Navigating the Green Frontier Innovation and Collaboration in Corporate Sustainability

The article introduces the notable surge in AI adoption and the urgent need for advanced digital tools to improve sustainability practices and commitments in businesses.

In the unfolding landscape of AI, we are witnessing a notable surge in adoption. According to a McKinsey report, AI adoption has jumped dramatically to 72% in early 2024, up from about 50% in 2023. This rapid advancement signals not only technological progress but also a critical opportunity to re-evaluate their sustainability practices and commitments.

A recent survey report commissioned by Alibaba Cloud titled “Tech-Driven Sustainability Trends and Index 2024” reveals a significant gap: while 80% of businesses across Asia, Europe, and the Middle East have established sustainability targets, more than half (53%) still rely on manual tools to track progress. This reliance can hamper efficiency and accuracy, highlighting an urgent need for advanced digital tools.

Earlier this month, industry experts gathered for a virtual panel hosted by Alibaba Cloud, titled “Navigating the Path to Corporate Sustainability with Technology in Asia”. The discussion centered on leveraging technology and fostering collaboration to enhance corporate sustainability efforts. Panelists included Dr. Matthew Dearth, Associate Professor of Finance at Nanyang Technological University (NTU); Roy Cheung, Global Head of Sustainability Solutions, Engineering Plastics at Covestro; and Wei Liu, Head of ESG Strategy at Alibaba Group.

Alibaba Cloud hosted an online panel titled “Navigating the Path to Corporate Sustainability with Technology in Asia” in November

During the discussion, Liu emphasized the vital connection between digital transformation and sustainability. “By leveraging AI and intelligent insights, organizations can identify carbon emissions across their operations and important actionable optimization solutions,” Liu remarked, highlighting that effective management begins with accurate measure.

“People often say that if you cannot measure or quantify it, you cannot manage it. You need a comprehensive understanding and substantial quantification to move from manual methods to more efficient, tech-driven solutions,” he added.

Cheung from Covestro echoed this sentiment, emphasizing the role of digital tools in monitoring emissions across Scope 1, 2, and 3. He noted, “We’ve embraced digitalization to enhance our ability to understand our status before we even set targets.” He pointed out the complexities of measuring emissions, particularly across multiple companies in the value chain, and stressed the importance of collaboration. Cheung highlighted the partnership with Alibaba Cloud, whose AI-driven sustainability solution, Energy Expert, fosters data transparency and simplifies company communication, thus facilitating more effective carbon footprint measurement.

The Role of Technology in Achieving Sustainability Goals

Despite the potential of technology, ongoing barriers to achieving sustainability goals were a focal point of the discussion. Liu noted that the reliance on manual processes limited timely decision-making and complicated data management. He cited a Malaysian asset management company that successfully utilized Energy Expert to automate its carbon emissions reporting, showcasing technology’s potential for driving meaningful changes.

The complexity of sustainability challenges requires deploying advanced digital tools that can provide accurate emissions measurement, actionable insights, and optimization strategies.

AI-powered platforms like Energy Expert are already demonstrating the potential of technology to transform sustainability efforts. These platforms automate carbon accounting and offer data-driven recommendations for reducing emissions across Scope 1, 2, and 3 categories.

According to Alibaba Cloud’s report, over 78% of businesses view technology as critical for achieving sustainability objectives, further emphasizing the imperative to adopt such platforms.

Liu echoed this sentiment, adding that “by leveraging AI and data-driven insights, we can help businesses identify carbon emissions across their operations and implement actionable optimization solutions.”

Dr. Dearth from NTU added that collaboration with educational institutions is crucial. “Understanding where relevant data resides is essential for effective emission measurement. Institutions like NTU must work with businesses to create better data management practices,” he said.

Insights from Alibaba Cloud's recent survey, Tech-Driven Sustainability Trends, and Index 2024, further illuminate the current landscape of corporate sustainability.

Conducted among 1,300 decision-makers across 13 markets in Asia, Europe, and the Middle East, the survey revealed that while 80% of businesses have established sustainability targets, a predominantly manual approach persists, with 53% still relying on outdated methods like spreadsheets to track their progress. Moreover, 78% of respondents acknowledged technology’s critical role in achieving sustainability goals, yet challenges remain, including budget constraints (29%), complex supply chains, and limited technological capabilities.

Collaboration – A Shared Responsibility to Bridge the Gaps

Notably, the report shows that 82% believe the government must play a more active role in supporting companies to adopt digital technology to drive sustainability, highlighting a demand for more robust governmental engagement in this arena.

Recognizing governments’ important role, the experts highlighted the necessity of collaboration among public sectors, businesses, and academia. Liu asserted that “this is a shared responsibility across all stakeholders. Clear regulatory frameworks and incentive mechanisms are crucial for encouraging corporate engagement in sustainability initiatives.”

Dr. Dearth underscored the importance of a balanced policy approach: “For effective change, we need both incentives and regulations. While businesses often prefer carrots, accountability measures are becoming increasingly essential,” he remarked. He also mentioned Project Greenprint in Singapore, which exemplifies how government-led initiatives can drive sustainability. The project fosters transparency and supports cross-sector partnerships by creating a “golden source” for sustainability-related information . “This initiative aims to unlock the potential of smart technologies to address pressing sustainability challenges,” he said.

At the same time, corporate-academic partnerships enable breakthroughs in green digital technology. Alibaba’s collaboration with Nanyang Technological University’s ANGEL Lab, for instance, focuses on energy-efficient AI algorithms, green cloud computing, sustainability standards and metrics, and more.

The Way Forward

As sustainability has become a global imperative, organizations must adopt collaborative strategies and technological solutions to bridge the gap between sustainability ambitions and real-world actions. Embracing advanced technologies and fostering partnerships will be essential for meeting sustainability targets.

In response to the urgent challenges posed by climate change, businesses are increasingly prioritizing sustainability within their operational strategies. Adopting advanced technology solutions, such as automated carbon tracking and AI-driven efficiency tools, has emerged as essential for reducing emissions while ensuring operational efficiency. Although significant challenges persist, especially in Southeast Asia, the growing use of AI and other technologies offers promising prospects for promoting sustainable growth across various industries.

Ultimately, the pressing question is not whether businesses should prioritize sustainability but how quickly they can implement robust solutions. As Cheung noted, “The challenges are real, but through collaboration and the adoption of new technologies, we can turn these challenges into opportunities for progress.”

Learn more about Alibaba Cloud’s sustainability solution

This article was originally published on Alizila writtern by Karen Zhang and Gabbie Fu

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Navigating the Green Frontier Innovation and Collaboration in Corporate Sustainability

The Role of Technology in Achieving Sustainability Goals

Collaboration – A Shared Responsibility to Bridge the Gaps

The Way Forward

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