How sustainability will drive industry transformation
Managing Director for Global Sustainability
A century of increasing global industrialization created the woeful unintended consequence of crippling greenhouse gasses in our atmosphere. Now we have far less time than that to address this crisis. We have to reduce emissions five times faster in this decade than we have been over the last. How do we speed up the action?
Awareness is no longer the issue. On Monday the Intergovernmental Panel on Climate Change (IPCC) issued its latest assessment since August 2021. The IPCC, which reviews and synthesizes thousands of scientific papers on the current effects of climate, stated that “climate change is a threat to human well-being and the health of the planet. Any delay in concerted global action will miss the brief, rapidly closing window to secure a liveable future.”
Those catastrophes add to an urgency that companies around the world already know. In 2021 a joint report from the United Nations and Accenture that surveyed more than 1,200 chief executives worldwide found that nearly half of CEOs said extreme weather was seriously affecting their supply chains, and 81% said that they were already developing new products and services leveraging electrification, sustainable design and sustainable materials.
I have worked with companies on issues of climate and sustainability for many years, and can attest to this new urgency, both in the scientific reports and in the awareness among business leaders – it’s an industry transformation. We’re seeing coalitions of CEOs coming together to unlock barriers in the system and sharing data. The companies that embrace sustainability as core to their business, will be the ones that move ahead. This is the Decade of Action.
But how can things move faster? Leadership, collaboration and technology to attack the problem and unlock new business models are all a key part of the solution.
The CEOs I've seen steering policy, winning customer and employee loyalty, and mastering exciting new innovation and business challenges share a passionate and personal drive. Sundar Pichai has said climate change is the biggest challenge we face and one that will affect all of us, in deeply personal ways. At all levels of power, leaders speak of the personal effect climate change is having on them, whether it's in the destruction of a beloved landscape, woe as they contemplate what their grandchildren's world might resemble, or the frustration they hear from employees keen to do more.
Astonishingly, in a supposed era of the faceless corporation, the personal passion of leaders, their impatience and intolerance of the status quo, is a power determinant of progress and success. Leaders with conviction, and who are competitive in creating new business models that incorporate sustainability, will be at the forefront.
Next, collaboration. There is an enormous reset of relations going on because of climate change. We see it happening among nations, between governments and business, and with companies and their partners, customers and employees. Businesses can’t solve this on their own. They need to work with their supply chains to get full visibility of impacts, they need to work with customers and investors to support their business model transformation and they need to work at an industry level to ensure the rules of the game enable these new models. This is an opportunity to find new bases for cooperation, new shared goals, new standards and metrics by which to judge success. These happen best when all parties operate transparently and with a shared commitment to solving one of the most complex problems humankind has known.
Lastly, better data and technology. As strange as it may sound, COVID may have indirectly had a positive impact in the fight against climate change, since it showed how quickly individuals, governments, and businesses can change the way they operate. A great aid in this has been digital technology. Business will be at the heart of this transformation and technology will be a key enabler — through new cleaner energy sources, electrification of mobility but also through smarter, more efficient ways of working enabled by digital technologies. It will be imperative for companies to have better visibility into their data so that they can make more informed, impactful decisions – the underpinning of the sustainability transformation is data.
Unlike earlier industrial processes, digital technology enables far greater measurement of environments, processes, and remediation. That means we can analyze more complex systems, and see impacts as they happen, in system-wide views. The larger amounts of software, even in areas like manufacturing and transport, means that systems are more flexible too, adjusting to changing conditions.
I recently joined Google Cloud because I believe the Digital Era can remediate the unintended consequences of the Industrial Era. Cloud computing focuses the sensors, analytics, and software engineering of the Digital Era in the most efficient manner possible. We can optimize existing systems, and enable large system changes that extend to everything from product life extension to energy system flexibility and smarter distribution, along with sourcing and manufacturing that is fairer to populations in many parts of the world.
Google Cloud operates both the cleanest cloud in the industry today, and is offering new products, services, and research to make even more dramatic improvements ahead. At the highest level, Google’s 24/7 carbon-free energy goal by 2030 is working towards a dramatic reconfiguration of the global energy grid so we and others can run entirely on carbon-free sources less than eight years from now. Every utility and partner that joins us, and every company using Google Cloud, adds strength to this global mission.
There are a number of related issues that will involve greater use of cloud-based sensors, computer-driven climate models, Machine Learning, and AI. This might be the worsening duration and severity of wildfires because of climate change, an issue we've been addressing with AI to better track and predict fire. There are challenges to biodiversity and environmental integrity, something we've worked on with Unilever and both governmental and nongovernmental organizations. At an individual level, we're building tools in search and software development that help companies grow their business with the lowest environmental impact.
It’s a combination of macro solutions, and micro behaviors. There are existing systems to improve, and entirely new things to envision and build. No single entity has all the answers, just as no single effect brought us to this crisis. Rather, it is a systemic view of the world, and a desire to act in more positive ways, that can help us move faster into healing. This is a transformation agenda, and Google Cloud brings the scale, reach and data that helps customers transform. Ultimately, the sustainable option becomes the better option.