Increasing concerns about the effects of climate change and socio-economic disparities have made environmental, social, and governance (ESG) compliance and reporting a front-burner issue for organizations around the globe. But ESG is not just a program for the organization as a whole. It has implications for each area of the business. And one of the most important areas is the data center.

Data centers in many regions are being asked (or told) to pay closer attention to ESG principles and to improve their ESG scores. One of the major ways ESG applies to the data center is in achieving measurable results in sustainability programs. Here are some of the key points to address when introducing or expanding ESG efforts within the data center.

Align IT with Organizational ESG Initiatives

ESG may be new to some data centers. But it is front and center in many of the corporations that own data centers and colocation facilities. The wrong way to go about ESG in the data center, therefore, is to draw up a plan in isolation. The likelihood is that HR and corporate management have already devised an overarching ESG strategy. It is up to the data center manager to find out what that plan is, where IT fits in and to originate further areas where the data center can become involved.

In addition, integration is needed with overall IT planning. The CTO or data center manager may be in the midst of a short-term or long-term program to expand operations, modernize the infrastructure or digitally transform. Instead of drawing up a separate ESG plan for the data center, align and integrate ESG efforts with ongoing IT strategy.

“ESG efforts within IT often remain disconnected from the core IT strategy,” said Chandrika Dutt, an analyst at research consultancy Avasant. “The key challenge is integrating sustainability across each IT initiative so that the IT strategy and road map accomplish business, IT and ESG goals.”

Aim for the Low-hanging Fruit – Energy Efficiency

A central target for environmental improvement programs in the data center will be energy efficiency. As obvious place to start for data centers managing huge amounts of data is storage reorganization. The likelihood is that large quantities of rarely accessed data are being retained on disk. If so, energy consumption from spinning disk should be regarded as low-hanging, energy-efficiency fruit.

Brad Johns, an analyst with Brad Johns Consulting, compared the long-term cost of tape to disk storage. Offloading infrequency accessed or cold data to tape is a good way to sharply reduce energy consumption.

“The ten-year total cost of ownership (TCO) of 10 PB of storage (with capacity growing at 35% annually) on tape was found to be about eight times cheaper for just the cost of power compared to disk over that period,” said Johns.

Address Emissions and the Carbon Footprint

Data center power and cooling account for about 1% of the total electricity consumption worldwide, according to Avasant, and about 1.4% of total carbon emissions. Anyone in the data center that is initiating ESG actions or involved in discussions to reduce data center emissions and the overall carbon footprint is sure to find ESG allies within the enterprise. Further, they will find plenty of support from the vendor community. All of the hyperscalers as well as a great many of the major IT vendors are thoroughly engaged in carbon reduction programs including the likes of Nvidia and Intel.

“Together, we’re working to build a more sustainable path to powering the most challenging workloads on the planet,” said Jeff McVeigh, corporate vice president, and general manager, Super Compute Group, Intel.

On the emissions front, there are plenty of steps that data centers can take. Switching from diesel to natural gas generators, adding sources of renewable energy to the power mix, changing out aging equipment and replacing it with energy efficient alternatives – all will help to reduce emissions and lower the carbon footprint.

Use ESG for Competitive Advantage

It is easy to look at ESG as yet another compliance burden. A more sensible viewpoint is to harness ESG for competitive advantage. How? Dutt noted that data center customers tend to favor suppliers aligned with global sustainability objectives when they are making procurement decisions. There will be pressure, then, from customers who want to know the ESG and carbon footprint specifics of the data center. Those who can’t cite numbers, ESG scores or demonstrate tangible progress are likely to lose business.

“When given a choice, many customers choose to buy from companies that prioritize sustainability and social responsibility,” said Laurie McCabe, an analyst at SMB Group.

But it isn’t just customers. The hyperscalers and many large colos have already enacted stringent ESG programs. Some demand that their data center partners and suppliers all meet the same standard. Banks, too, are getting in on the act. Some only loan to those with acceptable scores.

Use ESG to Attract Employees

The younger generation, in particular, is very much aware of sustainability programs. Many only want to work for environmentally responsible firms. With the data center hiring picture being so grim, ESG may make all the difference in attracting a younger workforce. In many ways, this has everything to do with the corporate brand.

 “Businesses are becoming increasingly aware that a vigorous ESG program can strengthen their corporate brand, promote sustainable growth and improve operational efficiencies,” said Dutt.