The dawn of the new AI era has accelerated digital transformation in various industries, touching many aspects of people's lives. As these profound advancements unfold amidst pressing sustainability issues, it is critical to think ahead about the opportunities and risks that AI will bring for the economy, society and environment.
With sustainability becoming an urgent priority, how can AI become a tool for driving progress towards a more sustainable future?
Measuring Sustainability Impacts
As sustainability has become a top consideration for both consumers and investors, companies are exploring new ways to quantify their sustainability efforts and highlight their contributions. Frameworks like Environmental, Social and Governance (ESG) and Sustainable Development Goals (SDG) are being used by popular rating agencies like S&P Global to produce sustainability indices for companies. These help investors benchmark long-term impacts and returns and guide their decision-making.
Amid the growing demand for quantitative sustainability insights, an all-time high of 96% of S&P 500 companies published sustainability reports in 2022, a huge leap from 20% in 2011. However, with the diverse subjective interpretations of what counts, there's an opportunity to refine these metrics.
AI presents a strong potential to advance sustainability measurement, translate sustainability ideas into transparent action, and report on the impact of these initiatives.
How AI Can Accelerate Sustainability Efforts
With its ability to provide better information, in-depth data analysis, and predictive capabilities, AI plays a transformative role in addressing sustainability challenges. It empowers people and organizations to make responsible choices, delivers more accurate predictions to better adapt to climate change, and optimizes sustainability efforts for greater impact.
The United Nations, European Union and World Economic Forum perceive AI as a powerful tool for agile, informed decision-making and scientific breakthroughs. From real-time monitoring of weather events to predicting future energy consumption and carbon dioxide emissions, AI can play a pivotal role in addressing environmental issues.
According to Google and Boston Consulting Group's recent report, AI can potentially mitigate 5-10% of global greenhouse gas emissions by 2030. This is close to PwC UK’s estimate of a 4% AI-enabled reduction in global greenhouse gas emissions, which is equivalent to the combined 2030 annual emissions of Australia, Canada and Japan. On top of its potential environmental impacts, AI's application across agriculture, water, energy, and transport could contribute up to US$5.2 trillion to the global economy in 2030 and create 38.2 million net new jobs.
With AI's ability to analyze large-scale interconnected databases to develop coordinated sustainability initiatives, it can also facilitate the building of smart cities and circular economies that foster efficient resource and energy usage.
Simply put, AI can strike the balance between empowering a productive economy and driving positive environmental outcomes.
The Potential Downsides of Increasing AI Adoption
While AI brings significant improvements to people’s daily lives and helps address sustainability challenges, it is also important to consider potential trade-offs and concerns about its impact on society and the environment.
The EU voices concerns about a possible increase in energy consumption and, consequently, carbon emissions. This is because the research and commercial development of AI technologies require significant computational resources only available through massive data centers.
Policymakers play a key role in countering these adverse environmental impacts by spreading awareness, promoting data sharing, and encouraging private sector cooperation.
As AI development hinges on insights gained through data analytics and resources that may be inaccessible to low- and middle-income countries, there is also growing sentiment about its potential to widen the economic gap.
With AI emerging as a new source of employment opportunities, increased training and development initiatives, as well as making AI technology more accessible in lower income countries, must be considered to drive equality. Governments can build a future-ready workforce by working with corporations to develop or expand AI and climate-related upskilling programs.
Along with the rapid adoption of AI come growing concerns about ethical development and deployment, data security, and privacy. While regulations around AI governance are emerging in different parts of the world, such as the 2023 EU AI Act, which is the first comprehensive human-centered AI legislation in the world, there is room for improvement when it comes to governance around AI. S&P Global expects that 2024 could bring several more regulations globally to ensure effective governance and ethical practices.
The Road to a Sustainable Future Requires Collaborative Effort
The series of industrial revolutions over the last two centuries has led to significant advancements in our society. Today's AI era is no different. However, to maximize AI's potential, avoid pitfalls, and create a sustainable future, collaboration should be at the core of AI adoption.
Scientists, policymakers, business leaders, and the general public should consider knowledge exchange and responsible AI development and usage as a collective responsibility. Wide participation will allow diverse perspectives and voices to shape how AI intersects with climate action and other social initiatives.
In the end, AI is just a tool, and building a sustainable future is only possible if the entire community works hand-in-hand towards a shared vision.
Posted 04 Jul 2024
