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As the world’s third-largest producer of greenhouse gases and a global hub for technological innovation, India has been pushing companies operating in the country to reduce their carbon footprint for some time.
Homegrown companies Reliance Industries, HDFC Bank and others have pledged to reduce their carbon footprint as early as 2030, while multinationals like Cisco and SAP have doubled down on sustainability initiatives in the country.
Take, for example, Cisco’s Bangalore campus. The entire campus is powered primarily by renewable sources, and the company has gone from using 2% renewable energy in 2015 to 66% in 2021.
Anand Patil, Cisco’s senior director of systems engineering in India and the South Asia region, said addressing climate change is a long-term strategic priority for the company.
“It’s not just a risk to manage, but an opportunity to help the global transition to a low-carbon future,” he said, noting that Cisco recycles and reuses 99.9% of the products it returns free of charge.
“Most importantly, we are also continuously working to improve the energy efficiency of our products, save energy and reduce carbon emissions for our customers and us,” he added.
SAP, meanwhile, aims to be net neutral in all its India operations by 2023. It has also partnered with the Energy and Resources Institute to help India achieve sustainability in key industries, service delivery and government.
Forrester recently analyzed the environmental sustainability strategies of 50 large organizations in Asia Pacific (APAC), including nine major Indian firms in manufacturing, financial services and retail.
Of these, six cited a preference for sustainability, which is on par with the regional average, although Indian companies lag behind their regional counterparts when it comes to committing to direct and indirect emissions reduction targets and a carbon neutral or net zero date.
IT services firms, however, are taking the lead. Both Tata Consultancy Services and Cognizant, for example, have committed to be carbon neutral by 2030 through a combination of emissions reductions and carbon offsets.
There is still work to be done
Ensuring data center sustainability is critical for organizations in India to achieve their carbon goals.
“Data centers are critical to India’s future and have always been looked down upon for their excessive energy consumption and increasing carbon emissions,” said Keshav Kumar, general manager of data center resales at Raha, a global systems integrator.
Citing research by JLL, a commercial real estate services firm, Kumar said India’s data center capacity could double from 499 MW in 2021 to 1 GW by 2023, potentially increasing India’s carbon footprint if data centers are not managed. efficiently.
Michael Barnes, vice president and director of research at Forrester, noted the role IT functions play in helping organizations reduce data center carbon emissions.
“Optimizing IT infrastructure and operations presents huge opportunities – this includes accelerating migration to the cloud and optimizing consumption while actively managing hardware and software.”
For Ashish Agrawal, CEO of technology services provider Nagarro, the sustainability of IT infrastructure has been ignored for too long because IT services have traditionally not been seen as a high-emitting industry.
“But every text, video stream and virtual meeting has a carbon impact and creating awareness about the choices we make is important,” he added.
For data center operators, these choices focus on energy and water, both of which are needed to run data centers and ensure proper indoor conditions such as temperature and humidity.
“Running closed cooling water systems in data centers and powering them with renewable energy must be the default as we move into a more digital future,” Agrawal said.
Agrawal also pointed to an often forgotten area of carbon impact – laptops.
“As the world gets richer, everyone wants a new laptop regardless of what that means and what happens to their old devices,” he said. “Radical transformations at the policy level and at the consumer level are needed to encourage repairability and recycling in laptops.”
Beware of greenwashing
With more consumers now expecting companies to undertake environmental, social and governance (ESG) efforts, companies that feel pressured to act quickly may misrepresent or exaggerate their actions.
“Misrepresenting your firm’s environmental sustainability policies and actions will result in negative customer reactions, loss of brand credibility and trust, and potentially fines,” said Forrester’s Barnes.
“In fact, Forrester expects at least 50 firms in APAC to be penalized for the performance of their ESG efforts in 2023. Offenders could face fines of $10 million or more as APAC regulators follow the footsteps of their US and European counterparts and suppress misleading ESG claims.
“Avoid greenwashing by always acting authentically, openly and transparently, and admit your mistakes with empathy and courage,” he said.
The lack of measurement and standards around ESG doesn’t help either.
A recent study by Oxford Economics and SAP found that while 62% of Indian businesses say it is not difficult to be sustainable and profitable at the same time, only 17% have calculated their total carbon footprint. And among those who have acted on a sustainability strategy, only 7% derive significant value from it.
“If we want to create a global accounting system to measure the path to net zero, we need some level of uniformity in how we collect and process data and the meaning we derive from it,” Agrawal said.
“Using a global standard or one accepted across the industry is essential in the collaborative journey towards the Paris Agreement.” Using a standard measurement format also helps maintain consistency over the years so one can understand one’s own journey in terms of progress made and lessons learned.”
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