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Sustainability Services
Ecosystem-led Approach to Power Your Sustainability Strategy
Highlights
- With increased public awareness of climate change and societal pressure to tackle its causes, European firms can no longer just pay lip service to sustainability.
- One of the biggest challenges for companies, as they start on their sustainability journey, is developing a business and systems integration mindset.
- When a company’s ecosystem includes hundreds or even thousands of partners, AI could massively simplify what have previously been highly complex scope 3 assessments.
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Sustainability is business critical
Across Europe, entire industries and organisations face the challenge of building sustainability into their strategies.
It’s no longer enough to simply be a profitable business. Companies must tread lightly on the planet, its resources and society, and those that don’t will struggle to compete with those that do. We are at the dawn of the sustainable enterprise.
European firms can no longer just pay lip service to sustainability. Not only is there increased public awareness of climate change and societal pressure to tackle its causes, but regulators are also responding with laws to ensure businesses and financial institutions play their role in Europe reaching its climate targets.
As a result, organisations will need to comply with sweeping proposals under the European Green Deal, and with legally binding plans to reduce harmful emissions by 55% by 2030 and advance a Just Transition.
Taken together, these developments constitute serious challenges for organisations that are yet to introduce comprehensive sustainability strategies.
They are likely to struggle to attract talent, as employees are now laser-focused on companies’ environmental and social credentials and values.
Then there is the fact that sustainability can have considerable benefits for a company’s bottom line, not just the environment. For example, reduced energy usage does not just lower emissions, it also lowers costs and, by inference, boosts profits.
Without a pervasive sustainability strategy, companies will not be able to build greater futures for themselves, society, or the planet. Technology will be critical to supporting both the implementation of these strategies and monitoring compliance.
Sustainability at the heart of the digital transformation
Legislators view the digital transformation of businesses in Europe as a key pathway to decarbonisation.
The EU’s proposals for Europe’s digital future place sustainability at the heart of technological transformation.
The impact digitalisation and automation can have across different sectors is varied, but the gains for both business and the environment are well documented.
While technology companies may appear to have an inherent advantage because they are already highly digitalised, it’s important to acknowledge that even digital technologies can differ in their respective environmental impact. What’s more, no two organisations—digital natives or not—are the same. What works positively in one setting may be unsuitable in another.
“Successfully rolling out a sustainable digital transformation demands a rigorous approach that can go beyond the capabilities and resources of the organisation itself,” explains Eugenio Longo, Sustainability Director, TCS Europe.
Engaging a strong and experienced transformation partner can therefore be vital to success.
An ecosystem mindset
For businesses embedding their sustainability strategies, applying a holistic approach will be the key.
One of the biggest challenges for companies, as they start on this journey, is developing a business and systems integration mindset.
Working in silos means they will find it harder to implement sustainability throughout the organization. Overcoming these internal frontiers must also extend to IT systems to enable wide-reaching data mining and processing.
This holistic approach to business, IT and sustainability must critically extend beyond the boundaries of the organisation itself and include the entire ecosystem.
For example, for emission reporting, the Greenhouse Gas Protocol differentiates between scope 1 emissions, which encompass the organisation’s direct emissions, scope 2, which are those an organisation incurs indirectly, such as by purchasing electricity made from fossil fuels, and scope 3, which relate to the supply chain.
To cover all three areas, the company must understand climate and ESG-related impacts across the entire value chain.
IT and AI are the ‘control tower’ of the organization
Managing the ensuing complexity will vitally rely on IT infrastructure — supported by AI.
Capturing the necessary insights through data, connecting the dots across the ecosystem, and acting on them will require effective governance.
“IT infrastructure will become more and more the governance tool of companies and their ecosystems,” highlights Longo. “It will be the neural network of the enterprise, its control tower.”
He points to solutions such as digital twins that enable scenario modelling to help monitor and benchmark an organization’s ecosystem. And there is also a growing role for AI.
“If you need to understand the sustainability of your supply chain, you can use AI to do so, for instance by crawling annual reports, analysing the information and harmonizing the data,” Longo points out.
When a company’s ecosystem includes hundreds or even thousands of partners, AI could massively simplify what have previously been highly complex scope 3 assessments.
Longo stresses that there is no one-off fix but that organizations must adopt a flexible and dynamic approach. This will benefit their sustainability efforts and enable them to pivot more quickly as the market environment changes.
Sustainable business—the defining challenge
The joint challenge of reining in climate change and building greater futures for businesses has become a defining issue of our time.
It’s abundantly clear that achieving this goal goes far beyond the capabilities of any single sector, be that government or industry.
As joint stakeholders, we will have to pool our political, business, and intellectual capital to build the sustainable world we all want to see.
Successful digital transformation will play a major role in our sustainable future. At TCS, we’ve built a strategy to help European organizations live up to the vital part they must play in building a greater future for the region. Working together like this is the only way we can make sustainability a reality.