Friday, 27 January 2012

Sustainability may be on the corporate agenda, but most companies still don’t know what carbon counting is

A couple of reports published this week give contrasting views of the extent to which companies are addressing sustainability and their carbon footprints.

The latest annual ‘Sustainability & Innovation Global Executive Study’ from The Boston Consulting Group and MIT Sloan Management Review is based on survey responses from 3,000 managers from 113 countries. In the responses, 70% of executives said that their companies have made sustainability a permanent fixture on the management agenda.


Sustainability seems to be gaining ground, with two thirds reporting that it’s necessary to being competitive, up from 55% in the previous survey. Nearly a third also said that sustainability contributes to profitability. Nevertheless, the survey showed there is still a long way to go. Sustainability may be on management agendas, but the responses indicate that it’s the eighth item behind various other more important considerations.

In contrast, US ERP software company Epicor Software has announced the results of its global carbon accounting survey, which finds that most companies are still lagging in their comprehension of carbon accounting as a whole. The survey was of nearly 1,000 companies worldwide, but with quite a large proportion (43%) from organisations with $50m revenue or less. There was also a strong emphasis on manufacturing companies (48%).

But the top level finding is that 58% of companies surveyed had not heard of the term ‘carbon accounting’. Less than a quarter could accurately describe what the term means and 80% don’t monitor their company’s carbon footprint. The survey also revealed that although the CEO is the most likely person to be responsible for a company’s green strategy, 50% of companies surveyed don’t have any C-level involvement at all in their carbon accounting initiatives.


OK, so these surveys are very different in terms of who and what they cover and the way they are reported (for example, for Epicor 48% is a majority) but I believe there is an interesting point here.

Sustainability is increasingly on the corporate agenda, led by larger companies. It’s nowhere near the top of the agenda and it’s not clear what aspects of sustainability are being discussed - economic sustainability was the most common aspect according to the survey responses. A lot of companies globally have yet to discuss carbon accounting at the highest level.

But it at least means that sustainability is in the early stages of corporate policy and strategy, which will inevitably mean a trickle down impact on the rest of the organisation in the future. And where these larger companies go, so smaller organisations will follow.

As sustainability moves up the corporate agenda, so the impact on ICT operations will change. To date many ICT carbon saving initiatives have been instigated by the IT department as a money-saving exercise and often assessed and approved as part of IT budget considerations, possibly with the involvement of the CFO or equivalent. Most have not been part of a corporate sustainability policy initiative, more likely as part of a company-wide cost cutting exercise.

We will shortly see the next stage of green/sustainable ICT. As companies increasingly incorporate sustainability into their corporate strategies, so IT operations will have to align with that strategy. IT initiatives will cease to be primarily a piece-meal approach and become an integrated aspect of the corporate sustainability objectives, driven by IT governance. There will be no distinction between whether it’s so-called ‘green for IT’ or ‘IT for green’, but all part of a wider corporate strategy.

© The Green IT Review

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