Reporting practices of European telecommunications companies on environmental sustainability in the financial year 2023 (No. 528) © Photo Credit: apk - stock.adobe.com

Reporting practices of European telecommunications companies on environmental sustainability in the financial year 2023 (No. 528)

WIK analyzes the sustainability reports of 16 telecommunications companies

Large European telecommunications companies are required to publish sustainability reports since 2018. From the financial year 2024 on, they will have to report in more detail and in a more standardized manner based on the European Sustainability Reporting Standards (ESRS). WIK investigates how the existing scope is applied and analyses differences and similarities. Moreover, telecommunications-specific issues in sustainability reporting are highlighted.

The companies are aiming for “net zero” greenhouse gas emissions in Europe by 2040 at the latest. This target includes Scope 3-emissions in the up- and downstream stages of the value chain which account for a high share of the total emissions (typically more than 80%). Developing targeted measures as well as assessing the related emissions across the complex telecommunication ecosystems represent serious challenges. 

The focus of the measures is on issues related to the consumption of energy. Here, reducing absolute energy consumption is a major challenge for all companies due to the increasing data volumes. Therefore, measures to increase energy efficiency play a central role (such as switch to fibre optics and 5G). 

Circular economy issues have played a comparatively minor role in sustainability reporting so far, but are becoming increasingly important. However, some relevant aspects of the circular economy can only be influenced by telecommunications companies to a limited extent. 

Besides that, telecommunications companies are strongly driving the consideration of environmental effects from avoided emissions through the services used by customers (“enablement”). No common approach to deal with these effects has emerged yet, however.