The road to a sustainable future in the communications industry

Pressure on companies to reduce carbon emissions comes from many directions. The science outlined in the “The Human Imperative of Stabilizing Climate Change at 1.5˚C” has motivated companies to align their decarbonization strategies with even more aggressive targets than those set forth in the Paris Agreement. Shareholders and investors are also looking hard at ESG initiatives, recognizing that companies with consistently high ESG ratings outperform their peers in shareholder returns and operating margin. Regulations and policies are expanding, with more than 50 national and subnational jurisdictions now having some type of carbon price. And, there are operational motives too: 35 percent of CEOs report that sustainability is driving cost savings today,[i] and customers are increasingly demanding corporate social responsibility. Two-thirds of consumers are willing to pay more for sustainable brands[ii] and nearly half will drop a company if they don’t think it’s aligned to their values.[iii] 

 Carbon reduction in the communications industry and how to build a more sustainable future will be an important theme at Mobile World Congress (MWC) Barcelona later this month. The good news is that the Information Communications and Technology (ICT) sector is already acting to reduce its carbon emissions by purchasing renewable energy, setting science-based targets and by making the management of data more energy efficient. So, even though data traffic is predicted to grow eight-fold by 2030, the amount of energy used to manage that data will not rise in the same exponential way. In fact, according to research by Accenture, carbon emissions from the ICT sector are expected to drop by as much as 40 percent by 2030 due to significant actions being taken by the sector to improve energy efficiencies across three technology groups: mobile networks, fixed networks and data centers. Fully retiring legacy 3G networks will be critical to reaching our carbon emission targets where energy is not sourced renewably.

 But what else can be done by the communications industry? There are at least four areas where we can make near-term operational and network management changes:

• Sustainable Networks - Drive strategic network investments and management of inside and outside plant operations, in areas such as energy optimization and predictive analytics, renewable energy procurement and strategic consolidation of network assets.
• Sustainable Operations - Realize cost savings and invest in strategic platforms to streamline operations and reduce emissions. The cloud and green IT, enhanced HVAC and adopting sustainable supplier requirements are some program examples.
• Green Fleet/Logistics - Optimize logistics and shift to low emission transportation to reduce overall fleet impact. This may mean reducing truck rolls with AI operational intelligence, transitioning to EV and lower emissions transportation, smart routing and/or fleet logistics optimization. 
• Network Resiliency - Identify opportunities to strengthen network capabilities against weather and regulatory risks through programs such as weather risk analysis of network assets, predictive weather response analytics or proactive network hardening.  

Sustainability is no longer a ‘green premium,’ it’s an essential, integrated element of business strategy. Any new initiative should be able to drive both business and environmental value, with a lens on total cost (comprised of financial, sustainability and brand). For example, reducing truck rolls through self-service installation and repair not only reduces cost but also brings carbon emission reduction and customer service benefits. With this in mind, the communications industry can lead through innovation at three levels:

• Sustainability innovator – Lean in hard on internal programs as outlined above, such as green IT, energy efficiency, predictive energy management, green fleet, water and waste reduction and network resiliency. 
• Ecosystem enabler – Become the enabler or orchestrator of ecosystem-wide initiatives such as smart buildings, campuses and cities powered by IoT, edge and 5G applications, or smart transport through EV charging infrastructure. Form partnerships within the value chain to tackle emissions and data opportunities. 
• Consumer leader – Help consumers integrate environmental benefits in their lives through offerings that reduce energy and device usage, enable connected home energy management and facilitate remote work which will take cars off the road.

Increasingly, true business value creation will come from strategies that drive a combination of financial, environmental and customer benefits. When communications companies simultaneously attack financial and ESG priorities, they can please both shareholders and customers and drive growth and greater shareholder returns.

 Accenture works with our clients from strategy to execution to ensure their programs achieve both business and environmental benefit. I’d love to hear how your company is innovating to contribute to a more sustainable future. Please reach out to me to discuss, share your comments, or let’s plan to connect at MWC Barcelona to chat more. You can learn more about Accenture’s agenda at MWC here.

[i] Climate Action 100+

[ii] Nielsen, 2015

[iii] 2 IEA, 2020