Unprepared Executives Risk $3.1 Trillion Loss Without AI Strategy For Sustainability

• Climate change is causing significant financial damage, and without intervention, global costs could reach $3.1 trillion annually by 2050.
• AI can help optimize energy use, streamline supply chains, and improve climate modeling, but its own environmental footprint needs to be managed.
• There is a pressing need for education and training in AI and sustainability, as many executives are unclear on how to effectively implement AI for sustainability goals.

Climate change is causing more than $16 million per hour in damage to infrastructure, property, agriculture, and human health. 

Without intervention, global costs could soar to $3.1 trillion annually by 2050, according to the new 2024 edX “Harnessing AI for a More Sustainable Future” survey. 

Progress toward a sustainable future has been slow, and many businesses find themselves lacking the necessary skills and resources to keep pace. And keeping up with sustainability initiatives matters for more than just the planet — the competitive advantage of sustainable business practices in attracting and retaining talent is potent.

Sixty-five percent of respondents are more likely to take a job with a company that practices strong sustainability, and 38% would accept a pay cut to work for such a company. 

Luckily for employers, as artificial intelligence (AI) alters the workplace, it also has the potential as a vital tool for tackling some of the most pressing societal and environmental challenges of our time.

Does AI Have a Role in Environmental Sustainability?

AI offers several promising applications in environmental sustainability, as it can predict energy and resource usage, assist in the development of sustainable products, and analyze climate data. Additionally, AI can enhance the human side of sustainability by identifying ways to improve employee well-being.

To explore AI’s potential in shaping sustainable business practices, edX partnered with Workplace Intelligence to survey 600 U.S. C-suite leaders and 1,800 non-executive knowledge workers from various countries, including the U.S., UK, Canada, Germany, France, Spain, India, Singapore, and Mexico. 

Among the executives surveyed, 75% believe their company cannot achieve its sustainability goals without AI. This sentiment is supported by the fact that 96% of C-suite leaders whose organizations have already implemented AI for sustainability report improvements in their progress towards these goals. 

While these statistics are encouraging, there is still a significant gap in operational knowledge: nearly two-thirds (65%) of executives confess they have no idea how to effectively implement AI to support sustainability.

Nearly two-thirds (65%) of executives confess they have no idea how to effectively implement AI to support sustainability.

The growing need for training and development in AI and sustainability is evident, but there is optimism: a substantial majority of employees (84%) and C-suite leaders (92%) are eager to learn. 

Looking ahead, corporate leaders recognize that harnessing AI and adopting sustainable practices are paramount.

There is the pressing question of whether AI is compatible with the concept of sustainability. For example, when OpenAI trained GPT-3, that work produced the equivalent of around 500 tons of carbon dioxide. And after Google implemented its AI summarizer, its greenhouse gas emissions rose by 48%. 

We spoke to Andy Morgan, Head of edX for Business, to understand how AI — an environmental polluter — could be used for good. 

According to Morgan, while AI has the potential to drive progress on sustainability goals, companies must also be mindful of its environmental footprint. 

“AI models, especially those requiring large-scale data processing, consume vast amounts of energy. Companies can weigh the benefits of AI against its environmental costs and, wherever possible, adopt practices like using green energy to power data centers or implementing more energy-efficient AI architectures. Companies like Google and Microsoft are leading the way by reducing their AI-related carbon footprints, and this is a model other businesses can follow,” Morgan told Allwork.Space.

He says that as AI models and architectures become more efficient, we’ll see a reduction in energy consumption for training and deployment. 

“Companies like Apple are already moving in this direction by using distributed AI, which minimizes cloud computing requirements for simpler queries,” according to Morgan.

Morgan explained there are six fundamental ways AI can help companies become more sustainable:

1. Optimize energy efficiency and resource usage across the business
2. Streamline supply chains to reduce waste
3. Improve climate modeling for better decision-making
4. Support sustainable product design and development
5. Aid in sustainable agriculture through environmental monitoring
6. Improve workforce well-being by reducing bias in hiring and performance evaluations

It’s clear that companies will need to heavily weigh the benefits of implementing AI to help with sustainability goals — which is difficult since they are under immense pressure to become more sustainable. 

Corporate Pressure and the Necessity for Sustainability

Businesses are increasingly under pressure from various stakeholders — be it investors, customers, or employees — to prioritize their environmental and social impacts. 

For example, 76% of C-suite respondents acknowledge the mounting pressure from stakeholders, while 90% agree that sustainability investments are crucial for long-term success. Employees, too, are passionate about their companies focusing on sustainability, with 92% deeming it important for businesses to support these goals. Additionally, 82% of workers express a willingness to help their company achieve sustainability targets.

Sustainability is also a key factor for employees when considering job opportunities. Sixty-five percent of respondents are more likely to take a job with a company that practices strong sustainability, and 38% would accept a pay cut to work for such a company. This highlights the competitive advantage of sustainable business practices in attracting and retaining talent.

Sixty-five percent of respondents are more likely to take a job with a company that practices strong sustainability, and 38% would accept a pay cut to work for such a company.

Current Status and Future Trends of AI Adoption

The integration of AI in businesses is already underway, with 81% of employees and 98% of executives reporting the use of AI tools in their roles. The expectation for AI usage over the next five years is nearly unanimous among all respondents. The survey indicates a significant shift in attitudes towards AI, with 82% of employees taking steps to adapt to AI (a jump from 58% the previous year), and more than half (54%) say their companies encourage the use of AI.

“While some of these tools and applications are relatively new, companies that are using AI to improve sustainability practices are already seeing success. In fact, nearly all C-suite respondents (96%) whose companies are using AI for this purpose report that it’s improved their progress on sustainability goals and initiatives,” according to the report. 

The Path Forward: Education and Implementation

While companies that implement AI for sustainability are seeing positive results, widespread confusion remains. Three in four C-suite respondents (75%) believe they can’t achieve sustainability goals without AI, yet 65% aren’t sure how to use it effectively. 

Three in four C-suite respondents (75%) believe they can’t achieve sustainability goals without AI, yet 65% aren’t sure how to use it effectively. 

This suggests a pressing need for more educational opportunities and strategic initiatives to leverage AI in sustainability.

As businesses prepare employees for the future, they will turn to AI to meet sustainability needs. Those who acquire these skills today will be better equipped to create more sustainable, agile, and resilient workplaces in the coming years. 

However, current educational resources on AI and sustainability are insufficient. While 72% of C-suite leaders have undergone training in this area, only 30% of employees report the same, highlighting a significant gap that needs to be addressed.

The integration of AI in sustainability practices truly offers immense potential, but requires concerted efforts in education, training, and strategic implementation to realize its full benefits, as well as contemplation about the environmental impact of AI itself.