How Digital Sustainability Is Changing Business

Sustainability has been very much in the news recently, as severe weather events and environmental issues coincide with major international gatherings to throw the spotlight on the continuing menaces of global warming and catastrophic climate change.

The global situation is becoming increasingly dire. Humanity and the world as a whole are on a clear path to destruction, if warming due to carbon-intensive industrial processes, the excessive consumption of nitrogen and phosphorous, and large-scale losses in biodiversity are allowed to continue.

Industrial agriculture relies heavily on nitrogen and phosphorous inputs to boost harvests. However, this practice is poisoning waterways, producing massive algae-blooms and coastal dead zones, and threatening global food security.

Within the next few decades, an estimated one million animal species could become extinct, as almost 50% of the world’s animal populations suffer from habitat destruction due to human land consumption and wildlife poaching activities.

According to the IPCC Working Group I report, Climate Change 2021: The Physical Science Basis, strong and sustained reductions in emissions of carbon dioxide (CO2) and other greenhouse gases could limit climate change. However, while the resulting benefits to air quality would be felt quickly, it could take anywhere from 20 to 30 years for global temperatures to stabilise.

The overriding imperative in all of this is that we need to act now.

Over the past 30 years or so, digital technologies have been transforming the nature of business and commerce. This began in the early years with a shift from manual and analogue methods of computation and record keeping to the performance of these functions on desktop computers, laptops, and more recently, mobile devices. In the subsequent decades, cutting edge technologies like Artificial Intelligence (AI), Machine Learning (ML), virtualisation, and the cloud have redefined the ways in which we manufacture, purchase, work, and live our daily lives.

With the dire predictions of organisations like the IPCC Working Group in mind, climate change and environmental awareness are today the prevailing factors that must influence the way that we produce, consume, labour, and exist. If we neglect to take these factors into account, the Earth itself will become unable to sustain us entirely, making it impossible to perform these essential activities at all.

It is in this sense that sustainability is the new digital. It has become the defining factor which will determine how we think about business and life itself for the next 30 years — in the same way that digital has dominated the past three decades.

As analysts Orit Gadiesh and Jenny Davis-Peccoud put it: “We need to transform a global economy founded on the principles of unlimited access to resources and the primacy of shareholders to one that recognises the limits and consequences of everything we extract, manufacture, consume and waste, and the impacts on the people involved in doing so.”

Appropriately enough, digital technology has a role to play in making this vision a reality.

Enterprise Resource Planning (ERP) systems like metasfresh ERP can play a role in digital sustainability by streamlining business processes, increasing productivity and efficiency, reducing costs, enhancing customer service, and facilitating collaboration between stakeholders.

Gerard George, Ryan K. Merrill, and Simon J. D. Schillebeeckx, co-authors of Digital Sustainability and Entrepreneurship: How Digital Innovations Are Helping Tackle Climate Change and Sustainable Development, define digital sustainability as a set of organisational activities whose target is to advance the United Nations’ Sustainable Development Goals (SDGs) through the creative deployment of technologies that create, use, transmit, or source electronic data. Furthermore, the economic objectives guiding these activities focus on the creation of value for society and the environment, making any trade-off between profit and purpose irrelevant.

In this scenario, digitalisation becomes the principal avenue by which digital sustainability can deliver on the global sustainability goals. For businesses, digitalisation with this focus enables organisations to develop and deploy technology in order to secure long-term competitiveness and growth within the planetary boundaries, and with regard to the SDGs. Taken in this light, the technology of digital sustainability empowers businesses to:

• Use digital technology to reduce costs, optimise business operations, and minimise negative environmental impact
• Generate new revenue streams and have a positive effect on society by developing new disruptive and transformative business models or value propositions
• Use cutting edge tech such as AI, ML, Blockchain, and augmented reality to facilitate new business models and value-propositions which can fulfil global needs in radically different and sustainable ways

In agriculture and urban planning, land use analysis technology can reduce deforestation and prevent the excessive utilisation of existing land resources. Annual crop yields can increase due to improvements in weather forecasting. Intelligent recycling schemes can help to minimise the amount of waste that ends up in landfill sites, and provide new ways to reuse finished goods and products. Smart electrical grids can optimise and reduce overall energy usage, while smart traffic systems and parking schemes can enhance road safety and reduce the consumption of fossil fuels.

Elsewhere, beverage manufacturer AB InBev is using blockchain technology to help monitor the manner in which key ingredients are handled throughout its supply chain. The digital audit trail assists in maintaining environmental standards, and optimises the company’s use of natural resources.

Other digital sustainability efforts in the food and beverage sector involve the usage of new materials. According to research from Bain, plant-based meats could be a US $140 billion industry by the end of this decade, with the retail nutrition and wellness market growing to US $50 billion by 2025. Plant-based beverages like almond milk are currently a US $13 billion market, which is growing at the rate of 12% per year.

Around 40 companies in the plastics ecosystem which includes energy, chemicals, and consumer goods, have come together to form the Alliance to End Plastic Waste. This initiative aims to use innovative solutions that minimise plastic waste and encourage recycling, particularly in developing countries.

As we have seen from the examples highlighted above, digital sustainability efforts span numerous industries, and all aspects of life and resource management. It is also a movement that receives massive impetus from public opinion. With matters of the environment, climate, and conservation high on the list of their priorities, consumers and investors are demanding significant change from the brands and organisations that they deal with. This pressure is becoming especially acute, as the purchasing power and influence of Millennials and younger Generation Z buyers and investors continues to rise.

The response to these demands from the business community may be categorised on the basis of three principal classes of entrepreneur.

Social entrepreneurs demonstrate a willingness to downplay their own profit motives in favour of selected objectives that benefit the societal agenda. Such organisations will typically invest in localised projects that address broad issues like poverty, malnutrition, or health.

Institutional entrepreneurs tend to be embedded within their various social, economic, and political contexts. From this position, they will develop and implement new institutions that advance interests which may previously have been suffering from a lack of resources or will, within the various existing institutions.

Sustainable entrepreneurs go beyond the simple act of formulating a Corporate Social Responsibility (CSR) division within their organisation to incorporate strategies, practices, and processes into their core functions that actively promote pro-climate, pro-environment, and sustainable business practices.

If you are still unsure where to start or what to do with respect to digital sustainability, here are some recommendations:

Seek input from various departments as to which aspects that technology can improve, and where current environmental failings exist.

Supply chain partners, hardware suppliers and software-as-a-service (SaaS) providers may be able to assist in providing the resources, expertise, and infrastructure to support your digital sustainability efforts.

Many candidates today are actively looking to join organisations whose ethical values and attitudes to environment and conservation align with their own. You can include information about your digital sustainability efforts on your website, and give details of your environmental values on job postings.

Infrastructure elements like digital ledgers or server farms require significant amounts of energy to do their work. To avoid defeating your own efforts through over-consumption, select tools that are designed for energy efficiency, and form partnerships with utility providers that use renewable sources.

Virtual meetings and communications platforms have demonstrated their value in reducing the costs of commuting, business travel, and the maintenance of physical office spaces. As a sustainable business practice, remote working options should be left very much on the table — even after the pandemic.

An increased use of digital tools and platforms also expands the size of the attack surface associated with your business. Unsecured personal devices, edge cloud deployments, and the maintenance of online data repositories can present targets for hackers and cybercriminals. So, you will need to beef up your network and data security — in terms of infrastructure, and, if necessary, the hiring of cybersecurity consultants or Managed Service Providers.

To effectively implement sustainability initiatives, organisations need to integrate information, and processes from all sustainable business functions into a consolidated database, from which they can be monitored and managed. A system like metasfresh ERP enables businesses to centralise all sustainable business activities into a single system so that they can keep track of their sustainability performance.

This approach covers all aspects of the business, including sales, procurement, invoicing, and the scheduling of incoming goods.

At metasfresh, our mission is to enable each and every company to access a powerful ERP system that supports digital transformation and fuels corporate growth in a sustainable manner. Get in touch today for more information and insights.