Market Opportunities Drive Green Technology

February 13, 2008

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Forty percent of technology executives claim the green movement creates significant market opportunities for their companies, as evidenced by a noticeable increase in customer demand for green products and services, according to Technology Executive Connections: Going Green: Sustainable Growth Strategies, a study from PricewaterhouseCoopers.

Additionally, 60 percent of respondents cite energy savings as one of the most important factors in their company’s environmental decision-making process. According to the survey, 61 percent of executives feel it is very important (29 percent) or important (32 percent) that their companies take steps to reduce their environmental impact. This shift towards green products, services and business operations is having a direct impact on the level of collaboration and innovation found throughout the entire technology value-chain, including marketing, HR, R&D processes, manufacturing, and supply chains.

As organizations continue to evaluate their own business practices, they are paying closer attention to the actions of their partners and suppliers as well. One in five executives (18 percent) claim their companies practice environmentally preferred purchasing, where organizations select products and services that have a lesser effect on the environment than competitive products and services. Within the next two years, this figure will rise to over half (53 percent).

Technology organizations are also taking steps to safeguard themselves from stringent government legislation and regulations in the future by proactively imposing their own green-oriented controls. Twenty percent of survey respondents say their companies maintain a formal and widely distributed environmental policy. This figure will increase significantly over the next two years, jumping to 48 percent. To further reduce the risk of government regulations, technology companies are implementing a range of other environmental processes such as assessing compliance with internal green practices, appointing senior executives to oversee green programs, and creating a clearer linkage between green initiatives and performance.

While global organizations across all sectors are striving to become more environmentally responsible, the effects of the green movement on hardware manufacturers compared to software companies varies substantially. The statistics demonstrate greater interest and associated green activity from technology manufacturers relative to service-oriented businesses, such as software providers and content developers. According to the survey, 60 percent of technology manufacturers are developing green products and services, compared to only 33 percent of non-manufacturers.

Technology manufacturers are taking aggressive steps to expand their portfolio of green products and services by pursuing energy efficiency, implementing designs that reduce or eliminate the use of hazardous materials, using recycled or recyclable materials, building products that last longer, and creating packaging that meets or exceeds global environmental standards. A growing focus on reducing the weight of products and improving their capacity for recycling is also helping manufacturers better address “end of life” issues such as the recovery and disposal of products that have run their course.