Why the Communications Industry Needs ESG Action

As environmental, social, and governance (ESG) policies and regulations become more important for companies, the communications industry has an opportunity to be a sustainability leader. Digital technologies, like 5G and Internet of Things (IoT), which are directly tied to the communications industry, can reduce global emissions by up to 15%.

By taking sustainability initiatives seriously, you can help both the environment and your bottom line. We found that 78% of customers say a company’s environmental practices influence decisions about whether to buy from them. Furthermore, 66% of customers have stopped buying from a company whose values didn’t align with theirs.

Sustainability initiatives are important to investors, too. ESG policies and regulations are now key factors in assessing a company’s value and future success. When choosing which companies to back, investors want to know if a company is serious about ESG efforts, including emissions reduction and climate action.

Striving for sustainability

Learn how telecommunications companies are making a positive impact through technology like AI and machine learning.

A successful ESG strategy includes many environmental, social, and governance initiatives across an organization. Reducing emissions should be one important part of every comprehensive ESG strategy, and the communications industry can play a leading role in global decarbonization.  

The ICT industry, of which communications is a part, accounts for 3 to 4% of global CO2 emissions, about twice that of private and commercial flights in the world, annually. The vast majority of communications service providers (CSPs) recognize the large role the industry plays and are on board and ready to take accountability.  

Even without formal regulation (though that may be coming down the line), telecommunications companies have set robust emissions reduction and net zero goals, with 60 operators already disclosing their climate impact voluntarily. 

While achieving net zero emissions may be a challenge, it’s also an opportunity. 

Put sustainability at the core of your organization

Many companies are still using manual systems to measure their sustainability efforts. Finding more efficient ways to track, report, and reduce carbon emissions is critical. As more regulations focused on climate disclosure appear, companies need to find a way to automate these processes.

If you’re using disjointed spreadsheets and siloed systems to do this instead of a comprehensive automated system, reporting on ESG initiatives is not only more difficult, it’s less accurate. This makes showcasing your impact to investors, stakeholders, employees, and customers a bigger challenge.

Reducing emissions in line with science-based targets is necessary to avoid the worst impacts of climate change. To do this well, you should weave your sustainability efforts throughout your entire company. That means:

  • Every team, across every department should prioritize sustainability.
  • Delivery routes, product rollouts, and employee travel policies are made with sustainability goals in mind.
  • Customers, investors, and the public have access to your sustainability disclosures; this transparency helps you build trust with stakeholders.

What specific actions can you take to reduce emissions?  

Carbon emissions are categorized as scope 1, 2, and 3. You’ll need a way to track, manage, and analyze each of these scopes separately, while still being able to view all the data in one place. Having this capability allows you to properly track each scope according to its preset standards and garner insights to take meaningful action.

Scope 1 emissions, such as the environmental impact of field service trucks or the energy used to power your offices, are likely the smallest portion of your carbon footprint. By tracking these direct emissions, you can make changes like improving the efficiency of field operations by reducing truck rolls or better planning service calls, switching from diesel to electric vehicles, or using battery backup systems instead of diesel generators.

Scope 2 emissions result indirectly from purchasing energy and heat — essentially, the environmental impact of operating your actual network and associated IT systems. These types of emissions are already being reduced in the evolution from older 3G technology to 4G and 5G, and in the switch from legacy on-premises systems to more efficient cloud-based applications. Any additional increases in the energy efficiency will further reduce scope 2 emissions. 

Two-thirds of a telecommunications company’s total carbon emissions come from suppliers. That means that scope 3 emissions, or value chain emissions, make up the largest portion of your carbon footprint. Scope 3 emissions — which your company is responsible for to go net zero now — are not directly produced by your company, but rather by suppliers you work with. 

By tracking and managing your suppliers’ emissions, you can create business relationships that work toward reducing emissions overall and achieving common sustainability goals. Making sure your suppliers understand that you value reducing emissions can result in them sharing responsibility for purchasing renewable energy or reducing their own emissions in ways that result in reductions to your own scope 3 emissions.

You can also establish programs with phone and hardware providers that are already working on re-use, repair, and buy-back programs of equipment to reduce waste to increase the sustainability of your retail operations. 

For example, you might partner with a technology company to institute a program in which for every new phone bought at one of your retail locations, you commit to collecting and recycling an end-of-life mobile device in an underserved area. This not only helps the environment, it enables you to involve your consumers, demonstrate your commitment, and publicly cement your image as a brand that cares.

Make sure everyone is on the same page

Creating a company-wide initiative requires that everyone is working from the same dataset. Manual systems often produce inaccurate data and are difficult to search and manage, making accurate reporting almost impossible. 

Improving your technology for tracking sustainability goals can avoid an unfortunate scenario where you’re caught unprepared when new regulations emerge around how companies disclose ESG data. Relying on manual processes costs you both time and money — time your employees could (and should) be using to focus on more valuable tasks. 

To prepare, you need a centralized, comprehensive data platform that lets you track and manage sustainability across your entire organization. Having sustainability data management technology that unifies this information will integrate data from multiple sources, automate workflows, and report on key sustainability metrics to ensure data is auditable for investor and regulatory reports. 

And, because all internal and external information is in one location, you can reduce both costs and emissions — easily tracking, analyzing, and reporting on carbon emissions and waste management data across your business ecosystem, including up and down your value chain. 

Seize this historic opportunity to shape a better future

We know that sustainability efforts need to be front and center for businesses. Consumers demand it, and investors have confirmed that companies who follow best practices in ESG will be more successful and profitable in the long run. 

The communications industry has an opportunity to lead the way in our global fight against climate change. Streamlining processes, unlocking data, and turning insight into action will help you keep pace with sustainability goals, adhere to future regulations and face industry-wide challenges. 

Already, smart products and solutions from telecommunication companies are helping other industries reduce their carbon emissions. However, to truly lead this charge on a large scale, the industry needs to implement reporting tools that can make the data quantifiable, verifiable, and actionable. 

Doing this will make your organization a more efficient strategic partner and confirm your contribution toward global sustainability efforts.

Reduce costs and emissions all at once

We believe that business is the greatest platform for change, and success should be for everyone on Earth and the planet itself. Because the new frontier? It’s right here.

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