Why Sustainable Technology Adoption Should be Your Next Strategic Move

  • Swetha GP
  • Sep 12, 2023
  • 14 Min Read
Sustainable Technology Adoption

Article posted by

Swetha GP

VP of Delivery

She is a VP of Delivery at Closeloop. A communicator, business analyst, and engineering aficionado. Besides handling client relations, and engineering duties, she loves to pour her thoughts on paper. She writes about engineering, technologies, frameworks, and everything related to the software domain. She reads, spends time with family, and enjoys a good walk in nature in her free time. Her dream destination is Greece.

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Sustainability has become an indispensable aspect of business success today, similar to digital transformation. Sustainability drives change within all organizational divisions- whether digital or physical modification. Today, sustainability should form an integral component of corporate strategy. In essence, sustainability for organizations plays out across three areas: Environment, Social, and Governance (ESG).

Leading companies recognize that meeting ambitious sustainability goals requires a holistic approach to transformation, encompassing all facets of the challenge at play. Building sustainability into their competitive advantage requires integrating technology and data from day one.

Tech's role goes well beyond "green IT." As more businesses consider how their technologies and sustainability agendas go hand in hand, management teams must view whether game-changing tech and digital thinking are being employed to meet sustainability goals or whether this critical business issue is missing a crucial aspect.

At an IT consulting company, sustainability is embedded into every part of business, from carbon emission reductions through energy-saving technologies to building employee awareness about environmental responsibility. By prioritizing sustainability, they create a greener future and empower clients to build resilient, eco-friendly IT infrastructures that meet future challenges head-on.

Factors Influencing Sustainability as Part of Strategy

Several elements play into businesses adopting more eco-friendly technologies. Below are a few such factors:

Investor Pressure

One of the primary drivers behind sustainability progress is investor demand. According to Gartner research, in 2020, 85% of investors considered ESG factors when selecting investments, while 91% of banks monitored ESG performance of investments.

BlackRock CEO Larry Fink recently wrote in his letter that investors increasingly emphasize sustainability as an essential tenet for long-term profit and success. Being sustainable does not merely involve doing the right thing but can yield long-term, sustainable profits as well.

Consumer Demand

With more millennials and Gen-Z consumers demanding sustainable products, demand is rising exponentially. 73% of Gen-Zers are willing to spend more on such items; according to a Deloitte study, around 60% of UK residents reduced single-use plastic usage in favour of adopting more eco-friendly lifestyles.

1/3 of UK consumers sought brands with strong, sustainable credentials when selecting brands for purchase, and global demand is expected only to increase, making integrating sustainability into corporate strategy an absolute necessity for remaining relevant in future years.

Regulatory Demands

The Paris Climate Agreement has clarified that governments must be more stringent. Sweden and Germany have set legally binding net zero targets for 2045, while other nations, such as the UK, Canada, Japan, etc., have committed themselves to reaching zero net carbon emissions by 2050. Furthermore, the EU's taxonomy on environmental sustainability impacts not only EU businesses but global firms operating within its boundaries as well.

Anticipating the push from many governments towards sustainability, organizations should begin making the necessary adjustments to become more eco-friendly in their operations. Being proactive about sustainability will lead to improved relationships with regulatory bodies.

As organizations increasingly prioritize green IT practices and reduce their carbon footprint, sustainability is becoming integral to IT Consulting services. Businesses increasingly recognize this imperative.

Attracting Talent

Being an ethical company is vital to attracting talent. A Deloitte survey revealed that 49% of Gen-Z and 44% of millennials made career decisions based on personal ethics; further, 51% of US business students would take lower pay if it meant working for an environmentally friendly firm - not prioritizing sustainability could leave your corporation vulnerable against rival corporations that do.

Greater Productivity

According to McKinsey & Company studies, engaging employees in sustainable behaviours will encourage better performance, with costs reduced by as much as 60%, according to McKinsey & Company studies. According to Deloitte research, an inclusive culture leads to 27% greater profits and 22% increased productivity.

Why Sustainability Is Now the Key Driver of Innovation

Unfortunately, many businesses believe that efforts towards environmental protection may damage their competitive advantage and add costs without providing immediate financial rewards.

In response, sustainability is already changing the competitive landscape, forcing companies to rethink their products, technologies, processes and business models. Innovation remains key in an economy in transition; competitive advantage from being environmentally conscious will serve them well during economic crises.

Businesses that have embarked on their path typically go through five distinct stages of transformation.

Stage 1: View Compliance as an Opportunity

The initial steps companies need to take towards sustainability typically start with legal compliance issues. Environmental laws vary significantly across countries, states, regions - even cities!

Enterprises feel pressure to comply with both legal and voluntary codes imposed upon them by nongovernmental agencies and industry groups over two decades, such as the Greenhouse Gas Protocol Forest Stewardship Council code or Electronic Product Environmental Assessment Tool; these voluntary codes often exceed legal regulations when applied cross-border trade.

Sticking with lower environmental standards for as long as possible may seem tempting. Still, it would be more prudent to comply with even more stringent rules before they're enforced - this provides substantial first-mover advantages in spurring innovation.

Companies that focus on meeting emerging norms gain more time to experiment with materials, technologies and processes. Contrary to popular perceptions, adhering to global gold standards saves companies money: when adhering to lesser regulations, they must manage component sourcing, production and logistics separately in each market as the rules vary depending on location.

When you hire IT consultants, it's essential to take their expertise in sustainability into account, as this can play an integral role in helping your organization implement eco-conscious technology solutions and reach its environmental objectives.

Stage 2: Making Value Chains Sustainable

Once companies have learned to comply with regulations, they often become more proactive about environmental concerns and seek ways to decrease consumption of non-renewable resources such as coal, petroleum and natural gas while increasing renewables like water and timber.

Efficiency efforts reach beyond manufacturing facilities and offices to the entire value chain. At this stage, corporations collaborate with suppliers and retailers to develop eco-friendly raw materials and components while decreasing waste. While initially, their goal may be image enhancement, most save costs or create new businesses as a result - something especially beneficial during difficult economic times when profits need to increase quickly.

Companies develop sustainable operations by analyzing each link of the value chain. First, changes are implemented in obvious areas such as supply chains. Later on, less visible issues like returned products will also be tackled.

  • Supply chains: Most large corporations incentivize suppliers to be more eco-conscious through incentives. Tools like enterprise carbon management, carbon and energy footprint analysis, and life cycle assessment can assist companies in pinpointing sources of waste in supply chains. Life-cycle assessment can be especially valuable: it measures all environmental inputs and outputs across value chains from raw-material supply through product use to returns.

  • Operations: Innovations that increase energy efficiency and decrease dependence on fossil fuels are vital to building a more sustainable supply chain.

  • Workplaces: Due to environmental concerns, some corporations encourage employees to work from home so as to reduce travel time, costs and energy use. This results in reduced commute times as well as energy use. One-tenth of the corporations in our sample had anywhere from 21% to 50% of their employees telecommuting regularly, which increased productivity by 10%-20% and job satisfaction by up to three days per week.

  • Returns: Companies' concerns over cutting waste invariably drive them toward product returns, which have an estimated average reduction in profitability of 4-5% annually in the US. Companies at this stage seek to recoup some of their lost value by reusing returned products instead of disposing of them outright. Not only can this convert a cost centre into a profitable enterprise, but its symbolic gesture demonstrates that companies care more about minimizing environmental damage and waste reduction than cannibalizing sales.

Stage 3: Designing Sustainable Products and Services

At this stage, executives begin to recognize that many consumers prefer eco-friendly offerings and that businesses can gain an edge by being the first to redesign existing products or create new ones that comply with environmentally-friendly requirements. To identify product innovation priorities effectively, businesses need to use skills gained at earlier stages in their evolution as a competitive advantage.

Companies looking to develop sustainable products must understand consumer concerns and thoroughly assess product life cycles, combine marketing skills with their expertise in scaling up raw-material supplies and distribution, and collaborate with nongovernmental organizations on markets outside their traditional expertise.

Smart companies like P&G and Clorox that continue investing in eco-friendly products despite the economic recession see beyond public relations benefits to develop competencies that will enable them to dominate markets tomorrow.

Sustainable practices in software development agencies have gained more prominence as businesses recognize the significance of creating eco-friendly software solutions that reduce resource usage while contributing to an eco-friendly IT landscape.

Stage 4: Generating New Business Models

Many executives misperceive that creating a sustainable business model means simply revisiting customer value proposition and devising ways of providing it; however, successful models include novel ways of capturing revenues and providing services collaboratively with other businesses.

Some companies have created new business models by asking themselves at various points what their business should be. New technologies allow start-ups to challenge conventional wisdom. Exploring alternative approaches and understanding customer needs differently are essential steps towards developing a novel model; executives must learn to question existing models while acting entrepreneurially to develop alternative delivery mechanisms.

Experience will allow companies to reach the final phase of sustainable innovation - in which a product or process's impact extends beyond any market.

Stage 5: Establishing Next-Practice Platforms

New practices require challenging current paradigms. To initiate innovations that lead to the next courses, executives should examine implicit assumptions underlying current practices - exactly what happened during today's industrial and services economy boom.

Sustainability can lead to innovative next-practice platforms. One such emerging intersection of the internet and energy management is the "smart grid." Using digital technology, this platform utilizes power generation, transmission and distribution from various sources along with consumer demand in an attempt to reduce costs while making more efficient use of energy resources. This will result in lower energy bills as well as more effective service.

This concept has been around for some time, but with huge investments being put towards it today, it will soon become a reality. A smart grid allows companies to optimize their energy use with computers, network devices, machinery, telephones and building equipment using meters, sensors and applications; additionally, it enables cross-industry platforms that manage energy needs for cities, companies, buildings and households.

Leadership and talent are indispensable in creating a low-carbon economy. The current economic system places immense strain on our environment while catering to only about one-quarter of its inhabitants, while two out of every ten will soon become consumers and producers. Traditional approaches will eventually collapse; companies must find innovative ways of operating. That only happens if executives recognize one key truth: Sustainability = innovation.

The Technology Eco-advantage

Numerous examples demonstrate how leaders have effectively leveraged new technological approaches to accelerate sustainability transformation efforts.

Digitized Operations

Digitized operations pioneers can set the bar higher by developing more sustainable operations and processes, such as new manufacturing or materials technologies that leverage alternative inputs to reduce emissions and waste, ultimately gaining consumer and investor support. Digitized operations can strengthen resilience; some processes and technologies become industry standards.

Schneider Electric has evolved from an installer of industrial electrical equipment into an international leader in efficiency-as-a-service, earning revenues through CO2 emissions reduction services for customers. The greater Schneider's impact through energy savings and emissions reduction efforts is, the faster its business expands as customers reward it financially and grow the faster it awards its revenues.

Cloud Solutions have quickly become an essential element of modern business operations, as businesses use the cloud to streamline processes, decrease energy consumption, and minimize hardware waste - ultimately contributing to more eco-friendly and resource-efficient IT infrastructures.

Digital Products and Services

Leading companies are forging innovative distribution channels to expand reach, scale, and access for the greater societal benefit at affordable costs - apps that digitize essential goods and services are just one example of such innovative initiatives.

One major city transportation authority recently developed three customer-oriented sustainability solutions that reimagine how parcels are delivered while reducing emissions, improving customer experiences, and driving sustainable growth and profit.

Cloud, IoT and Blockchain Technologies and Tools. Modern digital tools - including connected IoT sensors and monitors, cloud-based data platforms, and blockchain-enabled tracking systems - offer unprecedented capabilities for measuring environmental and social impacts throughout value chains.

Companies can benefit from improving management and investment decisions and performance against ESG goals through value chain transparency solutions that use blockchain technology, for instance, value chain traceability solutions that ensure product integrity from supply source through producer to retailer and ultimately consumer.

AI and Advanced Analytics

These technologies generate data on the environmental and social impacts of products, services, or processes; digital platforms integrate capabilities while sharing data, creating transparency among partners and increasing accountability.

Frontrunners leverage these abilities to develop and refine offerings, engage customers, and continuously enhance performance; IoT and AI-powered solutions can even optimize energy efficiency in real-time to reduce emissions while saving emissions and money.

Data Sharing and Ecosystems

Data sharing fosters new collaboration models within or across industries or sectors to create innovative solutions to environmental and social problems. Companies can more efficiently pool resources, fill capability gaps, enter new markets, and broaden their reach through data sharing.

Software platforms integrating insurance underwriters and telecom providers can deliver microinsurance via phone subscriptions to underserved populations.

Research into the impact of data sharing on major societal challenges has demonstrated its value, creating benefits in five distinct areas. Sharing helps facilitate innovation, build trust among parties involved, facilitate coordination efforts, raise awareness and validate hypotheses; additionally, new science derived from collected data informs the development of next-generation regenerative crop nutrition solutions.

Benefits of Sustainable Technology Adoption for Your Business

Sustainability concerns have gained increasing consideration in CRM development services as businesses recognize the necessity of including environmental principles and ethical data management practices in their customer relationship management strategies.

Here are the advantages of adopting sustainable technologies within your organization:

Protect Your Brand and Mitigate Risks

Scandals can be the stuff of nightmares for CEOs. Not only can improper practices harm an organization's reputation and cost its customers, but dealing with a public relations nightmare diverts precious human and financial resources away from core operations.

No business can afford to become the company responsible for an oil spill or forcing employees to work under dangerous conditions, so adopting sustainable strategies that protect both the environment and employees is important in protecting yourself against potentially costly incidents.

Sustainable Businesses Are Strategic Assets

Sustainability doesn't diminish business goals; infusing your company with purpose can boost financial success by drawing in motivated, skilled workers who support financial gain. Henderson noted a recent study demonstrating this effect: 89% of executives believe an organization with a shared purpose will have greater employee satisfaction. In comparison, 85% are more likely to recommend such companies to others.

Making your company one that does good in the world rather than simply providing paychecks can give your organization an edge when recruiting top talent.

There's a Growing Market for Sustainable Goods

Sustainable Goods Are Becoming More Popular A 2019 study discovered that 73% of global consumers are willing to adjust their consumption habits to lessen the negative environmental impact, with sustainable product sales growing nearly 21% since 2014.

Millennials pay more for products with sustainable ingredients or social responsibility claims, so adopting sustainable products and practices could increase market share by converting sustainability-minded customers and growing sales.

Cooperative Action Can Drive Change

Working alone may seem impossible or too taxing, yet that isn't the case when powerful companies collaborate to solve some of the world's greatest challenges.

While governments struggle to address public goods problems, purpose-driven companies working together have successfully tackled such issues.

Palm oil is widely considered one of the cheapest, most versatile, and cost-effective ingredients available today - used in nearly half of all packaged products such as soap, lipstick and ice cream -. Yet, its production (pdf) has led to record greenhouse gas emissions that contribute directly to climate change.


Sustainability doesn't mean sacrificing profits or postponing success - rather, it has become a central element in any organization's successful strategy. Businesses that don't incorporate sustainability risks in their planning may struggle with profitability, growth and employee retention.

In coming years, sustainability will play an increasingly vital role in corporate strategy and integrating it into corporate planning processes is of utmost importance. There has already been an upsurge in Fortune 500 companies appointing Chief Sustainability Officers (CSOs). Paying attention to sustainability is necessary to meet investor pressure, consumer demand, regulatory requirements, talent acquisition efforts, and increase productivity.

Organizations and individuals are making strides toward sustainability, with organizations and individuals driving this shift and providing effective sustainability strategies. Overall, those pursuing truly sustainable enterprises with carefully planned plans of attack will reap long-term benefits; once the first three pillars have been addressed successfully, additional value becomes unlocked through two posts that drive brand equity and capital structures over time.

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