Are Businesses Getting Greener?

Looking back, Bob Culver sees the post-Gulf War years as a pivotal time in the way the world engaged in environmental issues.

Simply put, the United States became a nation fueled on gas-guzzling SUVs, while Europe moved to curb its energy consumption. Today, Europe is far ahead of the United States in terms of environmentally friendly policies.

European companies have responded to the regulations: About 60 percent have green strategies in place, versus just over a third of their American counterparts, according to a study by the Cutter Consortium, an IT advisory firm. “We [in the United States] went down the wrong road,” says Culver, senior vice president of Wells Fargo’s technology information group.

Environmentalists could scream from the rooftops, yet the idea of proactively working to heal the environment just wasn’t taking hold in corporate America. But we may look back at 2008 as the year when those businesses started playing an active role in helping the environment: About half of companies have launched–or have announced plans to enact–company-wide green strategies, and nearly the same number have already achieved their goals, according to CIO Insight‘s Green IT study.

The lack of regulatory motivation helped stall the green movement in this country, but past interviews with IT executives and industry experts revealed another reason for America’s allergy to eco-friendliness: financial concerns. If businesses weren’t seeing a return on their investments in green technologies, those initiatives promptly became non-starters.

That, too, seems to be changing, our study finds. When asked about their motivations for launching green strategies,

74 percent of IT executives claim environmental concerns. Following closely behind, though, at 73 percent, is cost savings.

“If you’d asked that question six months ago, the answer clearly would have been cost savings over corporate citizenship,” says Simon Mingay, research firm Gartner’s United Kingdom-based green IT expert. The shift in impetus, he says, has to do with a lowering of the financial bar: Businesses are still looking for a positive (or, at least, neutral) financial return, but that driver is diminishing.

In its place, companies are putting a higher premium on “softer elements,” such as brand value and meeting corporate social responsibility goals. Culver agrees: “Now you can take something that might not have an amazing financial return and get it done because it’s the right thing to do.”

Wells Fargo is one of the companies that have initiated a green strategy. In 2005, the financial giant established a 10-point environmental plan, mandating everything from greening its own operations to financing environmental concerns.

Culver has helped lead the charge, playing a central role in designing two new data centers that use power and cooling technologies expected to save the company millions of dollars over the next few years. Wells Fargo is also working to get LEED certification (Leadership in Energy and Environmental Design rating for environmentally sustainable construction) for many of its data centers and branch offices. “I look at it almost as a necessity now,” Culver says of going green.

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