Facing the Heat
- 06 August, 2007 13:26
As a matter of personal belief, any CIO is free to count themselves among the tiny and diminishing band of troglodytes that would continue to deny the reality of human-induced climate change until the polar ice caps disappeared and the landscape was reduced to dust. Individuals can believe anything they want, including that the universe was sneezed out by a being called the Great Green Arkleseizure or that George W Bush is a great president.
However, with global warming soaring to the top of the political and social agenda (and Peak Oil vying for space), the organization that employs the CIOs does not have that luxury. Shareholders and board members are starting to press their companies to go green as the harsh clamour of community expectations holds their feet to the forest fire and demands swift and credible action. Organizations that make like an ostrich are likely to find their nether-regions ever more dangerously exposed.
Line all those ducks up in a nice green eco-row and with any luck you can be a hero who simultaneously helps save the planet and the future prospects of your employer
For instance, after GE deployed its digital cockpit — a $US10 million system that supplies metrics on environmental performance, resource use, safety and compliance — it substantially cleaned up its act, reducing violations of wastewater emission regulations by more than 80 percent in a decade and saving tens of millions of dollars through environmental, safety and productivity improvements.
US company AISO, which describes itself as a "responsible green Web hosting company" and has customers around the globe, is saving $4000 a month by running its data centre and office entirely off solar panels. The company, which maps its IT purchasing decisions back to its overall efforts to be environmentally responsible, has been generating 50 percent less heat and using 60 percent less energy since migrating to AMD's Opteron-powered servers.
Dow Chemical Company estimated it would spend $1 billion on technology and processes to save $3 billion in reaching its 2005 Sustainability Goals, but ending up saving $5 billion through a combination of rising energy prices and better use of its resources, including energy efficiency.
And back home Australian company Investa, included on the third Global 100 (G100) list of the most sustainable corporations in the world and named one of the leading companies on the Dow Jones Sustainability World Index (DJSI World), is saving $1.7 million a year, with a combined return on investment of 61.7 percent, through its energy and water programs.
"Over the past two years alone, Investa has reduced water consumption in our commercial office buildings by 28 percent through a number of new initiatives," Craig Roussac, Investa's general manager, sustainability, safety and environment, said in a statement. "We have been able to demonstrate a 'hard dollar' increase in a property valuation due to improvements in a building's environmental performance. This supports our long-held view that superior environmental performance can create value over and above mere cost savings."
Energy, wastewater and Internet service provider to the Australian Capital Territory ActewAGL, while admitting there is a long way to go before any Australian organization can claim its technology use to be carbon-neutral, is saving energy and money by running Citrix terminals and making sure staff turn off their machines at the end of the day and helping the environment by running its data centre entirely on green power.
Page Break
And let's face it, if you don't take action voluntarily, you are bound to be dragged to it kicking and screaming sooner or later — and later is likely to come at far greater cost. Already in Europe and to a lesser extent in the US, corporations are being subject to a host of environmental regulation and the brutally critical appraisal of an increasingly anxious public. Whatever the results of the upcoming federal election, Australian businesses are unlikely for long to remain free of demands that they drastically reduce their carbon footprint. Nor should they be allowed to, as long as their data centres suck power like humongous vacuum cleaners and their discarded electronics spew toxic metals and other pollutants into the environment.
Does this sound like an exaggeration? It isn't. In 2005, total data centre electricity consumption in the US, including servers, cooling and auxiliary equipment, was approximately 45 billion kWh, consuming as much as all colour televisions in the county and using as much power as the entire state of Mississippi, according to a recent survey by AMD. That is the total output of five 1000-megawatt coal power plants. And that usage is soaring exponentially, with the power usage of data centres having doubled between 2000 and 2005.
In the next three years, individuals and organizations worldwide will replace more than one billion computers. The average mobile phone in the US is replaced after just 18 months, and more than 75 percent of all computers ever sold remain stockpiled in our closets, garages, office storage rooms and warehouses. "After years of helping global organizations manage the recycling/disposal/remarketing of retired IT assets, the days of companies turning a blind eye to proper IT asset disposal are over," says Chris Adam, NextPhase director of IT asset management solutions.
Consumers Will Decide
The article "Competitive Advantage on a Warming Planet" in the March issue of Harvard Business Review points out that whatever your industry the numerous risks associated with global warming are affecting your business, from tough emission-reduction legislation through to a damaging backlash from consumers concerned about the environment to weather-related damage to physical assets.
"Consumers are increasingly taking your environmental record into account when they make purchasing decisions. And investors are already discounting share prices of firms poorly positioned to compete in a carbon constrained world," authors Jonathan Lash and Fred Wellington say.
However, they add that the risks of climate change also offer new sources of competitive advantage for companies prepared to measure their firm's contribution to global warming, assess their climate-related risks and opportunities then reinvent their business — before rivals do — to mitigate those risks and seize the opportunities.
Environmentalist and former US vice president Al Gore recently implored an audience of Silicon Valley executives and technologists to use their collective knowledge and resources to promote green technology that causes less pollution and can reverse the effects of climate change. "The world faces an unprecedented challenge and Silicon Valley can make an unprecedented contribution to meeting that challenge," Gore told them. "You can chart a course and change the future of civilization."
Page Break
That line of reasoning applies to CIOs as much as IT vendors and software companies, and some industries are already rising to the challenge.
"In Australia, the prolonged drought has brought a greater focus on the issue of global warming and long-term sceptics are announcing a change of heart," says Leith Campbell, principal consultant at telecomms, software and IT consulting firm Ovum.
Lawson Software vice president of marketing Jeff Frank predicts responsibility for green business practices will eventually be placed squarely in the lap of the CIO. Like any other business problem, the organization initially tries to manage its eco-responsibilities in a piecemeal, fragmented and manual way before realizing that that approach does not work, he says. When things start to fall apart they then turn to IT and the CIO to lead the charge on managing programs and bringing information together in the interest of better decision making.
"Ultimately, the CIO is going to really be one of the driving forces behind how companies manage their green business practices and corporate social responsibility programs," Frank says. "What CIOs should expect from their business application providers are really the tools to bring together the fragmented programs that they're trying to manage today into an integrated dashboard that would allow the CIO and decision makers across the company to better manage their CSR [corporate social responsibility] and green business practice in a more integrated manner."
And they should also expect and be prepared to change their own approaches and thinking. "When a CIO decides to go green in response to global warming, a change in thinking needs to precede a change in corporate decision making," says Judah Freed, the author of Global Sense. "A chief information officer familiar with general systems theory already thinks of his or her organization as an interconnected network. Going green means seeing that organization interacting within the wider planetary system, so the green CIO wants to ensure the information network truly makes global sense.
"Beyond videoconferencing instead of air travel, beyond component recycling instead of throwing away obsolete computers and other enterprise technology, the CIO can choose among a range of options," Freed says.
But as Chris Homer, vice president sales and marketing and legislative affairs with environmental management software solution company EnvironMax, notes, any efforts by the CIO will go nowhere without support from the top. "The first and most critical requirement is for a CIO to make it a point to secure executive buy-in and subsequent budgetary commitments to green initiatives," he says. "In my experience, technology funding for environmental issues within corporations is almost always at the bottom of the list. Companies don't fund green initiatives — generally speaking — until there's a problem, such as EPA or OSHA [Occupational Safety and Health Administration in the US] fines, or a PR-based need, such as consumer or environmentalist-based complaints or concerns, for change.
"The handful of CIOs who are visionary in this area, and make the effort and proactive commitment to the environmental impacts of their organizations, are the ones who are well ahead of the game in terms of positively affecting the environment, presenting their companies as good citizens and realizing cost savings and bottom line positive results to their financials," Homer says.
Technology companies have of late been focusing more on green technology: designing computer processors that generate less heat, building systems that better manage electricity use in data centres and improving manufacturing processes and recycling old computers. The non-profit consortium called The Green Grid, with its blue-chip list of charter members including Intel, AMD, Sun, IBM and VMware, has released guidelines on energy-efficient data centres, even as TechNet — a network of tech company CEOs — looks to enhance energy research and find technology-driven solutions.
The moves make excellent business sense. Gartner recently reported that regulations, costs and global warming were driving European IT leaders to "green" data centres. In October last year Gartner analysts in Europe called on IT organizations to curb computing's insatiable appetite for energy. Organizations are under mounting pressure to develop greener approaches towards their IT practices, and IT and business leaders need to wake up to the issues of escalating energy consumption and environmental legislation, the research company says.
"IT's age of innocence is nearing an end," says Steve Prentice, distinguished analyst and chief of research at Gartner. "Technology's clean and friendly 'weightless economy' image is being challenged by its growing environmental footprint. While a growing number of regulations are already increasing the end-of-life costs for IT equipment, IT also has to face mounting concerns over spiralling electrical power consumption."
Page Break
The telecommunications industry's age of innocence is also drawing to a close.
"The telecommunications industry has largely considered itself a good citizen when it comes to the environment and, in comparison to many others, it is," Ovum's Campbell says. "But it cannot rest on its laurels and it does have a few potential issues on its hands. They are related both to the environment and social responsibility."
These issues include emissions from mobile phones, the vast amount of paper used in the printing of telephone directories and the mining and use of coltan (columbite-tantalite) ore for use in mobile phones and IT equipment, a chemical that becomes toxic waste when discarded. Campbell says coltan has become the "blood diamond" of the IT industry, with the mining of coltan in the Congo funding and prolonging a civil war in the east of the country. It has spawned a global movement under the banner: No blood on my cell phone! "The telecommunications industry must respond with comprehensive recycling programs and environmentally credible processes for reclaiming valuable and toxic components," Campbell says.
The list of companies pushing to improve their environmental credentials is astonishing, whether motivated by a sincere determination to clean up their act or fear that doing nothing will invite environmental activists and concerned citizens to come after them with the proverbial baseball bat.
And that fear can prove perfectly realistic — just ask Apple. After enduring a year of pressure from members of environmental activist group Computer Take Back Campaign, Apple in April announced a scheme to take back and dispose of discarded Apple products containing toxins such as lead and mercury for Apple customers. Apple CEO Steve Jobs had previously dismissed the group's concerns, telling shareholders they were "bull . . . " during a financial call in April 2005.
However, as if to embody the old saying: "Give them an inch and they'll take a mile", the activists are refusing to rest on their laurels. Now they are demanding Apple not only set some public goals for how much equipment it will take back but also stop lobbying against producer responsibility legislation. "When the millions of Apple's obsolete computers and other electronic products hit the landfills and incinerators, millions of pounds of toxic lead and other highly toxic materials will be dumped into our air, land and water," the activists claim.
Other companies have also learned the very high cost a failure to factor environmental concerns into decision making can have. For instance in 2001 the Dutch government seized 1.3 million Sony PlayStations at the start of the Christmas spending spree because they contained illegal levels of the toxic metal cadmium. It cost Sony more than $130 million to replace all cables manufactured by an obscure supplier, and some of its good reputation.
ActewAGL CIO and general manager commercial development responsible for renewable energy generation Carsten Larsen says CIOs of all stripes should be aiming to eventually achieve a carbon-neutral computing platform. He says that although this may not be achievable in the short term, while organizations insist on buying coal-fired electricity because it is cheaper, it can and should be a long-term aim. ActewAGL is buying green electricity, which is at least a start, but has achieved greater dividends by being an early adopter of LCD screen technology, which requires lower power, and by running the aforementioned thin-client technology and encouraging staff to turn off their computers before leaving for the day.
Page Break
Doing the Right Thing
Dow Chemical Company CIO Dave Kepler is not only responsible for Dow's Shared Services and Information Technology departments, but is also very involved in Dow's 2015 Sustainability Goals. Kepler told US CIO magazine recently of his belief that sustainability is about the world and Dow's contribution to some of its challenges. Ten years ago the company set environmental and safety goals around things like injury and illness, process safety and chemical emissions, he said, and progress to data has been significant. "One of our goals was to reduce our energy consumption by 20 percent, and we reduced it by 22 percent. We also achieved an 84 percent reduction in emissions.
"We expanded beyond those initial goals recently with Dow's 2015 Sustainability Goals. We intend to improve our environmental health and safety performance by 75 percent within the next eight years. IT touches on almost every one of our goals. For example, IT is charged with creating databases to track environmental activity — measuring our emissions, tracking the safety and performance of our carriers, and managing our contractors. IT not only manages the information but it serves as a watchdog."
Dow has such stringent process control automation at its plants that they will shut a plant down automatically if it is not compliant with air and water emissions requirements. IT also helps provide safety assessments for all of Dow's products. Ultimately the company plans to provide stakeholders with key information related to the safety and risk of every chemical from Dow, via an integrated database that tracks consumption, usage and loss of a given base material.
And in the US, after Fairmont Hotels & Resorts' move to power all its check-in computers with wind power proved so successful last year, it is now expanding the initiative to include all computers in its corporate office. The organization claims last year's purchase of Eco-Logo certified wind power for 249 check-in computers will result in a greenhouse gas reduction of almost 100 tonnes over the next year.
The first step to reducing your environmental footprint is to measure it. The Global Reporting Initiative (GRI) aims to make reporting on economic, environmental and social performance — sustainability reporting — by all organizations as routine and straightforward as financial reporting.
Page Break
To achieve this, the GRI continually improves and builds capacity around the use of the GRI's Sustainability Reporting Framework, currently the de facto global standard in sustainability reporting and built on the Sustainability Reporting Guidelines. According to Wikipedia, almost 1000 organizations from more than 60 countries disclose their sustainability performance with reference to the GRI guidelines.
An AMR Research survey reported earlier this year that within the next two years 89 percent of companies in the US and 62 percent in Europe plan to use technology to manage their corporate social responsibility (CSR) initiatives. It also found that while environmental issues are of prime importance in Europe, US firms seem to be ahead in the integration of CSR-related data systems. Currently, 47 percent of European companies either gain no CSR-related data from IT systems or have numerous disconnected systems, compared to just 19 percent in the same position in the US. Nearly half of US companies (49 percent) claim to have some or fully integrated systems to provide information on CSR topics.
"What CIOs should expect from their business application providers are really the tools to bring together the fragmented programs that they're trying to manage today into an integrated dashboard that would allow the CIO and decision makers across the company to better manage their CSR and green business practice in a more integrated manner," Lawson Software's Frank says.
Alan Perkins, former CIO of Australian company Altium, says CIOs should aspire to as close to perfect information as possible. "The more unity, timeliness, accuracy and relevance in the information captured and provided to decision makers and users, the greater the efficiencies," Perkins says. "This will result in focusing attention on contributing to society and profit-making. Get the efficiencies right and you will be able to focus on doing the right things.
"For example, GE has come up with a new device called the eco-dashboard that is designed to let home owners know how much energy and water they are using and how trends track over time. Since the unit also doubles as their thermostat and central port for all their home systems (like security, and so on), it can help people learn how to conserve and how much they are conserving. Taking this logic to the workplace can be the start of changing behaviour."
Sidebar: Clean Up Your Act
Start taking action today
Jeff Neyland, CIO of Intechra, a $US100 million information technology asset disposition company, recommends other CIOs adopt some of the steps he and his organization have taken to help clean up their organization's environmental act.
- Set specific internal recycling goals and objectives and measure them annually with reduced levels targeted each year.
- Buy energy-efficient equipment when purchasing. Seek lower power and lower heat output, which can be significant for servers and other devices.
- Purchase recycled IT equipment when possible. Reuse is among the most environmentally responsible practices available to individuals and organizations.
- Set power consumption guidelines for energy conservation using Windows power management options.
- Reduce water runoff and solid waste
generation. Build energy efficiencies in plant operations. For example, Intechra's Los Angeles facility operates recycle machinery on the third shift only — this conserves energy and is non-peak for the utility company. Intechra has also built practices that have allowed its facilities to be ISO certified for environmental management.
- S BUSHELL
Page Break
Sidebar: How to Go Green
Every effort counts
Naomi Moneypenny, vice president research, content and technology at ManyWorlds, offers these suggestions for CIOs:- Energy management, which not only ensures that all computers are on power management cycles, but encourage users to shut down their PCs at night, even at home.
- Supporting recycled plastics and materials in products such as mice and keyboards.
- The CIO should support paper recycling, even though direct responsibility for recycling bin availability may fall under the domain of the facilities manager.
- Integrating energy consumption into building design (such as the solar panels that are so popular at Google). The CIO can support these efforts with measuring data and appropriate reporting to stakeholders.
- Staging the shifts of a manager's employees so they spend less time in peak traffic (thus less air pollution). Sponsor programs for ride sharing and tech talk at the same time.
- Ensuring that suppliers globally have the same standards and environmental practices that the CIO's corporation does.
- Providing a screen saver tip or other daily tip mechanism to encourage employees to reduce energy consumption.
