The tech sector requires support from a variety of key stakeholders to become greener
The penny has dropped regarding sustainability across the tech sector. According to the ‘How Sustainable is Tech?’ report by iResearch Services, based on a survey of 550 executives across 11 countries conducted during the lead-up to COP26, 89% of tech companies say it is important to be seen as a sustainable and ethical brand. And the same percentage of respondents believe sustainability is important when choosing a new employer.
These figures are encouragingly high. However, it’s worth underlining that what they refer to is largely aspirational. There is often a significant gap between stated sustainability ambitions and the actual situation when viewed in the cold light of day.
What then does the tech industry need to do to become more sustainable? Does it require substantial external support?
Categorically yes, in the view of Russ Shaw, CBE, Founder of Tech London Advocates and Global Tech Advocates, argues that more government support and financial incentives are required. “We need to champion our green tech ecosystem, and we require assistance from a variety of key stakeholders,” he says.
“Governments have a crucial role to play in supporting businesses committed to tackling the colossal challenge of climate change – this could include support for R&D funding and tax credits for ClimateTech and CleanTech, as well as the continuation of EIS and SEIS to encourage early-stage investment. At the same time, we also need businesses and investors to take responsibility for driving ESG agendas within their organisations.”
In December 2021, the UK government announced plans to invest £116m in green-tech businesses as part of its efforts to increase the energy efficiency of houses and decarbonise the economy. Relatively speaking, this funding from the Department for Business, Energy and Industrial Strategy (BEIS) is a mere drop in the ocean. Once the dust settles on the Conservative Party leadership contest and a new Prime Minister is in office, it will be interesting to see whether there is a shift in priority with regard to government support of sustainable technology.
Where else might support come from?
iResearch Services ‘How Sustainable is Tech?’ research also pointed to the need for more intra-industry collaboration, with 49% of respondents saying the industry must work together to become more sustainable. Another popular suggestion for a source of support is corporate clients (40%), followed by policymakers (37%).
Tech titans such as Amazon and Microsoft have large climate innovation funds, as does the European Commission. And there is a whole host of incubators and accelerators with specific expertise in supporting ‘eco-preneurs’ and other businesses with sound green tech credentials.
For those with sizeable budgets, the heavy hitters of the consultancy world may be an option in terms of bringing plans to fruition. McKinsey claims to have helped 1,700 clients with sustainability projects in just three years and launched its McKinsey Platform for Climate Technologies (MPCT) to help with the planning, execution and scaling up of critical sustainable technologies. Boston Consulting Group has a 550-strong global team active in areas such as climate innovation, technology and growth, and sustainability strategy and transformation. There are numerous other consultancies in this space.
Common challenges, but no walk in the park
No two tech businesses are identical; they differ inf scale, culture, market focus or growth objectives. Yet when analysed through a sustainability lens, many face common challenges.
While the importance of being seen as sustainable and ethical is almost universally accepted by business leaders in the sector, effecting the change required to make this happen is no walk in the park.
Cost is the number one stumbling block. The ‘How Sustainable is Tech?’ respondents put this ahead of speed to market and lack of resources as the biggest hindrance to becoming a more sustainable business. It is indicative of the scale of the challenge that 60% of the respondents in the US consider prohibitive costs to be the main barrier to sustainability, followed by 55% in APAC.
When slicing up the data by job role, we see that 48% of CEOs identify cost as the greatest barrier. 56% of people picked cost at the Operations and Development level.
There is an undeniable opportunity for technology to be a force for good and create sustainable change, through dedicated industry partnerships and sector-wide collaborations. We see enormous potential for technology to help create more accessible and inclusive workplaces across sectors and geographies, but only if the right investment, infrastructure, partnerships and employees are in place to rise to the challenge and implement the changes needed.
The research highlights significant gaps in investment and action on sustainability initiatives, which must be addressed to bring about meaningful change. Will the tech sector answer the call?Back to Blogs