Digital transformation is key to unlocking sustainable recovery

The world is at a crossroads with the weight of the climate crisis on our collective shoulders as we seek a better path forward. One of those paths forward is through technology, which we believe can play a pivotal role in addressing this crisis, through delivering an improved, sustainable, and future-proof global economy.

2020 brought a pause and presented an opportunity to think differently and change course.  We now have the chance to build a better future – one with a foundation of sustainability that puts technology to work for social and societal good.

Five years ago, the world took a stand against climate change. In a historic landmark agreement signed in Paris adopted by 196 nations, we agreed to undertake a common cause to combat the global temperature rise and help increase resiliency against the impacts of climate change. To reach those goals the agreement provided a technological framework to enhance capacity and encourage each other to build clean, climate-resilient futures. For most at the time, it was hard to conceive that a global pandemic would completely upend our economies and send shockwaves throughout every aspect of our lives – but behind the scenes, the threat of pandemics had been growing, as human development infringed on the environment. Now is the time to refocus and think differently about sustainability.

As we look to the future, we know the global population is set to grow to a total of 8.5 billion by 2030. By that time, 3 billion more people will have additional purchasing power, increasing demand for products and services, placing enormous pressure on the earth’s natural systems. Global demand is only going to grow, and industries and governments must collaborate to generate supply in an environmentally sustainable way. To do this, stakeholders across the public, private, and non-profit sectors must embrace sustainability and the concept of a circular economy.

Since the beginning of the pandemic we’ve gained a better understanding of the world’s largest issues and how to progress towards resilience. Digital adoption proved to be key to our survival and the sustainability of some of our most vital sectors. These changes are not going away with COVID-19 either. A report from AlphaBeta and Microsoft Research reveals that nearly nine in 10 Australian firms adopted new technologies to improve their business continuity during COVID; with 45% of businesses saying technology tools were essential or very important to continued operations.[1] Both the private and the public sectors are working to ensure that this increase in technology adoption remains in place to not only guarantee maximum flexibility, but also as an investment for future generations. Renewables, material recovery, re-manufacturing, and recycling can address some of today’s most critical problems, with digital technologies well positioned to provide the infrastructure for all these vital processes.[2]

Through advanced video calls and instant communications, digitalisation can help cut emissions by decreasing the need for travel, with transport accounting for 21% of global emissions, and 73% coming from short journeys. The emergence of new technologies is now converging and will ensure the transport sector evolves, and undergoes its most dramatic, and sustainably focused transformation in a century. At a macro level, digital technologies could already help reduce global carbon emissions by up to 15% – or one-third of the 50% reduction required by 2030 – through solutions in energy, agriculture and land use, buildings, and services.[3]

Beyond new technologies, public and private sectors can advance a circular economic recovery by ensuring we are bringing out-of-use technology back into the supply chain. In offices all over the world, technology is being updated, leaving predecessors sitting unused. If that technology is still viable, it’s important it is put to use – and if it has reached the end of its lifespan, it is critical that the materials are recycled and put back into the supply chain to make new products. Through an approach which places circularity at the heart of industry, the world can benefit by $4.5 trillion in economic benefits by 2030, however, realising this potential will require unprecedented collaboration given that today, only 8.6% of the world is circular.[4]

With COP26 fast approaching, we have a chance to not only set new ambitions around net zero targets, but also to reframe the conversation within our current predicament. As the world enters recovery mode, we can retool our digital strategies to really make a difference and ensure we rebuild with sustainability at the heart of our efforts. Global governments have a central role to play in this, as smarter, sustainable progress requires innovative leadership at its core. This takes bold vision and an international digital strategy that will help translate the vision into reality – one that completely rethinks the way we develop and apply technologies.

There is a lot the public sector can do to support. For one, policy makers have an obligation towards citizens to advance long-term sustainable ecosystems by enabling policies and services that are sustainability aligned, such as driving towards more paperless operations to reduce waste and water usage. But we can go beyond that, for example, by consolidating data centres and IT infrastructure used for departmental applications to reduce the impact on power requirements.

The private sector shouldn’t be overlooked in this vision. Its role as a major driver of growth and job creation make it an invaluable asset in a sustainable future, however, the challenges of the current economic model are huge and only growing. Governments can help set industry on a better course, addressing mounting resource use while fostering sustainability and innovation.

Digital transformation, focused on automation and big data, will have a role to play here. Advanced AI applications will help nudge us closer to circular business models with optimised inventory management and workflows. We’ll also finally be able to close the loop on products and materials by using AI to improve the reverse logistics infrastructure required to dissemble and recycle products.[5]  Australia is already a leading figure in AI adoption, with the government recently committing a total of $124.2 million towards AI capabilities over the next four years through creating a National AI Centre and AI and Digital Capability Centres.[6]

Reducing waste and emissions related to the manufacturing and use of products is only one part of the equation.  It needs to extend across every practice and span entire organisations. It is about cultivating a renewed mind-set, leveraging innovation, and providing a platform for emerging technologies to solve some of the greatest challenges facing society. This requires a rounded strategy based on responsible business practices involving key stakeholders at multiple levels. Governments are now primed and positioned to lead the way through driving spending that can support, empower, and enable businesses to see the true potential in innovation – and transform the theoretical into reality.

To meet global targets and halve emissions by 2030, we need to maximise technologies at different levels of development. Cloud computing, first-generation industrial automation, and 3G and 4G mobile networks, among others, already serve as a foundation for big efficiency gains. Next come 5G, AI, data innovation, and drones, which all depend on connectivity and open up completely new opportunities. With the right policy frameworks and a strong climate vision, these technologies will be instrumental to moving society towards a circular and lean economy, focused on growing service value while reducing waste and pollution.

The possibilities for technology to empower sustainability and circularity are already here, and the past year has shown that when we come together for a common cause, we can overcome pressing societal challenges. Now, we have the opportunity once more to seize the moment and chart a better course for our recovery – with sustainability and resilience at its heart. It’s up to policy makers, people, and business to collaborate and put technology to work so we can build back better.






[5] Artificial intelligence and the circular economy: AI as a tool to accelerate the transition | McKinsey


About the Author: Adrian Iannessa

Global Services Leader, Dell EMC