IT giants could do better to tackle greenhouse emissions

6 Nov 2008

IT giants including IBM, BT, Intel and Fujitsu have performed well in a Gartner and World Wide Fund for Nature (WWF) study investigating climate change strategies, while Lenovo, Nortel and China Mobile need to do better.

The survey revealed the emergence of several low-carbon ICT leaders that are innovating in environmental and climate leadership, and other providers that are maintaining the status quo.

However, the assessment showed that the ICT industry overall has been slow to embrace the low-carbon economy, despite the tremendous opportunities that will be presented to the industry, such as smart buildings and grid applications and travel substitution.

Future Human

Gartner and WWF invited 24 global ICT providers to participate. Nine providers, namely Accenture, Acer, AT&T, Deutsche Telekom, EDS, Microsoft, Oracle, Sun and TCS chose not to participate.

Of the vendors that did respond, Fujitsu, BT, HP and IBM did well in virtually every category, while others such as Wipro, Nortel, Verizon, China Mobile and Lenovo did not score particularly well.

There were some surprises. For example, Google has some room for improvement on basic environmental practices, supply chain and solutions for low-carbon economy.

The findings also showed that IT service organisations are quite immature in their environmental programmes and their innovation for a low-carbon economy. Most of these have been very slow to recognise their changing market circumstances and the changing risks and opportunities associated with climate change.

Only a few of these IT service providers have really thought through the implications of a low-carbon economy for their own operations or the potential opportunities it represents for their own business.

The survey revealed that Fujitsu, HP and IBM have a well-structured, balanced, long-term environmental plan that demonstrates a level of commitment across the business.

When it comes to managing supply chain and taking into account the provider’s visibility and assurance, Nokia excelled, IBM and BT have both focused on their tier-one providers (their direct providers) and engaged significantly with their second-tier suppliers (‘sub-tier’ or sub-contractors or the suppliers of their direct suppliers) and beyond. Cisco, China Mobile, Lenovo, Dell and Google all scored relatively poorly.

“They do not have the level of visibility and assurance of good practice that we would expect and fall well short of the leaders,” said Simon Mingay, research vice-president at Gartner,

The Gartner and WWF’s report highlighted that Google does not have an environmental policy. Nortel and Cisco possess environmental policies that are bland and non-committal compared to BT’s policy, which is specific, challenging and linked to key performance indicators (KPIs).

Dennis Pamlin, global policy advisor at WWF, said the biggest challenge in moving an organisation forward strategically to address climate change and environmental sustainability is to ensure a shift from reactive to proactive and make low-carbon solutions a driver for innovation and profit. HP, BT, IBM and Fujitsu did well in this area and all have relatively sophisticated programmes related to low-carbon solutions.

The survey also showed that self-professed leaders lacked an overall greenhouse gas (GHG) target. “An overall GHG target is one of the most basic requirements of a climate change programme, and without it organisations should be sceptical about a provider’s overall climate change programme,” said Mingay.

Companies without GHG targets at the time of the survey included Nokia, Ericsson, Google, Nortel, Cisco, SAP, and Wipro. Lenovo and Cisco have very recently set themselves a target.

The major difference between the ICT providers was in the way they approach the challenge of climate change. Some focus on their own direct and indirect GHG emissions. Dell and Lenovo are focusing on the 2pc of ICT’s global CO2 emissions, whereas BT, HP, Fujitsu and IBM are starting to focus on both the 2pc and the 98pc (eg building solutions that target high-carbon areas of the economy to reduce the need for travel or transportation).

“Those that look at the wider 98pc solutions will drive real innovation and help reduce the overall environmental footprint of their company,” said Mingay.

There is evidence that taking a leadership role in climate change can create a competitive edge.

“Organisations increasingly want to do business with ICT providers and look at them as potential partners in innovation to exploit the opportunities of a low-carbon economy,” Mingay said.

“The winners in a low-carbon economy will be those that realise which products and services have a material and observable effect on carbon emissions and especially those that create low-carbon feedback.

“The current financial crisis provides an interesting short-term opportunity for ICT providers to position themselves as low-carbon leaders that deliver services that both save money and carbon emissions, especially compared with many other solutions where there is a choice between money or the environment,” Pamlin concluded.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years