From the 'C-Suite' to 'Gen-Z' - why ESG needs to drive the new digital agenda
Lucia Reisch of the University of Cambridge Judge Business School calls for a ‘digital re-set’.
From the ‘C-suite’ to ‘Gen Z’, terminology surrounding relentless change in the world of commerce has a common reductive default – it paradoxically shrinks what are seismic shifts in the corporate psyche to the most diminutive of terms and acronyms.
Too often we hide behind ubiquitous and benign terms for an irresistible march toward dynamic digital development. From the unquestioned mushrooming of everyday AI applications to the eco-challenges of power-thirsty data centres euphemistically referred to as ‘the cloud’ – what’s threatening about a fluffy cloud, after all? – are the custodians of the 4th industrial revolution simply sleep walking towards making the same mistakes our forefathers made with the first in terms of the potential for growing inequalities, social division and resource depletion created?
Although itself an unhelpful acronym ESG (Environmental Social and Governance), a focus of many c-suite executives, refers to the non-financial factors that drive corporate and investment decision making which is increasingly looking towards policies that represent a ‘common good’ rather than the pure pursuit of profit.
In a 100-page report that I co-authored with D4S (Digitalisation for Science) – Digital Re-set redirecting technologies for deep sustainability transformation – we looked at how the digital economy should be de-centralised away from a handful of big IT players and integrated to produce change for the good of the wider society and the planet.
In the report we argue that governing the ‘megatrend of digitalisation’ must step up to today’s societal challenges and that runaway climate change, bio-diversity loss, increased social polarisation and the erosion of democracy require swift and decisive action.
“The state of scientific knowledge demonstrates that digitalisation in its current form does not deliver solutions and that incremental changes are insufficient to remedy this situation,” we write in the executive summary.
“What is needed therefore is a digital re-set: a fundamental re-direction of the purpose of digital technologies towards a deep sustainable transformation. To this end, governance should follow set principles: Technologies should be built according to regenerative designs and pursue systems innovation that advance circularity and sufficiency, improve economic resilience, and foster digital sovereignty and social equity.”
The report details how the principles can guide the use of digital technologies for deep, sustainable and fundamental changes across multiple sectors including agriculture, mobility, industry, energy and construction.
One of the areas for transformational change is the social and environmental impact of producing and operating digital devices, infrastructures and data centres, the real identity of what is commonly described as ‘the cloud’ storage in which, according to many recent sources, produce more greenhouse gas than a small country.
The report looks at the non-sustainability of the time-tabled plans of a number of the big tech companies to reduce their carbon footprints, strategies that the report argues show ‘insufficient climate ambition’ to holding dangerous global warming levels to sub 1.5 degrees centigrade.
It presents instead a combined strategy and calls for the control and ultimate replacement of big tech companies as the custodians of digitalisation so that its development is for the common good rather than commercial need of a technological elite.
It concludes by arguing for greater governance of data and AI as part of the ‘digital re-set.’
“A successful redirection of digitalisation requires decisive policy action and a clear vision of the role of digital technology for the realisation of decent lives for all people within planetary boundaries,” it says.
In short, it will be the executives of today and tomorrow who will have to shape the environmental, social and governance strategies that harness rather than hinder digital development so that it promotes the equality of opportunity presented by digitalisation. This is a reclaiming of the wider societal potential of the latest industrial revolution, an opportunity that was lost in the concentrated heat of the smelting forges and fogs of the first.
This article and it’s views have been written by Lucia Reisch of the University of Cambridge Judge Business School.