Toward a Sustainable Japan: NEC's 'Ecology through IT'

Toward a Sustainable Japan: NEC's 'Ecology through IT'

Japanese communications giant NEC is using information technology to improve productivity while reducing paper consumption and the need to transport people and goods.



NEC Corporation, the Japanese information and communications giant, issued a statement in 2003 of its intention to contribute to building a sustainable society through information technology (IT) and networking technologies. The clear and simple slogan adopted was "Ecology Through IT."

By the end of 2003, the number of Internet users in Japan reached 77.3 million, accounting for more than 60% of the population. The country's market for information and communications service industry was worth 116 trillion yen (about U.S. $1.0 trillion) in 2002, and has been the country's largest domestic industry since 1997, when it overtook the construction industry. The information and communications industry also accounted for 11.5% of real GDP, with an exceptionally high average annual growth rate of 7% between 1995 and 2002. (Source: Ministry of Internal Affairs and Communications "White Paper 2004: Information and Communications in Japan")

Information technology has ushered in a wide range of changes that effect lifestyle, industry, education, and many other sectors, meaning that it has already become a type of social infrastructure. It is also expected to play an important role in building a sustainable society.

Founded in 1899, the NEC Group now includes 92 companies in Japan and 103 companies overseas. NEC has consistently helped its corporate customers use innovation in management, while offering solutions to their problems with its IT, networking and semiconductor technologies. With more than 140,000 employees, NEC's consolidated net sales amounted to 4.9 trillion yen (about U.S. $44 billion), with 21% from sales overseas. (Data as of the end of March 2004)

NEC initiated activities aimed at protecting the environment in the 1970s with pollution control programs, and by the 1980s these had developed into a Group-wide framework for addressing global environmental problems. NEC initially worked to reduce environmental impacts associated with the production of hardware such as computers and telephones by reducing waste, managing chemical substances, and reducing carbon dioxide (CO2) emissions. NEC is continuing these efforts through the acquisition by all members of the Group of ISO 14001 Certification (for environmental management systems).

Additional programs launched in the 1990s aimed to make products environmentally friendly by applying life cycle assessment, principles of green procurement and so on. The company is also taking on new challenges such as developing recyclable materials, actively disclosing environmental information and helping build a collection and recycling system for products in Japan.

NEC has thus adopted various measures to make its manufacturing plants and products more environment-friendly. However, in response to growing public concern during the last couple of years about corporate social responsibility and the expansion of IT, the company found it necessary to introduce a whole new approach to meeting social needs and publicizing the across-the-board efforts it is making as a company providing IT solutions.

To reduce environmental impacts in the company's core businesses and contribute to a sustainable society, employees not only in hardware sections, but also software engineers, salespersons and all other employees need to be involved. Hoping to raise environmental awareness on the job, NEC has harmonized its IT solutions with environmental management and in the process created the concept of Ecology through IT. This concept has served to motivate NEC employees in addition to demonstrating the company's environmental stance to society at large.

Hisao Araki of NEC's CSR (corporate social responsibility) Promotion Unit gives the following explanation of the message behind Ecology Through IT: "Our society has reached the limits of growth. We now need to improve business efficiency in every situation so that it tends to promote a sustainable society. Everyone is expected to enhance environmental efficiency while protecting our wealth and security. To this end, IT plays an important role in helping people handle information efficiently through multimedia applications."

Information technology can provide the infrastructure for efficient industries, improving productivity while reducing paper consumption and the need to transport people and goods. These improvements are expected to contribute to better resource efficiency and help prevent global warming. Such improvements are already happening.

For example, one of NEC's clients, a dairy, introduced IT into the supply management system that coordinates the chain of raw material suppliers, production facilities, the sales department and customers. The system was used to optimize production and inventory plans so that they would meet customers' needs and encourage efficient transportation by fully loaded trucks. The company successfully reduced the volumes of inventories and of products that had to be discarded. It was estimated that this system led to 30% lower CO2 emissions compared to the operation before IT was introduced.

Another client of NEC, a drug company, implemented a network system that allows salespersons to access their corporate networks via mobile devices in order to reply promptly on the spot to customers' inquiries about pharmaceutical information. They no longer need to visit customers repeatedly to deliver paper documents. This system is also expected to reduce CO2 emissions by about 30%, even allowing for the increased energy consumption of the network system and mobile devices.

NEC has developed a wide range of Eco-IT solutions that are expected to reduce environmental impacts. These include an e-learning system in which people can study using the Internet and their personal computers without commuting to a classroom, a Web conference on the Internet, and an Internet shopping service that allows customers to order and pick up goods at nearby convenience stores.

The concept of Ecology Through IT is still new and so is not yet widely appreciated, but it has come to be recognized by companies and local governments that have a keen interest in environmental management. "Because environmental impact (e.g., CO2 emission) reductions resulting from IT are not readily perceptible, highly precise simulation data needs to be presented to potential users in an easily understandable form before they are convinced," said Araki.

On the other hand, the growing use of IT equipment may increase electric power consumption and CO2 emissions, producing an adverse effect on the environment.

NEC calculated the sum of CO2 emissions resulting both from its own business activities and from the use of NEC products by customers, and this amounted to 5 million tons per year. The company intends to offset this by reducing CO2 emissions by the same amount by 2010 through applications of NEC IT-based solutions.

As part of the Ecology Through IT campaign, NEC is taking measures to alleviate the adverse effects of IT expansion. For example, it has created a reuse system for personal computers (PCs) called the "PC refresher service," which extends the life of used NEC-brand computers by domestically reselling the refurbished PCs. (PCs are refurbished by cleaning the exterior, reinstalling operating systems, etc.). By developing stronger and more heat- and fire-resistant bioplastics reinforced with kenaf fiber and researching ways to use these bioplastics in building electronic devices, NEC is striving to develop environment-friendly IT hardware.

NEC feels it is essential for each employee to fully grasp the spirit of the campaign and act accordingly to accelerate its promotion. To this end, NEC has been holding compulsory training courses on environmental issues for all employees using an e-learning system. Since 2001 a questionnaire survey has been carried out every year to determine the effect of this training program.

Results of these surveys indicate that employees can be classified into four groups in relation to two areas, environmental knowledge and action performed. The 2003 survey revealed that about one quarter of NEC's 11,292 Japan-based employees could be put into the "Eco-Excellence" category with high scores in both areas.

The surveys also revealed that NEC is determined to increase the number of employees who are aware of environmental issues and can translate the message of Ecology Through IT into action. To accomplish this, the company pays close attention to each employee's progress. We'll be monitoring NEC's campaign closely to see how the company and its employees contribute to building a prosperous society with minimal environmental impact.

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This article has been reprinted courtesy of Japan for Sustainability. Part of the “Toward a Sustainable Japan -- Corporations at Work” series, it was first published in December 2004.