Sustainability is emerging as a top value indicator for investors and a key determinant for consumers, with companies looking for new ways to measure and demonstrate their sustainable contributions. Artificial intelligence can help companies produce these reports for multiple audiences. This is the conclusion of a discussion led by Dr. Priyanka Srivastava, a researcher and award-winning professor at Hult International Business School.
One of the key challenges companies face is how to measure sustainability when there are multiple subjective interpretations of what matters. Frameworks such as Environmental and Social Governance (ESG) and Sustainable Development Goals (SDGs) encourage business stakeholders, investors and government authorities to measure and evaluate corporate sustainability metrics and quantify their commitments. are actively debated. In today’s competitive landscape, an organization’s growth and success can depend on decisions about socio-economic and environmental considerations. Corporate Social Responsibility (CSR), often defined as ‘don’t do bad’, has turned into an obligation to ‘do good’ and boils down to ESG and SDG strategic priorities. .
The Importance of Sustainability Reports
Popular rating agencies such as S&P Global produce sustainability indices for individual companies. This measure draws investors’ attention to benchmarking long-term impact and returns from the business. Organizations are harnessing the power of cloud-based strategies to make corporate sustainability data readily available as part of open data initiatives by cloud service providers (AWS, GCP, Azure). Sustainability Accounting Standards Board (SASB), Global Reporting Initiative (GRI), Carbon Disclosure Project (CDP), Task Force on Climate-related Financial Disclosures (TCFD) and others have established standards to reach 90% is one of the groups that of S&P 500 Index companies publish sustainability reports and make them readily available. By 2022, 95% of S&P 500 index companies will publish a sustainability report, up from just 20% in 2011.
AI that creates sustainable behavior
AI will enhance both sustainable business practices and reporting on the impact of these initiatives. For example, AI has the potential to help build resource-efficient smart cities and circular economies. AI can also assist in the development of renewable power by enabling smart networks that partially match energy consumption during periods of sunshine and wind. AI proactively drives environmental outcomes through its ability to analyze large, interconnected databases to develop coordinated actions aimed at conserving the environment. Previous research provides evidence that breakthroughs in AI can help us better understand climate change and model its potential impacts. In addition, AI will help develop low-carbon energy systems that incorporate a high percentage of renewable energy and energy efficiency. All of these are needed to combat climate change and improve ecosystem health.
But as we’ve seen over the past two decades, while digital breakthroughs have brought us daily benefits, there are also many tough questions and broader concerns about how technology will affect society. causing it. We have seen this as the Internet matures and becomes an integral part of our work and personal lives, and as AI advances and the world changes, this seems to be the case. The links identified between AI and sustainable goals are largely positive, but trade-offs must be considered. Advanced AI technology, research, and commercial development can require vast amounts of computational resources available only in large computer centers. These facilities have high energy demands and a high carbon footprint. AI technology, which relies heavily on data analytics insights and resources not equally available in low and middle income countries, has the potential to widen economic inequality and create new inequalities, while at the same time accelerating economic growth, modernization. , which can impact long-term infrastructure goals. Inequality is also reduced.
Looking back over the past 200 years, a series of industrial revolutions have dramatically improved human living conditions. But each previous industrial revolution has borrowed from the future to pay for the present by achieving economic expansion at the expense of the planet’s health. Today’s technological revolution must break this trend and create sustained economic development. Thinking strategically about the enormous potential of AI to drive economic prosperity and a more sustainable future is a joint responsibility of businesses, governments and individuals.
The first step in this important quest is the introduction of AI tools to measure and report on the environmental and social impacts of modern business activities. AI also helps cross-check and validate these reports, ensuring they are accurate, transparent, and readily available. Measurement is the first step to action. And with the advancement and pervasiveness of artificial intelligence, this measurement has become much easier and more accessible.
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