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As we move further into 2022, and the first few locations across the world show signs that the pandemic might be easing, many organisations have an opportunity to refocus on core strategic goals and aims. For the tech sector, one of these must be sustainability
- Chris Tilley, CFO, Harvey Nash Group
Published: 08 Mar 2022
Without doubt, the climate agenda has intensified in recent times, culminating in the COP26 conference in Glasgow last November. Whether you see the conference as a success, a disappointment or something in between, it cemented climate change and climate risk as a key issue for our times and increased the sense of urgency for action.
That urgency will manifest itself in governments around the world forcing businesses towards more sustainable behaviour, as well as more comprehensive and transparent reporting. This will be complemented by increasing scrutiny and pressure from businesses’ key stakeholders – ranging from shareholders, analysts and rating agencies to regulators, customers and staff.
The fact is that while many tech businesses, including especially the Silicon Valley giants, have put significant sustainability goals at the heart of their future vision, others are yet to make significant inroads in the journey towards net zero.
We saw evidence of this in last year’s Harvey Nash Group Digital leadership report – the sustainability agenda was second from bottom in boards’ priorities for their technology teams. More than half of the digital leaders we surveyed say their businesses are using technology to reduce travel and improve operational efficiencies, which is encouraging – but less than a quarter are focused on improving the carbon footprint of technology itself.
This needs to change – and I think it already is. Certainly the carbon and wider environmental, social and governance (ESG) agenda is something that comes up more and more frequently in conversation with clients. It is on tech leaders’ minds. More businesses are also appointing specific leads to drive the sustainability ambition, such as sustainability directors or chief sustainability officers.
Scoping your footprint, prioritising actions
For all tech businesses, the process is going to be a journey. It’s one we’re on ourselves at Harvey Nash Group, having recently published our Sustainability report and set net-zero targets, which we have begun working towards. So, what have we learned so far?
Firstly, you can’t tackle an issue if you don’t know how big it is. So the key foundational step is to measure and quantify your Scope 1-3 carbon emissions. Scope 1 covers direct emissions from owned or controlled sources, such as by running boilers or vehicles; Scope 2 covers indirect emissions from the generation of purchased electricity, heating and cooling consumed by a company; and Scope 3 includes all other indirect emissions that occur in a company’s value chain – purchased goods and services, waste disposal, etc.
Undoubtedly, it is quantifying and then tackling Scope 3 that is the biggest challenge. To compile our footprint, we put together a working group with representatives from every team and geography in the group, so we could gather all the data needed. This group will remain key going forward as we track the difference that our measures are making.
Secondly, prioritise actions that will have the biggest impact. For most technology businesses, energy consumption will be a significant driver of the carbon footprint. So ask yourself: how are you hosting your data? Worldwide, datacentres are estimated to consume 200TWh of electricity a year. Does your datacentre provider run its facilities on renewable electricity? This is a critical piece in reducing IT-related carbon emissions.
We have moved all our hosting across the group to Microsoft Azure – as well as security and cost factors, Microsoft’s commitment to shifting to a 100% renewable energy supply by 2025 was a key part of our decision.
Then there are the suppliers of electricity and power for your offices and operations. At Harvey Nash Group, we are beginning the process of switching to renewable energy providers across our businesses. With energy costs volatile and rising, severing the fossil-fuel reliance and moving to sustainable sources makes good sense.
Buy-in and communication
Thirdly, sustainability has got to be a live issue at board level. So whoever is taking the lead on sustainability in your organisation – whether it’s the CFO, COO, CIO or a sustainability specialist – they must have the ear and the buy-in of the board to drive real change across the business.
Finally, sustainability can’t be something that is siloed within one department. It’s got to be shared and communicated throughout the organisation. There has to be a real cultural commitment. That shouldn’t be hard, because it’s a topic that really matters to increasing numbers of people.
Small measures can help boost this as well – for example, we have begun an initiative whereby we fund the planting of one square metre of seagrass (a superb absorber of carbon) for every new joiner to the group.
But making sure that everyone understands where you are on the journey and what is coming next is more difficult to get to. So, have a clear plan and keep communicating it. Celebrate successes and keep the momentum going.
The days when sustainability was an offshoot of the CSR programme are gone. It’s now a critical strategic topic that matters to key stakeholders. The tech sector is recognising this and can make significant strides forward on the path to net zero.
Harvey Nash’s Digital leadership report is available here (requires registration).
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