ANZ needs to catch up with ASEAN for sustainable IT practices

Paessler AG, a leading provider of IT monitoring solutions, has commissioned Intuit-Research to assess the current state of sustainability practices among businesses in Australia, New Zealand and ASEAN, with research indicating an optimistic business outlook over the next three years in the ANZ region despite falling behind in terms of sustainability.

67 per cent of businesses in the ANZ region stated they were very optimistic. Meanwhile, those in Singapore had a more conservative sentiment, with 23 per cent expressing uncertainty or pessimism. This positive outlook for ANZ bodes well for investments in priority areas to drive future business growth; however, environmentally conscious investors may steer clear of businesses that do not have an Environmental, Social and Governance (ESG) sustainability scorecard.

Paessler’s survey involved in-depth interviews with 200 business decision-makers from large enterprises with revenues ranging from 50 million to over $1 billion across three key sectors: Manufacturing, Essential Services (including Utilities, Public Transport, and Hospitals), and Tech/Telecom/Data centres. A fifth of these were from Australia and New Zealand (ANZ) organisations.

The pandemic has accelerated digital transformation efforts across all markets and sectors, leading to higher growth rates and improved resilience despite supply chain disruptions. In keeping with this trend, digital transformation emerges as the top priority for businesses across the ASEAN markets (66 per cent), whereas only 38 per cent of ANZ businesses stated it as a priority.

“Digital transformation can enable sustainability by making businesses more efficient, reducing their environmental impact, and helping them meet sustainability goals, so it is concerning that there is a disconnect for businesses in Australia and New Zealand with a much lower share seeing digital transformation as a priority,” said Amit Phatak, Director and Partner of Intuit-Research.

Since the pandemic, the priority for businesses in ANZ is innovation to drive growth (60 per cent) followed by increasing efficiency and productivity (55 per cent) whilst sustainability, including ESG practices, is the third most important priority for ANZ businesses (50 per cent). On the other hand, Australian businesses are the furthest along when it comes to having a clear sustainability strategy and acting on it (63 per cent versus 44 per cent for ASEAN).

Despite embracing sustainability and ESG adoption, businesses in ANZ are significantly behind their ASEAN peers regarding their sustainable IT strategies, with only 48 per cent already having one, whereas in ASEAN it is 72 per cent. However, the remaining ANZ businesses (52 per cent) plan to have one within the next year.

All the ANZ organisations Intuit-Research spoke to said that monitoring their IT systems and infrastructure had enabled them to reduce emissions, which is the key sustainability focus for the ANZ firms. Due to their infrastructure monitoring, many adopted other sustainable IT strategies such as optimising power usage, hardware utilisation and improving energy efficiency.

Manufacturing and Essential Services sectors prioritise diversifying and tracking supply chains in real-time across ASEAN (60 per cent), while Tech/Telecom and Data Centres emphasise sustainable IT strategies, greener data centres, and on-premises to cloud migration (80 per cent).

Despite sustainable IT strategies being on the radar for 100 per cent of businesses in ANZ, most believe there is room for improvement in their capabilities, with only 62 per cent of ANZ businesses acknowledging moderate to low or no in-house competency in sustainability practices.

The top barrier to adopting sustainability practices for ANZ businesses is the lack of clarity from governing bodies (50 per cent) followed by the cost of deployment (48 per cent) and the lack of technical know-how on planning and implementation of sustainable practices (48 per cent).

Sustainability and digital transformation are often perceived as separate initiatives, leading to a fragmented approach to developing sustainability frameworks. Many ANZ businesses have focused on achieving specific corporate metrics related to emissions, recycling, and water or energy consumption. Reputation (45 per cent), industry standards (36 per cent), and regulatory compliance (24 per cent) were the main drivers for adopting sustainable frameworks in ANZ.

“Paessler emphasises the interconnectedness of building a robust IT strategy, digital transformation strategy and sustainability framework. Businesses must overcome siloed approaches and recognise that these areas are part of the same puzzle. By improving awareness and knowledge of sustainable IT strategies, backed by effective IT monitoring provided by solutions like Paessler PRTG, businesses can reduce their carbon footprint, become net neutral, and accelerate progress towards achieving their sustainable development goals,” said Felix Berndt, regional manager for Asia Pacific at Paessler AG.

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