Telecoms and tech companies are often perceived as ‘baddies’ for causing environmental damage all the way from equipment manufacturing, using massive amounts of electricity in data centers, or wasting resources through speculative cryptocurrencies. However, as a group, they actually lead the way across all aspects of ESG (Environmental, Social, and Governance) initiatives.
Technology such as IoT (Internet of Things) can help optimize irrigation in farms (and given the current weather patterns, it’s becoming ever more important). AI can be used to maximize productivity in vertical farming. Hyperscale cloud service providers are multiple times more efficient than private data centers. The combination of broadband and mobile communications helped enable white-collar workers to adjust to working from home during the pandemic – imagine how much worse the economic, social and health impacts would have been but for the dynamism of tech to change ways of working in response to Covid-19.
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Telecoms ESG commitments
When it comes to the environment and sustainability, most telecoms and tech companies have made substantial commitments to being carbon-neutral and reaching carbon net zero – often within tangible timescales (governments, however, tend to set targets for future generations and are open to shifting the goalposts, which is the ultimate ‘greenwashing’). Enterprise telecoms and tech companies are demonstrating their commitments with sustainability performance reporting – driven by their customers, investors, partners, and employees: talent is a rare commodity and a good ESG record can be a differentiator. Increasingly, sustainability commitments are included in C-Suite bonus targets and in employee training too, as well as becoming more aligned with financial reporting.
When it comes to social targets, enterprise telecoms and tech companies lead in areas such as enabling digital inclusion, supporting human rights across their operations worldwide, encouraging diversity and inclusion, and community impact through, for example, committing to employees being able to volunteer for charity work. It is also clear that these areas are being actively focused on.
Most enterprise telecoms and tech companies have committed to gender, orientation, and race diversity targets – and they measure and report on them, which is key. No accountability, no credibility. In terms of governance, commitments to eliminating potential corruption are now in companies’ DNA, with a few occasional notable exceptions. On the rare occasions that ethical standards are broken, it can cause a PR furore, damage brand and reputation, and impact a company’s share price. This keeps the C-Suite on its toes in the key strategic area of ESG.
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