Tech companies must address impact on natural resources, failure threatens firms long term resilience: WEF

A new report from the World Economic Forum (WEF) emphasizes the urgent need for global technology companies to confront their environmental impact and reliance on natural resources. Without addressing these issues, the long-term viability of these firms could be at serious risk. Technology is now deeply embedded in our daily lives, with over a trillion semiconductors sold annually for use in smartphones, vehicles, and other modern devices. The number of operational data centers worldwide has surpassed 11,000, and the sector is poised for continued growth due to advancements in artificial intelligence, cloud computing, high-performance electronics, and quantum computing. However, this growth is accompanied by significant environmental costs. The semiconductor manufacturing process alone utilizes over one trillion liters of freshwater each year, in addition to substantial amounts of metals and essential minerals. Furthermore, data centers consume over 60 gigawatts of energy—comparable to the peak power demands of California. Alarmingly, around 60 billion kilograms of electronic waste are generated annually, with less than 25% being recycled. The WEF warns that neglecting these environmental challenges could jeopardize the technology sector's operational license and its long-term sustainability. The report highlights that since May 2024, projects worth $64 billion related to data centers in the U.S. have faced delays or cancellations primarily due to local concerns about resource demands and energy consumption. To turn this situation around, the report advocates for tech companies to adopt nature-positive strategies, which can offer financial benefits such as metal recovery for new products and cost savings through reduced energy and water consumption. Key action areas recommended for companies include enhancing resilient and restorative water usage, mitigating pollution through circular practices, and addressing greenhouse gas emissions. Additionally, the report calls for a commitment to land stewardship, sustainable energy practices, and proactive engagement with supply chains. This approach aims to support evidence-based policymaking through transparency and responsible management within the value chain.