Technology will be critical to fulfill
upcoming sustainability regulations; most executives say
improvements are needed to existing systems
BOSTON, May 1, 2024
/PRNewswire/ -- New research from Bain & Company,
published today, finds just 24% of companies say they are ready for
upcoming sustainability reporting requirements—a potentially
worrying statistic as it can take years to build the needed
capabilities, such as the technology necessary for collecting,
analyzing, and reporting sustainability data.
Bain surveyed more than 300 executives, with nearly 90% agreeing
improvements in digital technology are critical for advancing their
sustainability goals. However, most say that they are not taking
the actions needed to make that happen.
Bain's findings come as the global regulatory landscape rapidly
shifts and expands, and as companies are under pressure to
anticipate additional reporting requirements. The EU's
Corporate Sustainability Reporting Directive mandates that EU
companies start reporting on their greenhouse gas emissions and
other environmental factors by 2025. In California, large companies will need to
report on Scope 1 and Scope 2 emissions by 2026, and Scope 3
emissions by 2027—not far off, considering the time it takes to put
these systems in place.
"Technology will be essential for companies to meet their
sustainability commitments and ensure compliance as regulations
evolve," said Adam Cox, Bain &
Company partner and member of the firm's Enterprise Technology
practice. "In addition to carbon emissions, companies need to be
prepared to address other aspects of sustainability, such as water
use, waste management, and supply chain ethics. Doing so will
require companies to invest in new technology systems, often
accelerating existing initiatives to modernize their IT."
Deploying technology to meet sustainability
goals
Bain's research found that enterprise technology
typically represents about 25% of a company's Scope 1 and 2
emissions. Large data centers can consume as much as 5 million
gallons of water daily, and end user devices, such as laptops, can
contribute to a company's electronic waste load. Developing systems
to minimize these impacts helps to build the capabilities that will
serve the entire organization.
Beyond IT, enterprise technology is critical for monitoring and
analyzing the data that executives depend on to understand
baselines and set ambitions. Companies will need to set
sustainability goals that align with the existing technology
roadmap. Sustainability objectives can help turbocharge the
business case for modernizing legacy technology and migrating to
cloud workloads, so it makes sense to align the efforts.
A path forward
Only about one-third of the executives
Bain surveyed with high sustainability ambitions believed that they
have the technology necessary to deliver on them.
"Technology can become the bottleneck preventing companies from
delivering on their sustainability objectives," said Cox. "Leaders
in this space have been investing in custom solutions to support
their sustainability efforts for more than a decade, and most
companies just getting started know they have some catching up to
do. Speed will be critical for companies looking to tap
sustainability as a competitive advantage."
Media Contacts:
Gary Duncan (London) — Email: gary.duncan@bain.com
Katie Ware (New York) — Email: katie.ware@bain.com
Ann Lee (Singapore) — Email: ann.lee@bain.com
About Bain & Company
Bain & Company is a global consultancy that helps the
world's most ambitious change makers define the future.
Across 65 cities in 40 countries, we work alongside our clients
as one team with a shared ambition to achieve extraordinary
results, outperform the competition, and redefine industries. We
complement our tailored, integrated expertise with a vibrant
ecosystem of digital innovators to deliver better, faster, and more
enduring outcomes. Our 10-year commitment to invest more than
$1 billion in pro bono services
brings our talent, expertise, and insight to organizations tackling
today's urgent challenges in education, racial equity, social
justice, economic development, and the environment. We earned a
platinum rating from EcoVadis, the leading platform for
environmental, social, and ethical performance ratings for global
supply chains, putting us in the top 1% of all companies. Since our
founding in 1973, we have measured our success by the success of
our clients, and we proudly maintain the highest level of client
advocacy in the industry.
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SOURCE Bain & Company