Environmentally sustainable business in the era of advanced technologies?

We have moved into a new geological epoch, an unprecedented era in which a certain species—Homo sapiens and in particular, certain groups of Homo sapiens, mainly concentrated in high-income countries—is changing nature more severely than natural processes are. Most of us living in high-income countries are overconsuming the Earth’s resources. As we do so, we are wiping off forests, polluting waters, changing climate and driving other species to extinction—on daily basis. As an example, between 2015 and 2020, we lost 10 million hectares of forests each year. Our destructive consumption is endangering all species, including ourselves.

We also live in the era of digital technologies. Their rapid advancement is arguably one of the main reasons behind the gloomy future of the environment. Advanced digital technologies, such as 3D printing, advanced robots and big data analytics, have led to faster, cheaper and more customized production. Manufacturing any product ultimately relies on using natural resources. Besides, advanced technologies usually consume a lot of electricity to function, which is environmentally unsustainable. Further, these technologies often rely on precious and rare earth metals. Extracting these materials usually comes at the expense of interfering with and damaging the complex and delicate soil ecosystem. Not to mention that marginalised communities living in areas where these resources are found are also vulnerable to land-grabbing, and big corporations are notorious for neglecting their needs. If things remain as they are, the future for an environmentally sustainable world looks dispiriting. Can we remain hopeful? Can the technologies I just mentioned also make manufacturing more environmentally sustainable?

Perhaps, the very same technologies could offer a glimmer of hope on the bleak outlook for the natural environment. For example, the integration of big data analytics and robots equipped with sensors can transform a supply chain into a smart system that can make manufacturing more flexible and environmentally friendly. These technologies can promote cleaner manufacturing too because they allow companies to manufacture products without generating much waste. They also enable firms to control their consumption of energy, water and raw materials.

Take 3D printing. To manufacture a product via the technology – say a toy or a medical instrument – you only need a 3D printer (which is now cost-effective and more available), a computer and a software to design an initial digital model. So the production consumes less space and energy and can take place geographically closer to customers, thus potentially reducing CO2 emission caused by the transportation of final products (note that still extracting and transporting of raw materials can damage the environment). Furthermore, as opposed to conventional manufacturing methods, 3D printing generates little or no waste. Raw materials may even be supplied from waste plastics, which enables efficient recycling of these non-biodegradable and environmentally hazardous wastes. I do not mean to imply that manufacturing by 3D printing is 100% sustainable, rather my point is that it provides the possibility to make manufacturing slightly more sustainable.

Let’s have a look at the Internet of Things as another example. The Internet of Things uses sensors to connect devices and physical objects so that they can communicate with one another over the Internet. For starters, it can provide reliable data about the energy consumption of objects and energy flow from one device to the other. These smart devices record and communicate information about themselves and their environment. The information can be used to decide when and how the devices should be repaired, reused, remanufactured and recycled, thus making it possible to extend the lifetime of products and reduce consumption of new resources. For example, smart devices provide information about their statuses, such as their current condition, usage and surrounding environment. Therefore, not only is it possible to repair these products immediately when needed but also to predict when maintenance is required to avoid future failures. The result is a drastic increase in the lifetime of smart products.

This technology has already been adopted. For example, Caterpillar, a well-known international construction company, is relying on the Internet of Things to connect its vehicles and machinery, ranging from forklifts to heavy manufacturing engines, to provide predictive maintenance and increase the productivity of its machines. Or a venture called Enerbrain, has developed a system that uses the Internet of Things and artificial intelligence to gather data on buildings and provide the best output regarding temperature, humidity and CO2 by analysing the data. The system can automatically improve the energy efficiency of buildings.      

Here also enters big data analytics into the picture. Using big data analytics, companies can make sense of the vast amount of data that are readily available these days. This technology and the Internet of Things are highly interrelated. To benefit from the Internet of Things, we first need to analyse the data that smart devices provide. Such data are huge and initially unstructured, but can be analysed using analytics techniques such as machine learning. This helps accomplish the goals described above, for example, to forecast maintenance and evaluate environmental issues such as higher than usual energy consumption by some of the devices. Thus, big data analytics combined with the Internet of Things can help companies engage in more environmentally sustainable business.

Again, let’s not forget the dark sides of these technologies. For example, the Internet of Things and big data analytics raise serious ethical concerns regarding privacy and information security. Devices connected via the Internet of Things collect large amounts of user data that may be analysed and shared without the users’ consent. These technologies are not a panacea for all our environmental problems either. As I mentioned earlier, they can even be harmful when it comes to the environmental sustainability of today’s production practices. Even when adopting these technologies for manufacturing purposes seems more sustainable than relying on conventional production practices, whether they are environmentally sustainable enough, is still a matter of question.

Whether we like these technologies or not, they are already transforming the global economy, and many companies are embracing them (though some also oppose their adoption because of, for example, moral and legal concerns). My point is that we can remain hopeful. These technologies could help us move toward a more environmentally sustainable production system. What I mentioned above is but a few examples of how they do so. And this is the core idea behind my research: Whether or not doing environmentally sustainable business in the era of advanced digital technologies is a viable choice.   

Alan (Ali) Ahi is a postdoctoral fellow at the University of Helsinki, Forest Economics and Marketing Research Unit. Prior to this position, he worked as a postdoctoral researcher at the School of Business and Management, Lappeenranta University of Technology, Finland. His research interests include broad areas of international business and entrepreneurship, with a current focus on environmental sustainability and digital technologies. His work has been published in journals such as the Journal of International Marketing, International Business Review, European Business Review and Critical Perspectives on International Business and as chapter contributions to edited volumes.


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