It may be interesting to note that 240 kg of fossil fuel is used to produce one PC, which releases 700 kg of CO2 and that 50% of all hardware related costs are actually energy costs. Further, 2% of the world’s total CO2 emissions originate from the IT industry. However, if ICT is deployed efficiently and innovatively, it can have a much more profound effect in the reduction of the remaining 98% of emissions.
Environmental responsibility is emerging as an important consideration for corporate organizations and technology suppliers. Ironically though, we often find that businesses are rooted in delivering short-term benefits, without realizing that this may contribute to their own downfall – by increasing the rate at which customers begin to value a longer-term sustainable approach. Being accountable and responding timely to social pressures is therefore an important strategy tool to ensure business long-term viability. These organizations must use fewer resources more efficiently, to produce goods and services that benefit society and environment and still meet traditional demands.
The imperative for environmentally sustainable production and consumption builds on the principle of reduce, reuse & recycle. But it requires much more than that – in terms of innovative thinking and fundamental alterations in business models. It requires making the most of fast-changing regulations, leading-edge technologies and shifting consumer expectations and demands. Above all, this new imperative requires that sustainability be woven into the core strategies of companies and public sector organizations. Corporate IT will go totally green in the coming years, driven by a combination of cost efficiency, regulatory compliance, and corporate responsibility motivations. Some more immediate and obvious ways in which ICT can be leveraged are de-materialization and online delivery, as well as solutions and processes that result in reduced need for commute and transportation.
Green ICT can have a three-pronged effect:
- Optimization effect, by increasing efficiency (e.g.: reducing paperwork in MFI operations)
- Substitution effect, by re-engineering workflows to result in a reduced carbon footprint (e.g.: using GPRS for planning a loan officer’s routing, thereby reducing time and fuel wastage)
- Induction effect, by creating incremental demand, and possibly “increasing” the footprint in the process (e.g.: differentiated service and pricing leads to more collective travel)
The idea should be to not only offset the impact of increased footprint due to induction effects by the savings realized by optimization and substitution of process flows, but to go further and have an overall positive impact on carbon reduction levels.
Having said that, clean technology innovations will be successful only when embedded within broader transformed socio-economic paradigms, and technological change in itself will be a gradual. Clean technology implementation can however immensely help in addressing problems related to sustainable development and will further augment the social impact of microfinance. However, it bears reiteration that sustainable development is a social phenomenon with technological innovation being just one of the many enablers required for a transition to sustainability. Technology in itself is not a panacea for all problems, but it can most definitely offer successful and sustained solutions when applied in a contextual framework that comprises transformed mindsets, thereby encouraging active & collaborative participation from various stakeholders, and is supported by innovative funding models that have a broader mandate for strengthening social, economic and ecological capacities.
As the microfinance industry moves from being philanthropic to also being one of the most viable poverty alleviation approaches available in the developmental toolkit, it will also have to worry about environmental sustainability –in terms of not only how it manages its operations to also about how green is its footprint! On a more pragmatic level, MFIs that get greener - be it through reducing the carbon footprint of their business operations & technology deployments, or by financing greener micro-enterprises, will benefit not only through the environmentally sustainability imperative but also by making a positive impression on the minds of socially responsible investors.
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