The future of the technology industry will be shaped by a range of disruptive themes, with environmental, social and governance (ESG) being one of the themes that will have a significant impact on telecom services companies. A detailed analysis of the theme, insights into the leading companies, and their thematic and valuation scorecards are included in GlobalData’s thematic research report,ESG (Environmental, Social, and Governance) in Telecoms and Technology – Thematic Research. Buy the report here.
ESG is the most important strategic theme of the decade. Companies must perform well in all areas of ESG; being a laggard in any one of the 12 pillars outlined in GlobalData’s ESG framework will hurt their brand reputation and, ultimately, profits. Increasingly, ESG will also play a growing role in attracting both investment and talent. All significant technology companies have a stated commitment to ESG, but their goals, delivery, and reporting can vary substantially.
To date, the technology sector has been a leader in ESG as it is at the cutting edge of combining the digital economy and delivering 21st -century employment and governance standards. Technology is also core to many aspects of recording and measuring ESG performance and enabling ESG as a service up and down the value and supply chains. Technology companies that understand, engage with, and prove ESG initiatives and targets will remain in the game: it is not a question of if or when—it is existential, and it is happening now.
However, not all companies are equal when it comes to their capabilities and investments in the key themes that matter most to their industry. Understanding how companies are positioned and ranked in the most important themes can be a key leading indicator of their future earnings potential and relative competitive position.
According to GlobalData’s thematic research report, ESG in Telecoms and Technology, leading adopters include: Orange, Telefonica, Deutsche Telekom, Softbank, BT, Rakuten, Vodaphone and Zain.
Insights from top ranked companies
Environmental: Orange aims to use 50% renewable energy across its operations by 2025, to be carbon net neutral by 2032, and net zero by 2040.
Social: Orange claims it is committed to digital equality, establishing Orange Digital Centers in each of its regions to help people learn how to use digital services. 92.4% of Orange’s suppliers are committed to complying with its code of conduct.
Governance: In 2020, Orange launched the Green Act, a programme that encourages the entire company and its stakeholders to place environmental issues at the heart of their processes and activities. Orange’s Board of Directors includes 45% women.
Environmental: Deutsche Telekom aims to have a climate-neutral footprint within its own operations (Scope 1 and 2) by 2025, and across its entire value chain by 2040. At the same time, the company aims to reduce its global emissions by up to 95%, with carbon capture programmes to cover the remaining 5%.
Social: Deutsche Telekom has outlined several programmes to promote digital participation and digital equality across its footprint.
Governance: Deutsche Telekom complies with legal requirements and national provisions, such as the recommendations of the Government Commission on the German Corporate Governance Code, as well as with leading international governance standards.
To further understand the key themes and technologies disrupting the technology industry, access GlobalData’s latest thematic research report on ESG in Telecoms and Technology.
- SK Telecom
- China Telecom
- Saudi Telecom
- China Mobile
- China Unicom
- T-Mobile US
- NTT DoCoMo
- Chunghwa Telecom
- Rogers Comms
- MTN Group
- Spark New Zealand
- Tata Communications