Sam Darwish, Chairman and CEO, IHS Towers.
Did you know that the mobile industry became one of the first sectors in the world to commit to the UN Sustainable Development Goals in 2016, according to GSMA? These 17 goals call for significant action to reduce carbon emissions and promote developments within the renewable energy sector.
Since then, the industry has demonstrated its commitment, as data traffic increases of 31% in 2022 were met with associated electricity increases of just 5% and carbon emissions increases of 2%.
To help keep emissions at bay, in October 2022, my company, IHS Towers, announced our Carbon Reduction Roadmap with the aim to reduce the scope 1 and scope 2 kilowatt-hour (kWh) emissions intensity of our tower portfolio. Our Project Green is the next significant step in that roadmap. It focuses on how we are increasing renewable energy sources on our African sites between now and the end of 2024. Our aim is dual—to reduce our reliance on diesel and generate long-term cost savings.
Here’s what I’ve learned from doing this work so far.
1. Start by setting a target.
If companies are to deliver on their commitments to reduce emissions, they must embrace renewable energy and the sector’s technological developments, and do so with a target in mind. That’s why we set ourselves the aim of reducing emissions by approximately 50% by 2030, and in the immediate term are integrating solar panel and battery storage solutions at off-grid locations, and where possible, connecting to the grid.
Setting targets is a powerful way of holding a business to account. It helps ensure they act on climate change and demonstrate their commitment to implementing strategies that mitigate its effects. That said, while having a target sends a strong, motivating message, it exposes your business to more scrutiny.
So before setting a target, every business leader should ask themselves why? Why are you creating another standard, a benchmark that holds you to account?
Firstly, there are the obvious stakeholder considerations—investors, customers, government programs and even employees. Secondly, carbon reduction can offer long-term capital expenditure savings and new growth opportunities.
Once you have determined that setting a target is the right course of action, you need to refine it against the macro setting. What are the national laws and global requirements applicable to your business? What are your peers doing and how do you benchmark?
My advice is to first consider the why, second the what and third the how. How are you going to set a target that meets your business needs and delivers progress? For the latter, third-party support is essential.
2. Lean on the experts.
Regardless of the sector you operate in, setting an emissions reduction target is always going to be complex. It’s likely going to take longer than anticipated, be more data intensive than expected and require the support of external specialists.
For example, on our emissions journey, we engaged an external environmental consultant to determine the specific level of carbon emissions reduction that was feasible for our business, and the markets in which we operate. We operate in a fast-moving, high-growth sector, and because of our organic growth, this third party helped us determine that an intensity-based target was more appropriate than an absolute emissions target.
Targets need to be realistic. They must both consider business growth and demonstrate a real commitment to carbon reduction.
Working with a climate consultant or other specialist is key; they provide the critical skills to help you navigate the balance between ambition and delivery.
3. Don’t underestimate the importance of internal stakeholders.
In setting our own target, the task’s enormity became quickly clear. Obtaining accurate data is essential. It’s a huge undertaking for any business, particularly large companies that operate across many markets, like mine. It also depends on the data available, e.g., GHG emissions, its quality, and having the right resources. Central to this is buy-in from your leadership team.
Your leadership team needs to be engaged from the get-go—the point at which you start quantifying emissions. Work with your external partner to help educate your leadership team on climate change, the risks and opportunities and principles of effective carbon management. Help them recognize both the environmental and business benefits and champion it as a pillar of your business and culture.
Achieving carbon reduction will require ongoing investment and so their support is critical. Reducing your carbon footprint is a journey that all leaders need to be carried along on. So, in addition to gaining their initial buy-in, communicating progress (however incremental) is vital.
At my company, we are communicating that progress to internal and external stakeholders; for example, we report on things like solar power solutions, generator run-times and decarbonizing our footprint. Yet simultaneously, we have been transparent in the capital expenditure required to hit our goals. By gaining support from our leadership team at the start of our carbon reduction journey, and communicating our progress so far, that additional capex becomes a recognized essential.
In terms of our financials, we expect significant annual savings by 2025 as a direct result of capex deployed. So, while setting this target was a complex, operationally intensive task, the benefits are clear.
4. Remember, climate action enables innovation.
With the roll out of artificial intelligence, virtual reality, IoT and blockchain, there is likely to be more seamless connectivity and the emergence of new business models that transform multiple sectors. By operating responsibly and fostering collaboration, businesses can help shape a more sustainably connected and prosperous future for all.
Reducing our environmental footprints, through a comprehensive carbon reduction strategy, is central to innovation.
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