The twin transition is the route to sustainable profitability
This decade is crucial for climate action. Digitisation will play an equally crucial role in this activity: according to the WEF, digitisation can potentially reduce global CO₂ emissions by 20%. This interplay between digitisation and sustainability is called the twin transition. By embracing the twin transition, organisations can simultaneously achieve sustainability goals and make themselves more future-proof.
What is the twin transition and why is it important?
The twin transition recognises that there is a huge, untapped potential for technology and data to drive sustainability. Instead of tackling digital and sustainable objectives separately, a twin transition strategy combines these two trajectories to intertwine sustainability with efficiency and productivity.
Digitisation in itself seems sustainable. Because if we work from home, for example, we don't have to get in the car. By optimising digital assets and infrastructure to limit the environmental impact, organisations can kill two birds with one stone: working more sustainably and more efficiently.
While the urgency of a twin transition is clear, it’s easier said than done to put it into practice. Sometimes the approach lacks consistency, at other times people move too slowly because the task is too complex and clashes with existing strategies. The route to establishing collaboration between IT teams and sustainability teams is also far from obvious. The question is: how can organisations remove the obstacles and embark on a twin transition journey which has impact?
How do you get the twin transition off the ground?
While there’s no denying the urgency of the twin transition, many IT leaders are struggling to put it into practice. Twin transitions come with complex challenges: such as the need to involve stakeholders, draw up lines of responsibility, and move beyond the initial concept phase. As a result, few structured plans are implemented.
The most important key to success is collaboration. The creation and implementation of a twin transition roadmap requires innovation, transformation, multi-stakeholder engagement, and good change management. To maximise your momentum, it is advisable for a small, multidisciplinary team to supervise each twin transition. These are people with the right technical skills and knowledge of sustainability who together have an overview of the entire organisation. For example, this should involve not only IT leaders but also those responsible for CSR, the commercial organisation, and operations.
There is also a need to make sure that the most important stakeholders from your ecosystem are included. Broad involvement from different departments and organisations is crucial because the projects in your twin transition will affect business processes, people, infrastructure, policy, and organisation.
There are 3 steps to go through:
Step 1: Be clear about goals
Be clear with yourself and your teams about your goals. “We are going to become more sustainable” is too vague and does not lead to feasible transition scenarios. So make sure you have realistic goals that fit into the broader framework of your organisational strategy.
The trick is to identify ‘hotspots’, the areas in business operations where most emissions occur, or where most resources are consumed. These are the areas where a twin transition leads to a positive impact the fastest.
Step 2: Identify your opportunities
Be critical and realistic about the activities or business processes that you want to digitise/make more sustainable. For example, it is not particularly useful for a transport company to set a primary goal to tackle scope 3 emissions (indirect emissions from business activities, but which are outside the control of an organisation). More generally, it’s just as unrealistic to expect immediate results or to expect digitisation to be the silver bullet for your climate challenges.
A twin transition that has a chance of success is one which makes a holistic assessment of the sustainability impact of digitisation. What are your internal and external dependencies? Can you digitise independently or do you need cooperation from partners in your supply chain? The more dependencies, the more complex and difficult the twin transition will be. However, do not be complacent about this and dismiss this option: it may be that the most positive impact can be achieved by tackling a very difficult challenge. In that case, of course, it is vital to set realistic timelines.
Step 3: Reflect before you begin
The final stage of preparation is to validate your twin transition roadmap. Are the planned activities feasible and do they avoid jeopardising business operations? Is the ‘division of labour’ clear and is there a good framework for the shared responsibilities and definitions of success? Does the board of directors agree?
Twin transition: the conclusion
Digital and sustainable strategies can and should be developed at the same time. But that doesn’t happen by itself. It starts with thorough preparation. This goes beyond setting up a strategy. Buy-in from all stakeholders is just as important, but a carefully developed twin transition roadmap can also help with that work.
A twin transition without proper preparation and buy-in is doomed to fail. But if you take the right steps, you will be able to reduce your environmental impact, improve your digital business operations, and meet your moral responsibility to future generations, by contributing to a more sustainable world.