Green means go

To put a modern spin on the words of everyone's favourite frog puppet, it still ain'teasy being green - but it is a quality increasingly coveted by global big business.

In a world where environmental credentials are beginning to carry clout with stakeholders, companies are jostling to add sustainability champion to their list of bragging rights, and this year, tech players topped the charts.

In Newsweek's annual Green Rankings for 2010, which rates the biggest publicly traded companies in developed and developing world markets, ICT companies occupied six of the 10 highest spots in the global top 100 list.

IBM and HP took first and second place, while Sony, Deutsche Telekom, Panasonic and Toshiba also made an appearance in the top 10. The fact that Nokia, Vodafone and NTT came in at number 11, 14 and 16 makes it clear ICT companies are starting to walk the green talk, as it were.

Interestingly, the US results reveal an even greater tech dominance, with Dell, HP, IBM, Intel, Sprint Nextel, Adobe, Applied Materials and Yahoo all in the top 10 (because the global ranking includes US companies, some appear on both the US 500 and the Global 100 lists).

So, it would seem things are looking good for the ICT industry when it comes to sporting a clean bill of eco-health. Yet, other results, in the global Carbon Disclosure Project's IT sector report, offer sobering insights into how deep tech companies are willing to go with their greening initiatives.

The project sends questionnaires to more than 4 700 of the world's largest corporations, to glean info on greenhouse gas (GHG) emissions, major risks and opportunities related to climate change - and what companies are doing about it.

The 2010 report shows the overall number of responses from IT companies increased from 78 to 84 - a steady result compared with last year's response rate (70%); emissions disclosures improved by 8%. But, while initial numbers look good, a closer look shows many companies seem comfortable dipping their toes in the sustainability pool, but few are prepared to dive in and begin a long-haul swim.

The performance scorecard is telling. The IT sector lags behind its industry counterparts, with more than a third of respondents failing to achieve the minimum disclosure score required for a carbon performance rating. IT is second to last across all sectors, with only three respondents earning an A in performance. And it scored below the overall average in every category - governance, stakeholder communications, achievements, and strategy. Not so rosy after all.

The strategy result is notable, because there seem to be major contradictions around how it is approached. Only 35% of IT respondents said climate change has been integrated into their overall business strategy, compared to the sector average of 44%.

Maybe this is because they don't see it as particularly threatening yet. As the CDP points out, IT disclosed the lowest level of risk associated with climate change of all sectors.

Many companies seem comfortable dipping their toes in the sustainability pool, but few are prepared to dive in.

Lezette Engelbrecht, online features editor, ITWeb

But what about the potential to address the climate-related risks all the remaining industries face? The study shows tech companies' greatest opportunities lie in providing solutions to help others manage and mitigate their GHG emissions. The ICT sector has the potential to reduce emissions five times greater than its own direct impact by 2020, according to the Smart 2020 report.

IT players seem to recognise this potential, with 79% of the sector reporting at least one type of significant opportunity (although this is a decline from the 89% reporting prospects last year).

So why the discrepancy between IT's recognition of opportunities, and the actual integration of this into companies' strategic planning?

I'll be the first to applaud the commitments tech companies have made to reduce their environmental impact, but there's a short-sightedness that's worrying. If these companies are going to dominate and shape our future world, they need to start looking beyond performance badges and begin innovating, to become the suppliers of a global economy built on new systems.

As an OECD analysis shows, most green IT initiatives concentrate on the direct effects of ICTs themselves, rather than tackling climate change and environmental degradation by using ICT as an enabling technology.

The OECD notes that ICTs have the ability to tackle climate change and improve environmental performance across economies, with the biggest gains lying in solutions aimed at power generation and distribution, buildings, and transportation.

These areas pump out the most greenhouse gases, and they also happen to form the foundation of emerging cities. As urban centres mushroom, become more connected, and face greater environmental stresses, the players which establish themselves now will become the leaders in a century increasingly focused on sustainability - not as an industry catchphrase, but as a way of life.

A recent Gartner-WWF survey on environmental leadership in the ICT industry stresses that innovation is pivotal to spurring the growth of a global green economy. But it adds that governments and companies seem to be plodding along their business-as-usual paths, failing to recognise the massive potential.

While a group of market leaders is emerging, the industry as a whole falls short of making climate change and sustainability part of its core business, it said.

A WWF consultant pointed to a surprising lack of “disruptive innovation” and that if the ICT industry was to significantly contribute in the transition to a low-carbon economy, it would require substantially more than incremental improvements.

Sure, many IT companies have yet to implement an internal green programme, never mind branching out to other sectors. But for those which have managed to put their own house in order, it's now time to shift attention to the bigger picture.

There's a whole world that's going to face challenges similar to the ones IT companies are preparing themselves for. Businesses and consumers alike are going to start looking for solutions surrounding information and communication about these problems; very rapidly, and very widely.

These are not threats that are going to go away. Global warming, climate change, and resource degradation are not flavour-of-the-month trends. They are realities backed by hard science that will affect virtually all sectors of business and society for decades to come. It might be something to look into if you're a company involved in providing solutions for future problems.

As IBM's CEO Sam Palmisano said at the Start summit in September: “The key precondition for real change now exists: People want it. And they are hungry for leadership. Such a moment doesn't come around often, and it will not last forever.”