The environment, and humanity’s role in contributing its damage, is hot news these days.
A flurry of damning scientific analyses, celebrity appeals and huge swathes of Australia consumed by infernos has dragged the issue onto front pages, headline stories and even specific political leader debates. It has taken millions of people to the streets in protest and, as of 2018, according to The National Centre for Social Research, nearly a third (31%) of British 18-34 year olds are “very” or “extremely” worried about climate change.
For businesses, it means a renewed focus on demonstrating to customers and partners that they are taking sufficient measures to lower their own carbon footprint. There are various ways different companies are working to make their own operations ‘greener’ and a primary one, is thinking differently about the suppliers and partners they use.
As more and more companies are choosing to store their servers in external data centres, a key factor they’re looking at is how sustainable these data centres are. This inevitably leads to a nagging question; how green is your data centre?
The role of ESG
ESG (Environmental, Social and Governance) refers to the three central factors in measuring the sustainability and societal impact of an investment in, or activity of, an organisation. These criteria and the practices that originate from them have become central to how businesses pursue growth objectives, engage employees, support customers and minimise impact on the environment.
The rise of ESG as chief tenet within commercial methodologies has been remarkable. In 2000, the Global Reporting Initiative (GRI) was launched to improve corporate disclosure on ESG issues and the standards outlined within are now used by approximately 80% of the world’s largest corporations. Meanwhile, investment in ESG activities and initiatives is now estimated at over $20TN in AUM.
ESG playing such a central role in corporate decision-making puts added pressure on businesses that currently have no procedures of their own. As companies look to boost their own ESG credentials, they instinctively look towards suppliers and partners who can demonstrate strong ESG credentials themselves, overlooking those that can’t. It’s a pattern that can be observed across lengthy supply chains.
With data centres consuming around 416 terawatts of power a year, or to put it in more startling terms, circa 3% of all electricity generated on the planet, they are facilities that many businesses are looking to for more than just connectivity. They’re looking to them to boost their own ESG credentials, if indeed they can…
When to give a data centre the green light
As illustrated above, data centres consume rather a lot of power, so it’s vital to look first at how the power they consume is being generated.
Many facilities obtain their power from coal and gas-fired power stations which are heavy contributors to carbon emissions. If ESG is high on your agenda, look out for those facilities deriving 100% of their power from renewable sources. They do exist.
100% renewably sourced power is the most important factor when deciding on a facility that will support your own ESG policy, but it isn’t the only one. Look also at the culture encouraged within the data centre business. To what extent are staff, clients and suppliers kept aware of the environmental impacts their core operations create? Is responsible performance and practice assessed and monitored against environmental objectives and how stringent are these objectives? Ask them what they can do to support you in greener endeavours. For example, access to charging stations for Electric Vehicles on the data centre grounds means you can actively engage in an increasingly desirable ESG practice.
The answers to these questions will provide important insights into how seriously the data centre complies with its own ESG standards and thus how it can complement yours.
There are also highly respected and influential bodies and initiatives that only the most environmentally conscious data centres will engage with. Amongst the most stringent are the EU Data Centre Code of Conduct so it’s worth looking into whether your prospective data centre adheres to their standards or those of similarly revered initiatives.
More than just ESG bonus points
As briefly highlighted earlier in this piece, companies are more and more checking the ESG credentials of partners and suppliers before committing to new business relationships. However, it’s important to appreciate that it’s not just other companies that will be looking at your own practice, your customers will too.
American-based data and research company, J. Walter Thompson, conducted a survey of consumers in the UK, US, Australia and China. The findings showed that 89% of those surveyed ‘care personally’ about protecting the planet, 83% would always choose a brand with a better record of sustainability; and 90% agreed that companies/brands have a responsibility to take care of the planet and its people. Perhaps most revealing; 70% of respondents reported that they would be willing to pay morefor products and services if they protect the environment and don’t infringe human rights.
In other words, using a green data centre and appropriately advertising that fact, won’t just boost your appeal to other companies, it can boost your appeal with new customers as well.