Harnessing digital-first thinking to move beyond "net zero" and create a "net positive" impact on the environment

By Youngjin Yoo

The traditional approach to sustainability, focusing on reducing harm and minimizing carbon footprints, is no longer sufficient. As our world confronts unprecedented environmental challenges, we must shift our mindset from simply "doing no harm" to actively contributing to the regeneration of the environment. This ambitious approach requires businesses to become "net positive" agents of change, propelling a regenerative economy that not only sustains itself but also enhances our planet.

Despite the incredible power it has brought to our society, we have yet to see digital technology fully deployed to drive sustainability initiatives. However, as businesses increasingly rely on digital innovation to transform their operations and compete in the marketplace, they have a unique opportunity to leverage technology to advance sustainability goals. There are four different stages of using digital tools to drive sustainability efforts. 

Stage 1: Limited Use of Digital Technology for Sustainability

At this stage, sustainability initiatives are driven primarily by physical means, such as developing advanced filters for smokestacks or creating new biodegradable materials. While these efforts are crucial, they represent a restricted approach to addressing environmental challenges. Imagine a manufacturing company that creates a new biodegradable packaging material to replace its existing plastic packaging. This initiative reduces the company's environmental impact but does not fully leverage the potential of digital technology to drive further sustainability improvements.

Stage 2: Digital Technology for Sensing, Monitoring, and Optimization

In this stage, businesses use digital technology to sense, monitor, and optimize their physical operations, enabling more efficient and effective sustainability efforts. By utilizing tools such as the Internet of Things (IoT) and analytics, companies can better understand and manage their environmental footprint. A logistics company can deploy IoT sensors and analytics software to monitor and optimize its fleet's fuel consumption. Through real-time data analysis, the company identifies inefficiencies, optimizes routing, and reduces overall emissions, while still primarily relying on physical means to achieve sustainability.

Stage 3: Harnessing Network and Learning Effects with Digital Assets

At this level, businesses use digital assets and machine learning algorithms to drive continuous improvements in sustainability. By harnessing the power of data and artificial intelligence, companies create positive network effects among individuals and organizations, ultimately fostering exponential growth in sustainability outcomes. For example, an energy company can employ machine learning algorithms to optimize the performance of its renewable energy installations. The company shares its data and insights with other industry players, creating a network effect that accelerates the adoption of renewable energy and propels the industry towards a more sustainable future.

Stage 4: Pursuing Generative Derivative Effects through Digital Innovation

In the most advanced stage, businesses use digital innovations to generate derivative effects, transforming sustainability outcomes into verifiable digital assets that can be traded for financial gains or leveraged to drive unplanned innovations by external parties. Imagine a financial institution developing a blockchain-based platform to tokenize and trade carbon credits, allowing businesses to buy and sell verified emissions reductions as digital assets. This platform incentivizes sustainability efforts and unlocks new value by enabling market-driven approaches to climate action.

Empower Consumers through Digital-First Sustainability Drives

Companies with an advanced digital-first sustainability strategy can use their sustainability capability to create a competitive advantage. Here, digital technology can enable consumers to make informed decisions when purchasing products or services. By sharing detailed, verifiable information about a product's carbon footprint, companies can help consumers understand the marginal sustainability cost of their consumption. This transparency can drive purchasing decisions and create a powerful feedback loop within the ecosystem.

Imagine a grocery store chain that launches a mobile app that displays the carbon footprint of each product on its shelves, allowing customers to compare the environmental impact of their choices and make more sustainable decisions. The app also offers personalized suggestions for lower-impact alternatives, further driving consumer engagement and fostering sustainable consumption habits.

In order to pursue such a digital-first sustainability strategy, firms must create a digital infrastructure that prioritizes environmental responsibility. The software architecture, cloud infrastructure, and energy sources used to power digital services can all impact the sustainability cost of those services. By optimizing these factors, businesses can ensure that their digital operations are as environmentally friendly as possible.

If all streaming service providers share their energy sources and infrastructure used to deliver their digital content, users of such services can choose service providers based on not only the cost but also their carbon footprint. These firms will discover that by optimizing their software architectures and using more renewable energy sources, they can reduce the sustainability cost of their service. The company then communicates this information to consumers, differentiating itself from competitors and attracting environmentally-conscious customers.


As the world faces mounting environmental challenges, businesses must do more than simply "do no harm." They must actively contribute to the regeneration of the environment by harnessing the power of digital innovation. By leveraging technology at various stages, businesses can move beyond "net zero" and become "net positive" agents of change, driving a regenerative economy that sustains itself and improves our planet.

Empowering consumers with digital-first sustainability drives and building a sustainable digital infrastructure are essential steps in this journey. By embracing digital technology in their sustainability efforts, businesses have the potential to create lasting, meaningful change. It is not enough to simply reduce our environmental impact; we must strive to create a world that not only sustains itself but actively works to repair and regenerate the environment for future generations.