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How India is moving towards net zero

Home-grown companies and multinational firms are doubling down on sustainability efforts, but more needs to be done to improve datacentre efficiency and avoid greenwashing

As the world’s third-largest greenhouse gas producer and a global node for technology innovation, India has been encouraging firms operating in the country to reduce their carbon footprint for some time now.

Home-grown companies such as Reliance Industries, HDFC Bank have pledged to reduce their carbon footprint as early as 2030, while multinational firms including Cisco and SAP have doubled down on sustainability initiatives in the country.

Take Cisco’s Bangalore campus, for example. The entire campus is powered primarily by renewable sources, and the company has gone from using 2% renewable energy in 2015 to 66% in 2021.

Anand Patil, senior director for systems engineering at Cisco in India and the South Asia region, said addressing climate change is a long-term strategic priority for the company.

“It is not just a risk to be managed, but also an opportunity to assist the global transition to a low-carbon future,” said Patil, noting that Cisco recycles and reuses 99.9% of products that are returned to it free of charge.

“Most importantly, we are also continuously working on improving the energy efficiency of our products, saving energy and reducing carbon emissions for our customers and ourselves.”

SAP, meanwhile, aims to be carbon neutral across its operations in India by 2023. It has also partnered with the Energy and Resources Institute to help India achieve sustainability in key industries, service delivery and government.

Forrester recently analysed the environmental sustainability strategies of 50 large organisations in Asia-Pacific (APAC), including nine large Indian firms across manufacturing, financial services and retail.

Of those, six have named a sustainability lead, which is on a par with the regional average, though Indian firms lag behind their regional peers when it comes to committing to direct and indirect emissions reduction targets and a date to be carbon neutral or net zero. 

IT services firms are taking the lead, however. Both Tata Consultancy Services and Cognizant, for instance, have pledged to be carbon neutral by 2030 via a combination of emissions reductions and carbon offsets.

More work to be done

Ensuring datacentres are sustainable is critical for organisations in India to achieve their carbon emissions targets.

“Datacentres are critical to the future of India and have always been looked down upon due to their excessive energy consumption and increasing carbon emissions,” said Keshav Kumar, general manager of datacentre presales at Rahi, a global systems integrator.

Citing research from commercial real estate services company JLL, Kumar said India’s datacentre capacity could double from 499MW in 2021 to 1GW by 2023, potentially enlarging the country’s carbon footprint if datacentres are not managed efficiently.

Michael Barnes, vice-president and research director at Forrester, noted the role that IT functions play in helping organisations reduce their datacentre carbon emissions.

“Optimising IT infrastructure and operations presents massive opportunities, including accelerating migration to cloud and optimising consumption with active hardware and software management,” he said.

To Ashish Agrawal, managing director of technology service provider Nagarro, the sustainability of IT infrastructure has been ignored for too long as IT services is traditionally not seen as a heavy-emissions industry.

“But every text, video stream and virtual meeting has a carbon impact and creating awareness around the choices we make is important,” he said.

For datacentre operators, those choices centre around energy and water, both of which are required to run their facilities and provide suitable internal conditions such as temperature and humidity.

“Running closed water systems for cooling in datacentres and powering them with renewable energy must be the default as we move into a more digital future,” said Agrawal.

He also pointed out an oft-forgotten area of carbon impact – laptops. “As the world becomes more affluent, everyone wants a new laptop without regard for what that entails and what happens to their old devices,” he said. “Radical transformations are required at the policy level and at the consumer level to encourage repairability and recyclability in laptops.”

Beware of greenwashing

With more consumers now expecting firms to undertake environmental, social, and governance (ESG) efforts, companies that feel pressured to act quickly could misrepresent or overstate their actions.

“Misrepresenting your firm’s environmental sustainability policies and actions will result in customer backlash, loss of brand credibility and trust, and, potentially, fines,” said Forrester’s Barnes.

“In fact, Forrester expects at least 50 firms in APAC to be penalised for performative ESG efforts in 2023. Offenders could face penalties of $10m or more as APAC regulators follow the footsteps of their US and European counterparts and clamp down on misleading ESG claims.”

Barnes added: “Avoid greenwashing by acting with authenticity, openness and transparency at all times, and acknowledge your mistakes with empathy and courage.”

The lack of measurement and standards around ESG does not help, either. A recent study by Oxford Economics and SAP found that while 62% of Indian businesses said it is not difficult to be sustainable and profitable at the same time, just 17% have calculated their total carbon input. And among those that have acted on a sustainability strategy, only 7% are receiving significant value from it.

Agrawal said: “If we are to create a global accounting system to measure the journey towards net zero, we need some level of uniformity in how we collect and process data and the meaning we derive from that.

“Using a global standard or one accepted industry-wide is essential in the collaborative path towards the Paris Agreement. Using a standard format for measurement also helps maintain consistency over the years to be able to understand your own journey in terms of the progress made and lessons learned.”

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