Telecommunications
Sustainability in Telecommunications
Sustainability is a strategic topic with substantial potential returns in terms of savings and new product offerings for the telecommunications industry. The unprecedented demand for digital communications during the pandemic has forced telco infrastructures to consume more energy than ever, expanding their carbon footprint. This demand likely will continue or increase as companies adopt remote and hybrid work models and make these tools a permanent part of the workplace.
Value drivers for Telecommunications
Energy Efficiency
The energy dimension measures scope 1, 2, and 3 emissions in terms of energy intensity, e.g., comparing emission totals to IP data traffic (gigajoule/exabyte). The telco industry has a significant opportunity to reduce its energy intensity by upgrading to 5G.
Carbon intensity
Carbon intensity is a ratio that expresses the impact of GHG emissions per unit of economic value (e.g., metric tons of CO2e per unit of total revenues, using the registrant’s reporting currency) or per unit of production (e.g., metric tons of CO2e per product produced). The “unit of production” for the Telecommunication industry is network traffic, per the Sustainability Accounting Standards Board (SASB’s) Telecommunications industry Activity Metrics.
Circularity
Besides carbon emissions, waste is the second major factor contributing to any telco’s environmental footprint. This dimension measures direct waste and the amount of waste recycled as a percentage of total waste. The other component is consumer behavior, measured by mobile phone collection for refurbishment and recycling relative to group (mobile) revenue.
Network Traffic
Network traffic is the amount of data that moves across a network during any given time. For every search we do, online order we make, and video call we join, there is an environmental impact from the data centers, servers, and other physical infrastructure that the internet relies on to run. The SASB classifies Network traffic in petabytes as an Activity Metric. The focus of this metric is on data usage (i.e., traffic on telecommunication networks) rather than capacity or bandwidth.
Network Traffic (Petabytes) = Network Traffic (terabytes) X Conversion Factor
Disclosure standards for Telecommunications
The SICS (Sustainability Industry Classification System) lookup tool from SASB (Sustainability Accounting Standards Board) allows you to determine the primary SICS industry for tens of thousands of companies listed around the world, enabling investors and corporations to determine which SASB Standard is applicable to that company. The Telecommunication industry falls under the service sector, and you can download telco standards from the SASB website free of cost.
