Harnessing the explosive sustainability power of ICT

Gavin Allen: I'm delighted to be joined by Luis Neves, the Chief Executive of the Global Enabling Sustainability Initiative (GeSI). Luis, the litany of natural disasters that we've seen this year: is that a wake-up call to the world to finally take real action?

Luis Neves: Definitely. But these natural disasters have been happening now for quite some time. I think we are still in a kind of sleepwalking mode. We look at these happenings and see them as part of our normal life. We have not yet reacted in a proper manner, both personally and from a business perspective. 

Gavin Allen: You've got a summit called Digital with Purpose, of which Huawei is a partner and co-founder. What do you want to achieve with this event?

Luis Neves: Digital technologies are fundamental to addressing climate change. Every single piece of research that GeSI has commissioned since 2007 shows that the more we deploy digital technologies, the greater the contribution to lowering carbon emissions.

But from a policy standpoint, we are not seeing enough support for this agenda. There is a lot of focus on the problem side, but we need focus on the solution side. And so we need make this call to the world, to organize the summit. The world will have 10 billion people in a couple of years. It's urgent that we start the conversation about how digital can really help to make this world a better place.

Gavin Allen: Often, because of energy emissions, the spread of technology is seen as adding to the problem. You're saying that ICT and the tech industry is actually an enabler for the solution?

Luis Neves: Digital technologies are the solution for the problems that we are facing. At GeSI, we have been looking at the impact of digital technologies in relation to sustainable development since 2008. The first smart report for GeSI by McKinsey found that digital technologies can reduce a quantity of carbon in various industry sectors 5.5 times greater than the carbon footprint of ICT itself. This is known as the enabling effect.

We've done the same report with different consultancies: in 2012 with Boston Consulting Group; in 2015 with Accenture Strategy. What we saw is that the multiplier changed over time, eventually reaching a factor of 10. So the enabling impact of digital is undeniable. That means the more we deploy, the more we invest, the more connectivity we give to people, the better contribution that we are making to the world.

Gavin Allen: Is it the great untapped, almost unrecognized resource? Are we being too slow to recognize that the solutions are almost in front of our face?

Luis Neves: We are. Policymakers need to pay attention. Had we considered the relevance of digital to address energy consumption, had we invested more, probably we would be much better off today.

Gavin Allen: Huawei has a "more bits, less watts" approach, pushing for digitalization and de-carbonization. Do you think those twin elements are critical?

Luis Neves: Huawei's approach is the right one, although I think Huawei has not really been selling this in the proper manner. This can be promoted, this can be used to better sell Huawei's products into the market and position the company at the global level.

But this is not only related to Huawei. I've been seeing other companies not understanding the potential of the technology for people.

Gavin Allen: What two or three things do you really want to change, to stop the "sleepwalking" you mentioned earlier?

Luis Neves: Policy has been very much focused on the problem side, not on the solution side. So if you look at the European Green Deal, you see a lot of concerns about what kind of legislation needs to be put in place for companies to comply with something. Companies are worried about policymaking, so they pay a lot of attention to how can they respond to policymakers.

Instead, companies could help policymakers better understand the enabling capacity of digital technologies. This shift is urgent, and it will happen faster if companies educate policymakers about the benefit of those technologies. But that work has not been done. 

Gavin Allen: And is this where we come to the topic of carbon handprints: the impact of those technologies on other industries, other sectors?

Luis Neves: Exactly. Digital is not only telco or telecommunications, it is everywhere. The energy sector, the power sector, agriculture, transportation, education, healthcare, and so on.

At GeSI, we ourselves have been, up to now, a kind of telco-driven organization. But we just spent the last three months looking at how we can change, to put digital at the center.

Gavin Allen: So, a much more joined-up approach?

Luis Neves: Exactly. And then if you bring a sustainability mindset together with digital, I think we can create a powerful machine really to drive the sustainability agenda. My ambition is that we move companies away from “the promise” conversation. So, at the climate summit, you have all those companies saying, I'm reducing 20% of my carbon emissions, 30%.

It's a conversation that companies like very much. But it's a bunch of nothing. And so that's one of the key things about Digital with Purpose. We are putting in place a framework that brings transparency to the process and helps companies on their journey to the sustainability agenda.

Gavin Allen: What are you doing with the EU on the carbon handprint to ensure that everyone works from the same metrics?

Luis Neves: The European Commission invited GeSI to develop a European standard to measure the handprint. That's a project that will last at least two years. Around 40 companies in Europe are collaborating with us in developing what will be the measurement solution for the handprint at the European level.

Hopefully, GeSI can eventually apply this at a global level because we are a global organization. We are already talking with different standardization organizations, such as the ITU, about how to apply this globally.

Gavin Allen: Do you think every company, maybe every country, should have a carbon handprint score?

Luis Neves: Well, we need a common measurement. It's fundamental. It will be very difficult for many reasons. But I hope that the end results of our European work can be applied at a global level.

GeSI is a business organization, but we have opened up to different stakeholders. We have universities working with us, and United Nations organizations like the ITU, UNEP, the UN Climate Convention. We have other business organizations like the World Business Council, or the International Chamber of Commerce. We have NGOs working with us, like the Carbon Disclosure Project.

We developed a set of metrics designed to help companies on their journey. And we are not asking the companies, “Okay, tell me if you'll be reducing 20% or 30%.” What we are saying instead is, “Walk the talk, show me how you are progressing.”

We attach the certification model to that with different layers. We call it The Road to the Sky. It's about an ambition. It's about getting there. So if, in 10 years' time, any company is halfway there, it's good.

Gavin Allen: Is there too much focus on a company's footprint, rather than the wider benefits of technology?

Luis Neves: That's what gets me mad. Companies are mostly focused on the footprint. It's nonsense.

Every company should take responsibility for its own footprint; that should be part of the business. But the enabling side, the handprint, is also the business. In Digital with Purpose, we developed both for the footprint and for the handprint for the first time. There is no other framework in the marketplace that takes both things into consideration.

You need to bring sustainability into the DNA of the company, bring it, top-down, to procurement, marketing, sales, product design, and so on. Once you do that, you have the instrument to address the footprint and the handprint. Right now, companies receive lots of different requests from different organizations to fill in metrics: on climate, on supply chain, on privacy, on inclusion.

We put everything together, aiming to give companies a “Digital with Purpose” stamp. That way, every single customer, B2B to B2C, understands this is a good company.

Yesterday I was on a debate with UNEP, United Nations Environmental Program, around what are the requirements to better inform the consumers that this product is green, or is not green. And the conversation was crazy. For instance, on the e-commerce platforms, such as Amazon or Alibaba. Companies are putting their online products and saying “My product is great.” If they are selling a laptop computer, they say, ‘My laptop is more energy-efficient than the others.”

But the green dimension of the product is not only about the product’s energy-efficiency. You have to consider many other factors.

Take a product like cosmetics. Say a given company sells cosmetics online as a green product, because they have put a couple of measures in place. They explain this to their customers. But if I buy that, and have it delivered to my home overnight, it's no longer a green product.

That's why we need a different approach.

I'm very happy Huawei has joined this process. It is a journey that will take us a couple of years. But I'm convinced that in 10 years' time, we all will be much better off together.

Gavin Allen: We will be heading to the sky, as you said. But one of our core mantras is about connecting the unconnected. We've talked a lot about digitalization. But how important is it to bridge the digital divide? If you're going to have a sustainable, green future, how critical is that connectivity that benefits everyone?

Luis Neves: Connectivity is the fundamental piece of the conversation. Without it, we're not going anywhere. Twenty years ago, the telecommunications sector was a public sector, and we were talking about “universal service.” There was a requirement to provide communication to anyone. It was a right.

That right has disappeared to some extent, and we live now in a competitive environment – which I think is good. But in this environment, we need to create the conditions for companies to apply technologies all over, for everyone. Otherwise, we'll be lost.

Gavin Allen: How do you make sure no one is left behind? How do you connect the unconnected?

Luis Neves: From a policy standpoint, you need to create the conditions for the companies to invest in less profitable markets. For example, if you do not provide connectivity to farmers, you cannot apply intelligent technologies to agriculture. You cannot reduce water consumption, you cannot control the crops, and so on. So, policymakers need to create the conditions for the private sector to invest in remote areas where connectivity is needed. Telecommunications are basically a universal right, and everybody should be connected.

Gavin Allen：So are we losing sight of those who are potentially left behind?

Luis Neves：We are. Once you provide connectivity, you are also providing the fundamental conditions to reduce carbon emissions. In 2017, we did a study about the impact of not having connectivity across the world. And the conclusion was that we were losing per year 7% of the world’s GDP. So we're losing a lot of money.

Bottom line: We're not providing communications to those in need. GeSI developed a Digital Access Index showing where 156 countries ranked with respect to technological development. Countries that have no connectivity are at the bottom of the index. They are the least developed countries, without education, without proper health. 

Countries at the top, like Germany, Sweden, and so on, with full connectivity – they prosper, they grow. We need to bring that to every single country. But if you go to a climate summit, you don't hear anything about digital. It's simply foolish. I do not understand why digital is not at the core of the climate conversation. They talk about the oil industry, but we know those industries are polluting and there is a need to change. But digital can be the agent of change.

Gavin Allen: You've talked about sustainability as a cash cow for businesses. How do you get businesses to recognize that this isn't a burden, this is a massive opportunity for them?

Luis Neves: That's a good question and very difficult to answer, because companies are very much focused on short-term profitability, maybe because they have to be accountable to their shareholders. But what we have seen in reports like GeSI Smarter 2030 is that efficiencies around digital technologies applied to electric power, agriculture, transportation, e-commerce, buildings, just to name five industry sectors, would generate a benefit of $11 trillion. Why are these companies not looking into that?

Gavin Allen: Why isn't there even more investment in digital? What is holding investors back?

Luis Neves: I knock my head against the wall to understand that. If the companies think with purpose, they would probably give the answer to your question.I do not see many CEOs that are purpose-driven. A CEO of a company can only be accountable to shareholders. But the company is part of society. It has a responsibility towards the society. Part of the CEO role is to understand that.

Digital with Purpose is a CEO-driven movement. And if we get the commitments from the CEO to the movement, we can accelerate the process. And one of the things that we have in the movement as well is that we will not be allowing for any greenwashing.

Gavin Allen: It's a commitment.

Luis Neves: It's a commitment. If they are not progressing, we throw them out. We don't want them. Either they progress or they have to leave. That's the way we can transform and accelerate.

And I think this is probably the answer to your question. It's about how do we make sure that the CEOs understand the benefit of digital and sustainability combined. Because this is an atomic bomb, actually, that we could use to put the world on track. If you think about the world with 10 billion people in 30, 40 years' time, we need fundamentally to change the way that we are operating. We cannot continue on with business as usual.