on how Scope 3 emissions are addressed, which makes it harder to tackle. This is why organisations are rightly assigning the responsibility to the C-Suite. 

4. Move Forward Together as an Industry

Greater collaboration in the tech industry will accelerate the development of digital tools and technologies that can bring about dramatic change. For example, the European Green Digital Coalition (EGDC) is an initiative of nearly 40 IT companies including VMware and supported by the European Commission and the European Parliament. All members recognize that urgent action is needed, that solutions exist for a sustainable future and are committed to being part of these solutions and to lead by example.

The EDGC is looking initially to provide science-based methods that will help companies in power generation, construction, manufacturing, agricultural and transport sectors—as well as those developing solutions for smart cities—to estimate the net environmental impact of their digital solutions.

Despite climate concerns, the shift to digital is unstoppable. Tech companies must therefore lead the way in reducing the environmental impact of IT, and many chose Earth Month to unveil their latest initiatives. We must set our own ambitious targets. We must be more transparent, more collaborative, and more engaged with all our stakeholders and wider communities. If we all play our part, businesses and society will continue to reap the rewards of digital solutions while simultaneously supporting the battle against planetary warming.