Why AI has Made NTT Data Tweak its Sustainability Strategy
NTT Data has overhauled its sustainability materiality framework, introducing 13 new priorities across environmental, economic and social dimensions.
The Japanese tech services giant cites the need to respond to rapid shifts in its business landscape as the reason for this change.
The revised framework organises the firm's ESG priorities under three pillars: Planet Positive, Prosperity Positive and People Positive.
- In sustainability, materiality refers to the most significant ESG issues for a company and its stakeholders. Identifying its materiality allows an organisation to prioritise the sustainability topics that matter most, allowing them to focus their strategy and reporting on the areas that could impact their financial performance, or have a genuine impact on people and the environment.
Key additions include water management, responsible technology and AI ethics and digital accessibility.
The company says the update reflects its full integration with the NTT parent company, which significantly expanded its data centre operations, as well as the rapid proliferation of AI technologies more generally.
"It has become increasingly important to consider the impact that NTT DATA has on its stakeholders," the company stated in its announcement.
The previous materiality framework was established in 2022 under the medium-term management plan titled 'Realising a Sustainable Future'.
Environmental priorities at NTT Data
Under the Planet Positive pillar, NTT Data has identified climate change, circularity and water management as three of its core material topics.
The inclusion of water management may be driven by the resource-intensive nature of data centre cooling systems.
Data centres are significant consumers of both energy and water, with facilities using millions of litres annually for cooling infrastructure.
The Prosperity Positive pillar encompasses innovation through technology, responsible technology and AI ethics, sustainable supply chain management, digital safety and reliability and secure and sustainable-by-design services.
This emphasis on AI ethics comes as governments worldwide grapple with regulating artificial intelligence deployment.
The People Positive pillar addresses workforce and social issues, including diversity and inclusion, health and safety, human rights and digital accessibility.
Sustainability track record under scrutiny
NTT Data's sustainability credentials have been developing alongside its US$30bn global operations.
The company serves 75% of the Fortune Global 100 and employs staff across more than 50 countries.
As part of the broader NTT Group, the organisation benefits from an annual research and development budget exceeding US$3.6bn.
However, the materiality update arrives at a critical juncture for technology companies facing mounting pressure over environmental impacts.
Data centres already account for approximately 1.5% of global electricity consumption according to the IEA, a figure expected to rise rapidly and substantially in the coming years as AI investments increase.
NTT Data's integration with NTT Ltd. has may have increased its exposure to these sustainability challenges.
What does the future hold for NTT Data's sustainability?
The revised framework signals NTT Data's attempt to align its sustainability strategy with evolving operational realities.
Whether these changes translate into measurable environmental and social improvements remains to be seen.
The company has committed to promoting sustainability management based on the new materiality framework.
Success will likely depend on how effectively NTT Data embeds these priorities into its data centre operations and AI development practices.
The technology sector faces increasing scrutiny from investors, regulators and customers demanding greater accountability on sustainability claims.
