Organizations have grown more productive by embracing the scalability and performance of cloud computing. As they’ve become more sensitive to matters of sustainability, however, organizations will place greater focus on the sustainability of cloud computing models from an overall environmental, social and governance (ESG) standpoint. This is true globally, whether ESG goals are driven by regulations, stakeholder demands or corporate values.
Cloud computing is more carbon-friendly than traditional data centers, primarily through the cloud shared datacenters and resources across a large number of customers, and the advanced cloud services which are ready to use, saving organizations significant development, compute time and storage involved in building their own services.
With emerging regulations and many organizations now pursuing an eco-friendlier future, leaders will want to refresh their approach to cloud computing to incorporate sustainability into their engineering, architecture, and operational processes. Organizations that are already implementing ESG across their business are at a competitive advantage over those which will need to react once regulation and market influence force it upon them.
Larger organizations including several technology giants have committed to carbon-neutral futures. Nearly all the S&P 500 companies are already voluntarily reporting ESG data. In the United States, the Securities and Exchange Commission is expected to soon require its registrants to reduce and report on their emissions. The vast majority (93%) of Standard & Poor’s companies already disclose their ESG positions voluntarily. In the EU, a new sustainability reporting directive, following the European Sustainability Reporting Standards (ESRS) has recently come into force (5 Jan 2023), requiring approximately 50,000 companies to report on their sustainability. Nevertheless, many organizations worldwide will continue to align to ESG goals with their core business values and develop a framework to attain those goals.
The major cloud service providers (CSPs) currently provide limited sustainability metrics (however are making progress against sustainability goals themselves). Regulatory and customer ESG demand will drive the CSPs in providing more granular sustainability metrics such as carbon emissions per minute (per service/region) and enable organizations in making architectural, engineering and operational decisions based on their sustainability objectives.
As FinOps tools help businesses optimize and manage cloud costs today, their tools will expand to help reduce carbon footprints – powered by carbon emissions data from CSPs. The result would embody sustainable architecture: sustainable cloud usage that considers performance, cost and energy source.
Leveraging granular CSP sustainability metrics and advanced FinOps tools will provide organizations with the insight to reduce emissions. However, efforts to develop metrics and make progress against them will only be possible when CSPs deliver detailed data about their emissions.
Sustainable cloud best practices
Despite the lack of granular cloud sustainability data and metrics organizations are able to pursue interventions today to reduce their cloud carbon footprint:
- Turning off resources when they aren’t needed. Production may run 24/7, but developers don’t work around the clock: shut down development environments overnight
- Deleting data that isn’t needed
- Select the compute instance type that best suits the application requirements for efficiency
- Monitoring resource usage to fine-tune consumption over time
- Automating deployments to the cloud and elastically scaling resources
- Leveraging cloud-native platform as a service (PaaS) and software as a service (SaaS) over Infrastructure as a service (IaaS) based architectures
- Moving to more efficient and newer compute instance types and processors
- Modernizing legacy IaaS-based applications and architectures to cloud-native PaaS and SaaS
- Continue to transform and move applications to the cloud which were previously left in the “too hard basket” in previous cloud migrations
- Pairing cloud’s advantages with green coding practices in homegrown software. These applications prioritize sustainability equally with performance, security, cost and accessibility
- Establishing key metrics related to IT carbon consumption. These won’t just establish a foundation for reporting; they’ll motivate further action. Evolve metrics – and develop new ones – as efforts progress. ESG reporting has delivered business benefits like customer retention, recruitment, cost savings and reduced long-term risk
Drive cultural change toward sustainability
People at all levels of an organization get it: cybersecurity is everyone’s responsibility. Leaders have changed corporate culture in recent years by building cybersecurity awareness. They can do it again, this time building awareness and cultural change about sustainability.
By socializing sustainability for IT, stakeholders learn to consider how high-volume processing and other system tasks are scheduled and to seek expert advice for sustainable information systems use. System users begin to consider sustainable architecture benefits and understand factors that determine which cloud services meet sustainability goals. To achieve this awareness, leaders can build sustainable architecture literacy into general ESG training programs.
Organizations have linked governance from board to back office as part of their ESG journeys. Whether they report progress to prepare for eventual regulation or to align with corporate values, leaders can ensure staff understands their individual roles in reducing carbon emissions. Bottom-up metrics that find their way to the board — and out to the public — help identify opportunities function-by-function to optimize carbon footprints continuously.
Wherever an organization finds itself on its ESG journey, it can advance. While the cloud is more sustainable than traditional data centers, it is becoming increasingly important for organizations to implement sustainable practices to stay ahead of their competitors and emerging regulations.
Protiviti can help organizations establish all-new ESG strategies and frameworks, implement sustainable cloud practices and drive organization-wide cultural change to drive down emissions.