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Digital Transformation

4 ways digital innovation promotes sustainability

The climate crisis grows more urgent by the second. By some expert accounts, we only have about a decade to halt the irreversible damage caused by climate change.

Hopefully, however, a second prevailing trend of this era may prove to be a gamechanger when it comes to fighting climate change: as digitalisation gathers pace in global economies, new technologies are forming a digital toolbox of solutions that may just help to make sustainability an easier goal to achieve.

How is digital innovation promoting sustainability? In a 2020 research paper, Professor Gerard George, Dean and Lee Kong Chian Chair Professor of Innovation and Entrepreneurship at SMU’s Lee Kong Chian School of Business (LKCSB); LKCSB Research Fellow Ryan Knowles Merrill; and Simon J.D. Schillebeeckx, Assistant Professor of Strategic Management at LKCSB investigated Digital sustainability and entrepreneurship: How digital innovations are helping tackle climate change and sustainable development.

Here are four ways tech can help boost sustainability:

1. Collect better data

Technology can now help to collect highly precise and detailed information about complex socio-ecological systems more efficiently. This mitigates blind spots and improves the quality and quantity of knowledge for decision-makers who want to prioritise sustainability.

For instance, American company Saildrone builds and operates a fleet of unmanned drones that sail the oceans independently, collecting high-resolution atmospheric and deep oceanic data. Instead of relying on expensive buoys and manned vessels, these unmanned drones have sensors that can track fish and mammal populations, map sea beds, and monitor temperatures, currents, and hurricane intensities.

2. Create new markets

“Tokenisation” and “packetisation” are two ways new technology can help to create new markets. Tokenisation means using a digital proxy, such as a blockchain token, to represent a previously amorphous unit; while packetisation refers to the bundling of data into small packets.

Together, the two enable businesses to render natural capital into small and tradable units. For example, Poseidon, a Malta-based foundation, is tokenising carbon credits from conservation programmes in the Andean rainforest onto a blockchain, and packetising those credits. When companies and consumers buy these carbon credits, they offset the carbon footprint of retail products and services they are creating and/or consuming.

3. Amplify communication

Climate change is a complex and overwhelming issue, and individuals may not always know how they can make a difference, and may even feel that their efforts are meaningless. Technology can help to make public education of sustainability issues more engaging and effective, and thus catalyse meaningful mindset and behaviourial changes.

For instance, Chinese payment and lifestyle application AliPay has a green initiative called Ant Forest — a game that tracks and rewards sustainable lifestyles. Users earn points for taking actions like walk to work, and can then use these points to plant and nourish digital trees. For each digital tree a user raises to maturity, parent company Ant Financial plants a real-life tree. Besides gamifying sustainability, Ant Forest also maintains engagement through a social game, where users can interact with one another by helping to water friends’ digital trees, for example.

4. Ensure provenance and efficiency

How can companies know for sure that each node in their supply chain is sustainable? Technology can help to improve verification processes. For instance, DiMuto, a Singaporean start-up, is restructuring the fruit and vegetable trade by using technologies such as a blockchain-based track-and-trace system.

A dynamic digital log of agreements, contracts, store locations, delivery times, and transfer points reduces risks of fraudulent data flow, and enables faster identification of volume, quality, and origin discrepancies. Meanwhile, the platform also helps reduce energy loss and food waste, and aids small-scale farmers’ access to inventory-based finance and insurance.

Related Topics:  Sustainability  Business and Corporate 
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