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.