New Sustainability Reporting Requirements Have the Power to Drive Meaningful Change in Advertising

The adtech, advertising, and media industries have the power to meaningfully reduce their environmental footprint and massively influence brands and businesses to follow suit, so new requirements for companies to publicly report them have come at just the right time.

By Joseph Worswick, VP of EMEA & Global Head of Sustainability at OpenX

There’s no denying the emissions that arise out of the adtech, advertising, and media sectors are complex and layered. Together, these industries work with an array of tech companies, data providers, and agencies to connect with audiences. As such, digital advertising impacts the environment at each step of the supply chain, from media buying to capital investments.

According to SeenThis, 1GB of data generated from digital advertising emits approximately 1kg of CO2 emissions — meaning that 40 billion impressions would equal 8,000 tons of CO2, or the same emissions as producing 200 million plastic bags.

New EU directives coming into force in January next year will mean that 50,000 companies in the region will have to report on the environmental impact of their operations. Starting in 2024, 11,000 listed companies will have to comply with the new mandate, gradually expanding over the following two years to cover non-listed companies and SMEs. Despite this, though, some 77% of UK firms have not yet begun preparations for the new reporting requirements.

As an industry, we have the power to effect change by committing to consistent and transparent reporting. It’s a step that some organisations avoid out of fear — worry that the numbers will go up or concern that other organisations will be achieving more. Regardless of the inevitable and normal fluctuations that come with business growth, this critical practice serves as a powerful tool for both internal and external change.

Dedicated Transparency

The first step in reducing emissions is making a commitment to reporting them. By reporting emissions consistently — even when they go up – companies not only become accountable themselves, they encourage accountability across the industry. Even for businesses that aren’t included in the first wave of the new EU regulations, this is a step that must be taken sooner rather than later.

It’s important that carbon emissions fluctuating alongside business growth doesn’t deter organisations from measuring and reporting, because these changes are entirely normal. In a world that is returning to business travel, customer events, and in-person internal meetings, it’s crucial that perfection doesn’t stand in the way of progress.

For example, from 2021 to 2022, OpenX’s emissions grew alongside the company, and we shared this honestly and openly. Even with increased emissions in 2022, OpenX continues to meet and exceed its Net-Zero goals with an approximate 95% reduction compared to the base reporting year of 2018.

When it comes to sustainability, we need to keep two important things in mind: First, perfection is the enemy of progress, and second, there is no finish line to sustainability – we will always strive to make things better. Any gain, no matter how marginal, is a step in the right direction, and multiple marginal gains lead to larger successes in the long term. The industry has a real chance to come together and report emissions and share learnings (whether positive or negative) to help the wider industry get to where it needs to be.

Independent Verification

It’s essential that measurement, reporting and the necessary analysis doesn’t happen in a vacuum. Experienced environmental and climate groups can provide verified data collection and analysis tools, relevant comparison information, and achievable paths forward.

These are great resources for agencies and brands to use when assessing potential partners to verify whether they are being transparent and have their claims backed up by verification.

One of the most widely recognized groups is the Science-Based Targets Initiative (SBTi). SBTi is a global body enabling businesses to set ambitious emissions reductions targets in line with the latest climate science. It is focused on accelerating companies across the world to halve emissions before 2030 and achieve net-zero emissions before 2050.

Accredited external resources are great partners for companies seeking transparency and legitimacy in their emissions reduction efforts. Other internationally recognized solutions-focused climate organisations include Climate Impact Partners and The Climate Registry, a nonprofit organisation that empowers North American organisations as climate leaders through best-in-class programs and services for measuring and reducing carbon emissions.

Replicable Framework

By leveraging this framework, organisations should feel empowered to transform their practices into ones that equip them to grow sustainably.

Commitments to lowering emissions and reducing environmental footprints are certainly commendable, but they aren’t enough. As an industry, we need to be developing the systems that will create real change. The first step in that system is a pledge to embrace the new EU directives and commit to consistent and transparent measuring and reporting. This dedication not only keeps organisations on track, but it also builds trust with partners, clients, nonprofits, governments, and the global population.

The adtech, advertising, and media industries have the power to make a meaningful impact on emissions. If we dedicate ourselves to measuring and reporting, regardless of the fluctuations that are bound to occur over time, we can make sustainable, economical business decisions that push us forward.