Sustainable IT: The Hidden Carbon Crisis at the Core of ESG

The Digital side of ESG

What if your laptop, your cloud storage, or your favorite AI app emitted as much carbon as driving a car? That question is no longer hypothetical. Enterprise IT is emerging as one of the fastest-growing sources of greenhouse gas emissions, rivalling traditional heavy industries.

The scale is striking. According to the International Energy Agency (IEA), global data centers consumed around 415 terawatt-hours (TWh) of electricity in 2024, more than the total annual electricity use of the United Kingdom. By 2030, that figure could more than double to 945 TWh, driven largely by artificial intelligence and the rapid expansion of cloud computing. Policymakers warn that AI-era data centers risk overwhelming power grids and undermining national climate commitments.

Placed in the global picture, total carbon dioxide (CO₂) emissions are projected by the World Meteorological Organization (WMO) to reach 41.6 billion tonnes in 2024, up from 40.6 billion tonnes in 2023. Within this context, the ICT sector, including devices, networks, and data centers, contribute an estimated 1.8%–2.8% of total global emissions, a share already comparable to that of the aviation industry. Electronic waste adds another dimension: the world generated over 62 million tonnes of e-waste in 2022, and less than 25% was properly recycled (UN Global E-Waste Monitor 2024).

If IT were considered a nation, it would already rank among the top ten emitters of CO₂ globally, and its footprint is growing at an accelerating pace.

Each time we log on, run workloads, or refresh a device, we are adding to an expanding carbon ledger. For companies like Cyient, IT is no longer just infrastructure in the background. It has become a strategic lever for sustainability performance, shaping multiple dimensions of ESG reporting and business outcomes.

To understand why, consider three main areas where IT has an impact:

• Scope 2 emissions: These come from the electricity used in cloud services, servers, and data centers. Think of racks of servers running 24/7, which now make up one of the largest components of corporate energy bills.
• Scope 3 emissions cover the embodied carbon from manufacturing, transporting, and disposing of thousands of laptops, servers, and networking equipment. Often overlooked, these indirect impacts can be significant across the supply chain.
• Water use. Data centers require enormous volumes of water for cooling. This is captured by Water Usage Effectiveness (WUE) metrics, as used in industry benchmarking and is especially critical in water-stressed regions. Cooling towers at hyperscale facilities are a prime example.

Taken together, these impacts mean digital carbon is a measurable contributor to a company’s footprint. Regulators are reinforcing this reality. The EU’s Corporate Sustainability Reporting Directive (CSRD) requires IT-related emissions to be disclosed with the same rigor as physical operations. In India, SEBI’s BRSR Core framework also demands assured ESG disclosures, explicitly including digital operations and value-chain impacts. Non-compliance can carry costs in fines, investor scrutiny, and reputational damage.

In short, overlooking the carbon cost of IT today risks non-compliance tomorrow and weakens both credibility and competitiveness in global markets.

The essential insight is that tackling digital emissions does not only help the planet, it also saves money and builds resilience. A credible sustainable IT roadmap usually unfolds in three parts: infrastructure, software, and devices.

1. Smarter Infrastructure

• Run workloads in cloud regions powered by renewables and negotiate contracts that match energy use with renewable generation on an hourly basis.
• Track PUE (Power Usage Effectiveness) and WUE (Water Usage Effectiveness). Best-practice targets are PUE ≤1.3 and low WUE in water-stressed geographies. Leading hyperscale operators now publish these metrics annually, offering benchmarks for enterprise customers. For example, Google reports a comprehensive trailing twelve-month (TTM) PUE of 1.09 across all its large-scale data centers (once they reach stable operations, in all seasons), while Microsoft reports an average annual PUE of 1.125 across its latest data centers and publicly tracks both PUE and WUE at its Azure facilities. These benchmarks provide practical reference points for enterprises seeking to match or exceed industry leaders.
• Follow the EU Code of Conduct for Data Centres for best practices in airflow, hot/cold aisle containment, and cooling innovations.

2. Greener Software & Data

• Measure application efficiency using the Software Carbon Intensity (SCI) standard, integrating it into DevOps pipelines so efficiency is tracked like performance or security.
• Optimize AI workloads by right-sizing models, using distilled or sparse versions where possible, scheduling training when renewable power is abundant, and deploying inference on energy-efficient hardware.
• Implement strong data governance: prune unused datasets, archive cold data to low-energy storage, and minimize redundancy to cut both costs and emissions.

3. Circular Devices

• Extend device lifespans, ideally four to five years where performance permits, to reduce embodied carbon.
• Procure laptops and monitors with EPEAT registry and ENERGY STAR ratings, ensuring lower lifecycle emissions.
• Set up structured repair, refurbishment, reuse, and vendor take-back programs to cut Scope 3 emissions while lowering procurement costs.
• Track circularity metrics, such as average device age and return and reuse rates, to demonstrate progress in sustainability reporting.

What success look like

Cyient has already set clear sustainability goals and reported tangible progress. Instead of hypothetical numbers, here are real outcomes that demonstrate both environmental responsibility and business value:

• Carbon and Water Neutrality Goals: Cyient has committed to becoming carbon and water neutral by 2025, a target covering all three scopes of emissions
• Renewable Energy Usage: Major Cyient offices are now powered by 75% renewable energy as of FY24, reducing Scope 2 emissions significantly.
• Circular Economy Initiatives: The Cyient Foundation has supported large-scale tree-planting projects, demonstrating our long-term commitment to environmental sustainability. Every year, we plant over 15,000 saplings in and around our facilities, adopted schools, skill centers, and local communities. Over the past nine years, we have planted more than 106,000 trees with an 85.5% survival rate—a dedication that has earned us the CII Telangana award for nine consecutive years. This year alone, we planted 15,864 saplings, taking our cumulative total to more than 1.2 lakh trees in ten years.

These outcomes go beyond sustainability headlines. By openly sharing progress and metrics in areas such as energy efficiency, emissions reduction, and resource use, Cyient shows how transparency drives accountability. This transparency translates into tangible cost savings through energy efficiency, stronger resilience to regulatory pressures, and increased confidence from investors and stakeholders who expect verifiable ESG performance.

Building on this foundation, at Cyient we believe sustainable IT is no longer optional—it is essential. It reduces risk, improves efficiency, and strengthens the trust we build with our stakeholders. By tackling our digital carbon footprint today, we are laying the groundwork for a stronger, more sustainable tomorrow. This commitment is not just a corporate mandate, but a shared responsibility. We invite our peers, partners, and clients to walk alongside us, because only by acting together can we turn digital transformation into a true force for sustainability.

Learn more about our journey on the Cyient ESG Initiatives page.

About the Author

Katie Cook,
President, Corporate Functions,
North America

As President of Corporate Functions, North America, Katie Cook champions sustainability as a core driver of business transformation. With more than 30 years of leadership in technology and engineering services, she has advanced Cyient’s growth by embedding sustainable practices into operations, innovation, and customer-focused strategies. Based in Meridian, Idaho, Katie blends technical expertise with collaborative leadership to deliver scalable solutions that accelerate digital transformation while ensuring long-term environmental, social, and business impact.