Meet Five Tech Companies Racing To Lead On Climate Action
Why It Matters
Millions are marching around the world to demand action from leaders on climate change. Notably, employees from technology companies are striking. Now, these companies are racing to lead the way by making ambitious sustainability pledges, which could drive transformative change.
“How dare you!”
The burning words of Greta Thunberg, a 16-year-old climate activist, spoke directly to world leaders last week, condemning their inaction for leaving her and children around the world with the burden of climate change.
Companies, and tech companies in particular, are also feeling pressure to act on climate change. Technology companies have been under increased scrutiny in the last few years, as a combination of regulatory concerns around competition and privacy, the influence and power of their platforms, as well as their struggles with diversity have made headlines. On climate, it’s no different – people expect these companies, with their ambitious rhetoric about their products, to lead on social and environmental issues too.
Millions around the world marched in September’s climate strike, with nearly 700,000 in Canada, powerfully showing the public’s concern about the issue. Tech employees joined the protests in what’s been described as “an awakening.”
Tech companies including Amazon, Google, Microsoft, Salesforce, and Shopify recently made significant climate announcements. Here’s why these pledges matter, and what to watch for next.
Amazon
The Pledge
Amazon made several significant pledges and co-founded The Climate Pledge. As part of this pledge, the company committed to:
- Powering its global infrastructure using 100% renewable energy by 2030 on a path to net zero carbon by 2040
- Ordering 100,000 fully-electric delivery vehicles, the largest order ever for electric delivery vehicles
- Investing $100 million in reforestation projects around the world to remove carbon from the atmosphere
Why it Matters
Amazon’s announcement seems to have made the biggest waves in the press, likely because of the sheer size of the company and the nature of its immense logistics business. Amazon has shipped over five billion items per year through its Prime program alone. All of those items come with environmental costs through their packaging and shipping.
Also, until recently, Amazon’s founder Jeff Bezos had not given nearly as much to environmental causes as his peers. So this pledge has been a long time coming; now, the majority of top tech companies – and their leaders – invest significantly in the environment.
What to Watch
Amazon has also launched Sustainability Amazon, a new sustainability website to report progress on commitments. It will be important to watch whether Amazon does what it says it will.
Notably, Amazon made its fortune before making significant environmental commitments. Watch to see if other e-commerce leaders, including even larger companies in China and India, make the same mistake.
The Pledge
Google recently made its biggest-ever renewable energy purchase, which is also the largest corporate purchase of renewable energy to date. It’s a 1,600-megawatt package of agreements that includes 18 new energy deals. Google states that they’ve recently become the “largest corporate buyer of renewable energy” in the world.
Why It Matters
According to Google, their latest agreements “will spur the construction of more than $2 billion in new energy infrastructure, including millions of solar panels and hundreds of wind turbines spread across three continents.”
What To Watch
Watch if other tech companies follow and match the scale of Google’s energy purchases. Google’s actions may pave the way and bring the price of the whole market down.
Wind energy still makes up the majority of energy Google purchases. But also, solar energy has come down dramatically in cost and is increasingly comprising a larger percentage of the mix. It would not be surprising if other companies follow Google and purchase more solar over wind.
It will also be interesting to see if Google will choose to go beyond renewable energy purchasing to also invest in environmental cleanup and restoration efforts beyond carbon offsets, such as reforestation or carbon sequestration.
Microsoft
The Pledge
Microsoft focuses on reducing carbon in their supply chain and their products. Their business operations have been carbon neutral since 2012, and their goal is to make their products carbon neutral, too, beginning with more than 800,000 Xbox consoles.
They have also given technology and grants to over 400 organizations including environmental groups in more than 70 countries, and have pledged to cut emissions in their supply chain by at least 30% by 2030.
Why It Matters
Microsoft’s efforts to reduce carbon use in their supply chain and products are remarkable considering their scale, and will save an immense amount of carbon. They are also spurring competitors like Sony to step up their commitments.
Microsoft is also pioneering the use of AI for sustainability with their AI for Earth program, which empowers hundreds of environmental projects to increase sustainable fishing, improve forest management, and improve conservation efforts.
What to Watch
Watch if Microsoft’s pilot for its Xboxes expands to the rest of its products, such as its Surface line, and if the company meets its supply chain emission reductions targets.
Salesforce
The Pledge
Salesforce’s recent announcement focused on using its own software to launch a carbon accounting product. The Salesforce Sustainability Cloud will enable businesses to quickly track, analyze, and report reliable environmental data.
It’s also committed to offer a carbon-neutral cloud, being 100% renewable energy powered by 2022, and they’ve made a host of other commitments.
Why It Matters
Salesforce believes that business is the greatest platform for change. Their goal is to allow business to take a data-driven approach, supplying them with “investor-grade data” on their climate efforts. That will allow business to be a serious force for climate change and provide data to hold them publicly accountable.
What to Watch
Salesforce’s announcement seems great, but the challenge of every enterprise technology product is adoption. Will this really take off? And do companies actually want to share this environmental data publicly? But perhaps it can validate sustainability efforts – if a company isn’t willing to share their metrics on the Sustainability Cloud, it’s possible they will lose credibility.
Shopify
The Pledge
Shopify’s pledge focuses on carbon sequestration, which removes carbon from the atmosphere. The company has announced that it will invest $5 million annually in the Shopify Sustainability Fund, and the fund includes commitments to:
- Buy $1 million of sequestered carbon annually
- Carbon-neutral operations and platform
- Sustainable shipping and opportunities for both merchants and buyers to achieve carbon neutrality
Why It Matters
Shopify is smaller than other tech giants but it has made an impressive commitment. Today, it seems that a minimum standard for major technology companies is to be powered by renewable energy, and eventually become carbon neutral. Shopify is going a step further by actively removing carbon from the atmosphere.
What to Watch For
Shopify recognizes the importance of carbon sequestration, but also the high cost of these activities. Their bet is that the technology will become cheaper if more companies invest in it. But if the cost never comes down, carbon sequestration may ultimately not be effective.
What’s next?
Will these announcements be enough to accelerate climate action? It remains to be seen.
As tech companies blaze the trail in making their practices sustainable, watch whether these announcements influence traditional companies. If tech leads the way and others follow, companies will become a truly transformative force for good in fighting climate change.
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