Practical Sustainability: Aligning Existing Technology Initiatives with ESG Goals

I had the pleasure of delivering a keynote on our shared responsibility towards ESG (or Environmental, Social and Governance) goals at the 2023 Toronto IT and Innovation Roadshow. Participants from multiple public sector ministries in Ontario attended the session and we had an interesting discussion on how organizations can align their existing technology initiatives with ESG goals. This blog summarizes the key ideas that we exchanged during and post the session.

ESG Creates Both Immediate and Long-Term Value

ESG is no longer a nice to have but a business necessity. These initiatives create value, but organizations are falling short. Infosys recently surveyed 2,500 executives and ESG experts who say their organizations expect ESG to pay off in the future – but why wait?

ESG need not be future looking all the time. It presents an opportunity to save more, share more and create more value, driving equitable and sustainable growth for all the stakeholders, today. In fact, it is possible for organizations to achieve 50% of their sustainability goals in 5 years through existing technology with a ROI in 1 to 3 years.

Working off this premise, Infosys started focusing on ESG a number of years back and have been able to improve outcomes across all three dimensions – environment, social and governance.

We achieved carbon neutrality 30 years ahead of the Paris Agreement without the purchase of any carbon offsets. We have been able to reduce per capita energy usage by nearly 55% and water usage by nearly 64% through 26 million square feet of green buildings. Our carbon offset projects have created over 2,600 jobs, and our broader ESG initiatives are benefiting over 119,000 rural families.

We have been rewarded for our efforts. Wall Street Journal has rated us in the top 100 most sustainably managed organizations and we have been recognized among the World’s Most Ethical Companies for the third year in a row.

ESG Is Not a Cost-Center

One thing we learned was we need to see ESG as a “Value Generator” instead of a “Cost Center.” Organizations should start assessing their existing projects through the lens of ESG being a desired outcome rather than an additional expense. They can do this by targeting systems and processes that are contributing most to greenhouse gas (GHG) emissions. For example, the spaces in which we work are a 40% contributor to GHG emissions and the energy consumed is the second largest contributor. In fact, 66% of the energy created is wasted.

We partnered with MIT and the Economist to advise on and advance sustainability initiatives that enable organizations to realize both immediate and long-term value, and have developed a Practical Sustainability approach to help them to navigate their ESG journeys.

Aligning Technology and ESG Initiatives Through Infosys Sustainability Maturity Framework

A key component of the Practical Sustainability approach is the Sustainability Maturity Framework. It helps organizations align their technology initiatives to their ESG goals through four levels of maturity. Here’s how:

Level 0

Level 0 is all about data. Does your organization understand ESG data and translate it into meaningful business activity? Some ERP systems can be easily configured to capture and return ESG data which can further be leveraged by other tools/solutions to create comprehensive dashboard communicating ESG outcomes. This is the first thing for organizations to focus on as they start their ESG journey.

Level 1

The next level (Level 1) addresses internal operations, i.e., what can organizations do to move the yardsticks forward in process optimization and efficiency. Initiatives may include adoption of solutions that help improve the performance of your assets or equipment. Examples include migrating data centers to the cloud, building smart spaces that are energy efficient and make staff more productive, and making the supply chain more efficient through electronic procurement or track and trace initiatives.

Level 2

Level 2 is where organizations start thinking about what they can do as a service to optimize resource consumption. They also explore ways to repair or improve systems and processes. A few technology initiatives that improve outcomes at this level include legacy modernization such as code refactoring projects, adoption of shared-services models across teams, e.g. adoption of multi-tenant, cloud-based solutions.

Level 3

The last level (Level 3) is where organizations really focus on the idea of building a sustainable ecosystem. This includes development of a circular business model which shows how an organization creates, delivers, and captures value to a broader range of stakeholders while minimizing ecological and social costs. Organizations operating at this level combine different capabilities they’ve developed at other levels to improve operations, productivity, and social outcomes. For example, organizations can extend their electronic procurement solution to enable agile and social procurement, they can leverage IoT and blockchain to ensure supply chains follow ethical sourcing practices, and they can use low-code/no-code platforms to deploy new features at speed and scale, delivering value to users and customers faster.

Typically, but not absolutely, as an organization moves up the maturity framework, it moves from attaining E goals to meeting ESG goals overall.

Here are a few examples of public sector organizations aligning their technology and ESG Initiatives through this framework.

An Auto Manufacturer leveraged machine learning to identify failure patterns and optimize operations. This generates operational savings of $4M and a 15% reduction in energy consumption. A State Government used blockchain-based solution to optimize workflows for CPA’s to acquire business licenses, turning a task which used to take months to a 30 minute online process. A Food and Agri company used IoT and blockchain to track and trace product supply lines which improved accuracy and ensured ethical sourcing.

The possibilities become endless when organizations start thinking of ESG as a value generator instead of a cost-center and use the Practical Sustainability approach to navigate their ESG journey.

Author Details

Donald Stokes, Director, Infosys Public Services

Donald is a seasoned IT expert with more than 30 years’ experience in developing and delivering solutions to clients that have consistently met or exceeded their expectations.