Digital leaders need to reboot sustainability as a tech focus

February 2, 2023
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Chris Tilley, Nash Squared's Chief Financial Officer, discusses sustainability and what digital leaders need to consider going forward.

Sustainability and ESG have become critical focus points for corporates as they look to help preserve the planet by managing their carbon footprints down to reach Net Zero targets and play a positive, purpose-led role in society and communities.

So it’s disappointing to see that the profile of the sustainability agenda amongst digital leaders (CIOs, CTOs, Heads of IT etc) surveyed in this year’s Nash Squared Digital Leadership Report has been static over the last year.

Just over four in ten digital leaders think technology has a big part to play in improving sustainability, unchanged from a year ago, while a quarter of respondents still think it has only a negligible or no part to play.

Only a quarter are using technology to measure carbon footprint to any great extent, which is surely a bare minimum involvement, while only 20% are ensuring the supply chain/partners are sustainable.

The bulk of digital leaders’ involvement in the sustainability arena still rests, as last year, with bread and butter aspects like using technology to increase operational efficiency and reduce business travel.

An agenda that’s here to stay

Of course, change takes time and there has been a very full agenda – to say the least – in the past year, with the pandemic swiftly followed by the outbreak of the war in Ukraine, further supply chain disruptions, and spiralling inflation and cost of living pressures.

It’s actually not surprising, therefore, that the sustainability agenda has been crowded out to some extent. But it’s not something that’s going to disappear and digital leaders can’t afford to turn away from it. Its prevalence will surely build back over time – and will be kickstarted again by the COP27 conference taking place in Egypt this month.

Digital leaders surely need to do more. The environment may have got tougher and economic conditions may be tightening – but it’s during times of retrenchment that there is an opportunity to stand out.

Opportunity for digital leaders

For me, the really crucial point is just that – it’s an opportunity. Technology is firmly established around the boardroom table as a key topic in the running of the business; so too is sustainability. By bringing the two together and creating a joined-up conversation, digital leaders have the chance to become even more relevant and important to their organisations.

They can do this in a number of ways. Firstly, sustainability really matters to an ever wider range of stakeholders. Increasingly, clients will ask about credentials and commitments in this space in order to consider technology businesses (and other suppliers) for tenders; governments may also insist on certain standards and certifications before giving suppliers a place on their frameworks; while investors want to see increased commitment to ESG too.

Digital leaders who help promote and create more sustainable solutions, products and services will therefore be directly feeding into stronger commercial prospects for the business.

Digital leaders can also further help their organisation save on costs through sustainability – a growing priority for everyone at this time. This is partly about the operational efficiencies (through automation for example) and reduced travel through use of technology, but there are many other ways too.

Moving the organisation to renewable energy sources and suppliers is a good example. Sustainable energy is only going to get cheaper in the years ahead while ‘dirty’ energy gets progressively priced out.

Moving to the cloud, which many are now doing, generally saves organisations money as well – and there is an additional green benefit here in selecting a cloud provider that powers its data centres on renewable energy (or has a clear path towards doing so).

Benefits and attractions for staff

There are savings that can be made which benefit employees as well as the business itself. For example, moving to an EV car fleet. Incentives are available in many countries (including the UK) that will save employees significant amounts of tax from an EV compared to a petrol or diesel vehicle; while the employer can save on National Insurance contributions too.

Schemes like this make an organisation’s commitment to sustainability visible to their staff – and that’s a really important aspect at a time when attracting and retaining talent is such a critical issue. This year’s Digital Leadership Report shows that skills shortages are worse than ever – 70% of digital leaders say they threaten to prevent them from keeping up with the pace of change.

A strong sustainability and ESG agenda helps engage and motivate staff and attract new talent, particularly Millennials and others who care passionately about these issues.

Renewing the focus

Digital leaders have an opportunity to act as agents for change. They need to reboot their sustainability focus, building it into their matrix of considerations for every project and activity. This shouldn’t only be for the organisation’s own direct activities but through the supply chain. After all, the majority of a company’s carbon emissions are ‘Scope 3’ emissions from their wider network.

As a CIO or tech leader, amongst the questions you should be asking yourself when selecting (or reviewing) the supplier that hosts your data, runs your RPA or provides other services is: what’s their carbon footprint, and do they have a clear plan and commitment around managing it down?

A digital leader can also make a significant contribution by ensuring the organisation has the data and analytical tools it needs to measure its carbon footprint and environmental impact. You can’t manage what you can’t measure, after all. What’s more, it will become almost unavoidable to do so as mandatory reporting requirements come on line.

At Nash Squared, we began the process a year ago when we published a Carbon Reduction Plan towards the end of 2021 and then a Sustainability Report in early 2022. The process of doing this increased the discipline and rigour with which we approach these areas, and has resulted in greater engagement with clients, stakeholders and staff. We look forward to updating and refreshing our progress each year.

If you’re a digital leader, don’t make the mistake of thinking that sustainability has very little to do with you. See it as an opportunity. Get involved. There are many ways that you can play a key role, helping the business move towards a more efficient and innovative blueprint that has benefits across the enterprise.

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