Enhancing market reputation and competitiveness through corporate climate leadership 

Our Global Head of ASPIRE Managed Services, Marcus Cox, delves into the world of CLAs.

In 2024, there are very few global organisations not taking a proactive approach to reducing greenhouse gas emissions, mitigating climate risks and supporting the transition to a low-carbon economy. In global business today, these initiatives are viewed as markers of credibility. Corporate climate leaders are demonstrating their commitment and responsibility to their stakeholders, customers, employees, and society by setting science-based targets, reporting their progress, and collaborating with others to scale up their impact. But is this sufficient? Can more be done? 

What about your service providers? According to the Greenhouse Gas Protocol, scope 3 emissions account for more than 75% of the average company’s carbon footprint, and can be up to 90% for some sectors, such as IT services. However, only 25% of companies report their scope 3 emissions, and even fewer have reduction targets or strategies for them.  

Transparency and Accountability 

A staggering 67% of organisations lack mandatory IT carbon footprint reporting, leading to a significant transparency gap in digital carbon footprints. But what if you had a mechanism to bridge this gap, providing full visibility and accountability for an IT solution’s carbon footprint? 

The Urgency of Action 

The need for immediate and decisive action in the face of climate change cannot be overstated. There is an opportunity for your organisation to improve your environmental performance and reputation, as well as reduce your costs and risks associated with climate change.  

Managed services must do more 

Your organisation can obtain data and insights on your scope 3 emissions from the services you use, as well as tools and solutions to improve them, by partnering with a managed service provider that provides Carbon Level Agreements (CLAs).   

Carbon Level Agreements: The New Frontier in Managed Services 

In the rapidly evolving landscape of managed services, Carbon Level Agreements (CLAs) have emerged as a game-changer, aligning with the global push towards sustainability and corporate responsibility. As we delve into the intricacies of CLAs, we uncover their potential to not only reduce carbon emissions but also to drive significant business value. 

Carbon Level Agreements are a way to proactively control and lower the carbon emissions from the services you use. A CLA is a promise to handle and decrease the carbon emissions in a managed service and can help your organisation obtain these benefits: 

• Improve your social and environmental impact and brand reputation by showing your leadership and dedication to sustainability and climate action 

• Gain a competitive edge in the market by lowering the emissions produced from service consumption 

• Reduce your organisation’s exposure to regulatory and reputational risks by following the current and upcoming carbon regulations and standards, as well as satisfying the demands of your investors, employees, and customers 

A CLA is not only a smart and responsible choice for your organisation, but also a strategic and profitable one. A managed service provider can help you measure, monitor, and reduce your scope 3 emissions, as well as enhance your reputation and competitiveness in the market. 

So how do CLAs work? Through a clear four-step process: 

1. 1. Baseline: measure the current carbon footprint of business applications and benchmark the carbon efficiency of the applications against standards and best practices
   2. Optimise: identify and implement opportunities to improve the carbon efficiency of your applications, such as right-sizing, consolidation, rationalisation, modernisation, and archiving. Utilise Cloud Service Provider’s carbon-aware features, such as selecting regions with lower carbon intensity, scheduling workloads to run at times of lower grid demand and using renewable energy sources where possible
   3. Monitor: continuously monitor and report on your carbon emissions and efficiency of your applications, using dashboards, alerts, and analytics. Track the progress and impact of your optimisation actions and provide regular feedback and recommendations
   4. Improve: continually review and update the CLAs, based on your changing needs and priorities of your services, the evolving cloud technologies and capabilities, and the emerging best practices and standards

Measuring Success 

The efficacy of CLAs is gauged through tangible metrics such as the reduction in carbon emissions, cost savings, and enhancements in application efficiency. These benefits are not only measurable but also provide you with high-level visibility and continuous monitoring through advanced dashboard systems. 

Strategic Value and Implementation 

CLAs are not just about meeting sustainability targets; they are about integrating environmental responsibility into the core of business operations. By focusing on reducing carbon emissions through server utilisation, greener architectures, and cost optimisation, CLAs offer a strategic value that goes beyond compliance. 

Real-World Impact 

The collaboration between Version 1 and TRL (The Future of Transport) serves as a testament to the practical application and impact of CLAs within a managed service. This partnership demonstrates how CLAs (as part of our ASPIRE Managed Services) are effectively implemented to monitor, measure, and improve sustainability goals, providing a blueprint for others to achieve greater than 20% emission reductions across specific services.  

Summary 

In conclusion, the significance of CLAs in the realm of managed services becomes clear. They are not just agreements; they are a commitment to a sustainable future, a strategic business decision, and a step towards corporate climate leadership.  

The integration of CLAs into managed services is a bold move that will define the path of environmental responsibility for years to come. 

Written by Marcus Cox

Marcus Cox is the Head of ASPIRE Managed Service offerings, and with a laser focus on business outcomes, he ensures our ASPIRE Managed Services align with industry best practices and meet the unique needs of each customer. Marcus has extensive experience in managing complex technology environments, optimising architectures, and driving operational efficiency. His expertise spans a diverse range of technologies and service delivery models. He is committed to fostering strong client relationships and continuously improving our ASPIRE service offerings.