Insights
11 August 2022

Why the IT industry needs to act on climate risk

Cervest

By Cervest

Why the IT industry needs to act on climate risk

Though some companies are taking positive actions, the IT industry as a whole should still have comprehensive climate change and risk strategies in place – before there are further repercussions – including potential new legislation that could force companies into paying for the damage they have done to the environment. Decarbonisation plans aside, businesses need to take immediate action to ensure resilience throughout unpredictable, severe weather events. But how?

Iggy Bassi, Founder and CEO of Cervest, recently discussed this issue in a recent Computer Weekly article about tightening up the IT supply chain: “Reducing e-waste by recycling materials already in circulation, rather than extracting raw materials for new products, is a significant step towards reducing the IT sector’s carbon emissions…Many businesses are stepping up to the challenge, putting emissions reduction – including through circularity – at the top of their sustainability agendas. But decarbonisation alone is not enough. Even if we reach net zero tomorrow, decades of historic emissions mean that further warming and extreme weather are inevitable in the coming years.”

He comments: “As The Economist recently said: “The era of predictable unpredictability is not going away.” As CIOs and IT managers know all too well, supply chain disruption has soared in recent years. From Covid-19 lockdowns in China to Brexit red tape to Russia’s invasion of Ukraine, global events and trends have created shortages of everything from raw materials to critical parts.”

Creating a more resilient supply chain

As Iggy also highlights, McKinsey points to further disruption, such as the impact that intense weather events will have on manufacturing assets – meaning extended supply chain interruptions. What does this mean at the basic level for the IT sector? In IT, there is a definite reliance on the supply of semiconductors, and extreme weather situations could prove catastrophic, with damage to core infrastructures. Preparing to be climate resilient is an urgent and critical matter, as a further McKinsey report, Could climate become the weak link in your supply chain? clearly illustrates.

The need to create a more robust supply chain is key when considering the climate crisis and climate risk. The IT industry should adapt its management, planning, development, and implementation techniques according to the current situation with climate change at the forefront in order to withstand it and reduce revenue loss. Different climate events can include both long and short-term stresses – wildfires or prolonged heat stress, for example.

Gaining insight from science-backed climate intelligence

Asset-level climate intelligence – accessible through our product, EarthScan™ – can provide granular data on long and short-term climate risk from multiple climate hazards across different climate scenarios. Acting as a single source-of-truth, it enables IT professionals and portfolio owners to access decision-useful insights on current or future climate change concerns, analyze and quickly spot weak points in management strategy and supply chains. The intelligence can then be used and shared to confidently inform future planning and targeted interventions, alleviating climate risk. With the cost of inaction growing for the IT industry, it’s time to start building resilience to climate change today.

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