Sarwar Khan, Global Head of Digital Sustainability at BT, discusses the evolution of the CIO and the influence of Digital Transformation on the role.
“As the world becomes increasingly digital and organisations pursuing Generative AI, a shift is taking place within boardrooms. CIOs are now fulfilling more strategic roles to drive Digital Transformation and sustainability.
Going circular
For multinational corporations, the focus has broadened from just carbon emissions to a circular economy model, encapsulating responsible resource consumption, recycling and waste management. As a result, CIOs are being tasked with more than just ensuring the smooth operation of IT systems; they are now expected to drive sustainable digital strategies, helping businesses reduce their carbon footprint while concurrently optimising operations.
Take BT’s initiative as an example; it has recently launched a digital tool to help multinational customers optimise their network environmental performance and measure outcomes. This proposition gives the CIO the power to manage and measure an organisation’s environmental impact in real-time, providing them with the much-needed information to balance performance, energy consumption, emissions and cost.
Of course, digital technologies also play a vital role in helping reduce global carbon emissions as Information and Communications Technology (ICT) is estimated to help reduce CO2 emissions by as much as 20% by 2030. With environmental commitments transitioning from risk management pillars to operating status benchmarks, CIOs are instrumental in integrating these green technologies into their organisations’ operational fabric.
Embracing sustainability
The digitalisation of operations is not just about reducing carbon emissions anymore; it’s now about incorporating sustainable practices into every aspect of the business. For instance, by migrating digital workloads and applications to data centres with lower Power Usage Effectiveness (PUE) factors, organisations can reduce energy and carbon usage. Even seemingly simple steps like digitising supply chains can contribute significantly to sustainability targets.
Another example includes auditing the organisation’s existing network and replacing copper cables with fibre connections where possible bodes impressive gains to optimising energy consumption. Such projects further underscore the expanded role of the CIO in navigating the complex terrain of Digital Transformation and sustainability.
Interestingly, organisations pursuing both Digital Transformation and sustainability simultaneously are 2.5x more likely to be among tomorrow’s strongest-performing businesses. For instance, the use of advanced digital technologies such as IoT, Edge, Data, AI and 5G can play a critical role in an organisation’s transition to net zero. The CIO’s expertise is crucial in evaluating and implementing these technologies to support new sustainability apps aimed at optimising energy use and reducing carbon emissions.
Business reinvention
CIOs are no longer limited to simply being ‘pure techies’. Today, they help lead the charge as organisations globally, and the public at large, embrace a more sustainable future.
The evolution of the CIO has been driven by the demands of Digital Transformation and sustainability. They must now not only ensure that the digital lights remain on, but that those lights shine a bit greener with every passing day.”
In Part One of this Editor’s Question, we speak to experts from Circular Computing, Informatica and TCO Development to gain insight about the CIO’s role and how sustainability has impacted decisions at the top.
Rod Neale, CEO and Founder, Circular Computing
Sustainability is no longer a checkbox exercise or footnote in a CIO’s job description; it has become an integral part of the role as the environmental challenges we face as a society have reached the boardroom. All businesses, regardless of size and sector, are responsible for managing and minimising their environmental impact, and the CIO holds the keys to a wide range of technologies that can be part of the problem – or part of the solution – depending on how they approach that responsibility.
Regulation is driving much of this change. Over the past decade, we’ve seen a 155% surge in ESG regulation as governments worldwide seek to curb corporate carbon emissions. Tighter regulation means no part of business operations is safe from scrutiny, and in our increasingly digital world, IT is always going to be a part of those conversations.
Pressure is coming from clients and consumers too, with some choosing to vote with their wallets and others opting to openly protest. Brands that can show they are taking quick action on sustainability are better placed to protect and, in some cases, even enhance their reputation, increasing customer loyalty and market share.
Employee activism is another emerging risk-factor that can turn a brand’s public reputation on its head overnight. Employees must feel invested in sustainability efforts, and I would urge CIOs to think about how each one interacts with their employer. Nine-times-out-of-10, that interaction is going to be technological – be that a laptop, mobile, printer, vehicle or connected device – and that medium is a great opportunity to show employees you are walking the walk.
We’ve seen a remarkable increase in demand for remanufactured laptops in the past year, not just because they cost less, both financially and for the climate, but because employees are actually pleased to know their laptop is part of the solution. I would urge CIOs thinking about ways of making progress on sustainability within their organisation to look at remanufacturing as a simple solution that is as likely to win them friends in the boardroom and shareholder meetings, as on the shop floor.
Levent Ergin, Chief Information Sustainability Strategist, Informatica
ESG reporting was initially picked up by the CFO and their controllers. However, as it has become more evident that ESG is a data challenge, the budget holder is now very much the CIO.
Businesses are facing a raft of new regulations on ESG reporting, including around Scope 3 emissions – which originate not with the organisation itself but with suppliers in its wider ecosystem. That means ESG reporting is now an imperative rather than a nice-to-have, but the amount of ESG data businesses need to locate, clean and organise has grown rapidly – and the process of collecting it has become much more complex. Organisations now need to collate information from a whole range of companies, which will potentially come to them in a variety of formats and need to then be organised, standardised and submitted to the regulator in the correct format.
And it’s not just Scope 3 reporting that keeps CIOs up at night. Other regulations such as the German Supply Chain Act, EU’s Corporate Sustainability Due Diligence Directive and the EU’s Deforestation Regulation all require a robust, data-centric approach to ensure compliance.
It’s clear that sustainability is very much a key concern for CIOs. They have responsibility for ensuring their organisations can handle the new influx of data properly – ensuring accuracy, quality and usability of data. The key to strong, accurate reporting is, of course, strong, accurate data. As precision becomes the priority, organisations will need control over their own data collection, management and analysis – all of which ultimately lands at the feet of the CIO. To ensure regulations are accurately met, organisations need to be able to understand exactly how their ESG figures have been reached, which means their data collection and management capabilities need to be top-flight.
Many of the functions that need tracking for ESG reporting may not have previously been subject to regulation. So in many cases, that means there won’t be processes or infrastructure in place to enable robust data collection. At present, much of the data input in these areas may be manual which brings with it the risk of human error. To counter these challenges, businesses need to use advanced data management tools that will accelerate processes and improve accuracy – optical character recognition (OCR), for example, which can scan a utility bill, automatically capture key pieces of information and gather it into a structured format. Or linking smart meters to a central data management system that can compile and standardise data into a usable form.
Sören Enholm, CEO, TCO Development
In the last 10 years, sustainability has developed from being a special interest for a few engaged individuals to becoming a major risk area for owners, boards, CEOs and management teams. With the global need for urgent action on climate change, supported by growing concern from citizens and consumer expectations, sustainability initiatives have also become a business necessity for future success. With increased digitalisation and dependence on IT technology in organisations, sustainability is a top priority for CIOs.
Positioned as they are at the helm of technology innovation, CIOs have always held a role of being an agent of change. Today they have a real opportunity to act as a key player in the climate emissions challenge and create a lasting legacy for good. To achieve this, it is no longer enough for CIOs to simply act as IT investment advisor, they must also be an enabler for more sustainable business practices.
There are lots of reports on the increased footprint of all the IT services we are using, which is, of course, key to lowering the climate emissions and other environmental and social impact of our IT. But there is also lots of possibility for decreasing the footprint of an organisation through a smart use of IT services. Digital meetings instead of travelling is an obvious example, but there are many other less obvious ones.
My view is that CIOs need to work on both these aspects for positive results and credibility. A great place to start is to ensure that IT services and devices have an environmentally and socially sustainable life cycle, and not just optimised for low cost. The businesses and organisations that have been aiming for sustainability the longest are now looking into circular business models – such as Products-as-a-Service (PaaS) – for their PCs, mobile devices, display products, imaging equipment and data centre technology. Change must be made and putting a halt to linear patterns of buy-use-dispose into landfill is part of the change for good.
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