Microsoft/Kyndryl: Why Firms have Climate Intent, not Action

Only 16% of companies are successfully incorporating sustainability in their corporate strategies. 

This is one of the key takeaways from Microsoft and Kyndryl's Global Sustainability Barometer. The study examined 1,500 sustainability and technology leaders from 16 countries to explore the disconnect between climate intention and action as progress in sustainability initiatives continues to slow down.

Faith Taylor is the Global Sustainability and ESG Officer at Kyndryl, the world’s largest IT infrastructure company. Operating in 63 countries, Kyndryl has more than 80,000 employees and serves three quarters of Fortune 100 companies. Under Faith’s leadership, the company is committed to its goal of achieving net zero emissions by 2040 and other SBTi approved sustainability initiatives. 

Prior to Kyndryl, Faith was the Global Environmental Social Governance (ESG) leader at Tesla where she worked with its Board of Directors, investors and leadership teams to develop its strategies, structures and targets. Before joining Tesla, she served as the Senior Vice President, Corporate Social Responsibility and Chief Sustainability Officer (CSO) of Wyndham Worldwide from 2005 to 2018. Business Chief and Sustainability magazines have ranked Faith in the Top 100 Women in Sustainability list for many years.

This Earth Day, Faith chatted with Sustainability Magazine to discuss Kyndrl and Microsoft’s findings and the next steps for leadership teams looking to drive real, impactful action – not just intent.

Climate intention vs action - what does this mean, and what trends are we seeing in executives? 

When I speak to CEOs and other Chief Sustainability Officers, I hear a common theme of where leaders are in their journey, and where they want to go in the next few years. 

Many organisations have large climate and emissions goals in place to reduce impact globally – but they are finding it challenging to meet their pledges, intentions and goals due to any number of macro-economic and external factors, including evolving regulatory and economic factors. 

For companies to move from intention to action, they must think beyond regulatory compliance to pragmatically execute and advance their sustainability goals. This includes:

• Understanding and addressing a company’s overall risks and impacts
• Setting quantifiable, trackable third-party validated targets to measure against
• Leveraging technology as a key enabler to sustainability success, and its role will only continue to grow with the advent of more sophisticated AI tools and solutions to reduce carbon footprints across IT environments
• Being bold and leveraging strengths and partnerships to create innovative action and breakthroughs.

What opportunities does technology offer for sustainability and how can it help leaders achieve their sustainability goals?

Kyndryl’s recent study “From Vision to Impact: The Global Sustainability Barometer” aims to bridge the sustainability-technology divide and provide insights into the role of innovation, data and AI in achieving an organisation’s sustainability ambitions. Of note, while 80% of organisations acknowledge technology’s crucial role in achieving sustainability goals, only 32% feel they effectively harness its full potential.

There is an opportunity for green IT initiatives to extend beyond reducing carbon emissions from IT infrastructure. This broader scope includes minimising emissions from various IT operations – including procurement, management, and disposal. 

The true value of a tech-driven sustainability program emerges when organisations harness technological advancements to foster innovations. For instance, while 61% of organisations use AI to monitor energy use, only 34% use current data to predict future energy consumption. 

AI can offer great value to businesses as it’s being used today to help automate sustainability measurement, and it can be used in the future for more predictive analytics that assess Scope 3 risks, forecast energy consumption and anticipate potential risks such as natural disasters. Deploying AI, you also have to implement sustainable solutions to minimise your overall environmental footprint.

Additionally, to meet today’s demanding data and application needs, migrating to cloud networks will also help companies advance sustainability goals. For example, organisations migrating from on-premises network hardware to cloud-based services using renewable energy can decrease related carbon emissions between 78% and 96%.

What are leaders saying the barriers are to achieving meaningful sustainability action?

Sustainability is a strategic imperative that has the attention of the C-suite yet there is a disconnect between the use of technology and alignment within the organisation. This includes not only aligning with finance but also empowering employees with concrete objectives. 

Companies are in varying stages of their sustainability journey, and everyone can agree that there is still much work to be done. In order to make sustainability a priority, companies should consider the following best practices:

• Make sustainability a CEO and Boardroom priority aligned with finance and technology. Of those companies that have implemented sustainability for more than 10 years, only 24% have full alignment with finance and 44% with technology.
• Align sustainability with technology modernisation. Competing demands from customers, investors and regulators have created challenges in prioritisation. Of the respondents surveyed, 52% use automation to improve efficiencies and build sustainable operations, while 48% digitise their workplaces to support a hybrid work strategy and 47% use technology to reduce the environmental footprint of their organisation. Prioritise projects based on your company’s sustainability commitments and long-term business growth plans.
• Simplify complex data terrain. A mere 15% of organisations have the capability to provide their employees with real-time sustainability dashboards. Streamlined data management is crucial for informed decision-making and successful execution of strategies.
• Unleash AI for predictive sustainability. Expand the use of AI beyond reporting to include predictive analytics. Today, only 31% of companies (based on those responding to the study) identify Scope 3 risks, 34% predict future energy consumptions, and 29% predict and prepare for natural disasters.
• Empower employees. The study found that 48% lack dedicated resources or limited internal expertise, which outlines the need for additional workforce development. Go beyond education and awareness-raising efforts to empower employees by giving them concrete sustainability objectives.

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