Leading mobile operators pledge collective, consistent disclosure of climate impacts
Back in February 2016, shortly after the United Nations Sustainable Development Goals officially were adopted, the worldwide trade association representing most of the world’s leading mobile companies launched an industry-wide push to encourage corporate action supporting them.
Now, responding to pressure from investors all around the globe, the group, GSMA, is kicking off a coordinated effort aimed at improving and standardizing how they disclose climate risks.
This week, more than 50 of the largest wireless network carriers representing two-thirds of mobile connections globally — including AT&T, BT Group, China Mobile, Deutsche Telekom, NTT, Orange Group, SoftBank, Vodafone, Verizon and a who’s who list from around the world — collectively agreed to report information about climate impacts, energy transition plans, greenhouse gas emissions and other ESG concerns using the CDP global disclosure system.
What sorts of concerns should investors have? A vivid illustration comes from California. Earlier this month, the Federal Communications Commission requested information about the contingency plans of cellular service providers including AT&T, Sprint, T-Mobile, U.S. Cellular and Verizon in cases where the state's utilities are directed to switch off power during periods of high wildfire risk. According to coverage in the San Francisco Chronicle, towers can operate for four to 72 hours on existing backup systems. Some providers, via the organization Green Touch Consortium, worked on a five-year project toward the goal earlier this decade. As carriers build out next-generation 5G wireless networks, making sure they run as efficiently as possible and that the sources are increasingly cleaner are central concerns.
Being more transparent is just the first step. GSMA is also coordinating the development of what it calls an “industry-wide, climate action roadmap," aligned with the Science Based Targets initiative (SBTi), for achieving net-zero emission GHG emissions by 2050, the goal set out by the Paris Agreement. Many individual companies plan to use this initiative as the foundation of dialogues and meetings next week during the climate meetings in New York, including the United Nations General Assembly, as well as at the Mobile World Congress Americas conference in Los Angeles in October.
Inspired by investors
By choosing one platform for disclosure, the mobile operators are seeking to make it simpler for investors to compare the plans of companies across the wireless communications sector, something they increasingly have been requesting, said Mats Granyrd, director general of GSMA, during a conversion with GreenBiz.
"A lot of investors are keen to understand individually how companies are doing but want to see it done in a consistent way," he said.
Granyrd said many operators that agreed to join the initiative — some have opted out for now, citing resource issues or strategic timing or other concerns — will be reporting for the first time as part of this collaborative push.
They’ll be asked to respond in detail about Scope 1, 2 and 3 emissions, as well as issues such as energy intensity, renewable energy strategy, the use of carbon pricing and scenario analysis, emissions reduction targets, investments in low-carbon equipment and technologies, and how climate is considered as part of broader business strategy, according to a briefing document in detail.
The bulk of emissions related to a mobile operator’s own operations lie in Scope 1 (for things such as fleets, buildings and back-up generators) and in Scope 2 (mainly related to the power to run networks and data centers). But GSMA estimates that the large majority of operators’ total GHG emissions are Scope 3 in nature, embedded across suppliers and other members of the value chain.
There’s much that carriers can do to influence climate action there, the organization believes. That includes connecting corporate buildings and facilities for energy management, supporting vehicle telematics for reducing fuel consumption, diverting emissions that would have been expended on travel and commuting, enabling precision agriculture, empowering rural economies and so on. Those new solutions also will drive additional mobile traffic across wireless networks, so many companies across the industry are focusing on how to ensure that each new generation of connectivity is more energy-efficient than the last.
"The mobile industry will form the backbone of the future economy and therefore has a unique opportunity to drive change across multiple sectors and in collaboration with our suppliers, investors and customers," Granyrd said in the press release for the initiative.
A history of industry-wide collaboration
To be clear, not every company in the GSMA’s membership is part of this initiative, at least for now. The group includes more than 750 operators, as well as 350 other companies that are part of the industry such as software developers, handset and device manufacturers, internet companies and network equipment providers.
But the operators that have signed up represent about 5.2 billion mobile connections, out of the 7.8 billion reported worldwide at the end of second quarter. (That doesn’t include internet of things links.) GSMA expects at least 60 operators to be involved by February, when the organization expects to unfurl a decarbonization pathway framework with the SBTi; to date, a sector-related framework of this sort hasn't been available for companies to consult.
The initiative was borne out of a call to action launched earlier this year, one that recognized that the sorts of technologies that the mobile industry provides writ large could be vitally critical to climate solutions — and that the sector needed to focus on how to scale up their businesses quickly without exacerbating the problem.
The energy footprint of mobile networks is estimated at about 130 terrawatt-hours annually, with a footprint of about 110 metric tons of CO2 equivalent. That’s about 0.2 percent of global GHG emissions. If you add in the impact of mobile phones, the impact is about 200 MtCO2e, according to GSMA, or about 0.4 percent of global GHG emissions.
The forthcoming decarbonization pathway will allow companies to set their own targets, as well as a timeline for delivery; renewable energy isn’t as readily available in some remote or off-grid locations as others, for example. Right now, those transmission sites may run on diesel generators and until broader transmission investments are made, the industry needs to find workaround solutions.
The Global e-Sustainability Initiative (GeSI), which represents information technology and digital infrastructure companies, and International Telecommunications (ITU) are collaborating on the development of the framework. "We’re very excited with the pickup and interest of the mobile operators," Granyrd said. "Their reaction has been great."
GSMA considers the disclosure pledge and commitment to science-based goals to be an extension of the industry’s intense focus on committing to the SDGs, Granyrd said. The group scores progress on all 17 goals based on how well the industry is delivering on its potential impact.
According to the report, based on GSMA analysis, so far the mobile sector is making the biggest contribution toward SDG 9 (Industry, Innovation and Infrastructure). For example, as of 2017, almost 600 million have access to mobile internet services, most in low-income and middle-income countries, and more than 250 million globally have access to mobile financial services. As of that timeframe, 5 million people had used services offered as part of the mNutrition Initiative, which supports farmers looking to improve their productivity and income. But even then, that work only gets a score of 51 out of a possible 100 for achieving its potential. Two other areas where the industry gives itself a relatively good grade: SDG 4 (Education) and SDG 13 (Climate Action).
The areas in which the sector believes it made the most progress between 2017 and 2018 were on SDG 13 (Climate Action), SDG 11 (Sustainable Cities and Communities) and SDG 3 (Good Health and Well-Being). During 2017, for example, mobile operators involved with the Humanitarian Connectivity Charter supported more than 30 million people recovering from natural disasters and other crises. (You can find the latest SDG impact report here; the 2019 edition is due in coming weeks.)
"We have discrete targets around almost all of the targets," Granyrd said.