
The global landscape for sustainability legislation and reporting is evolving rapidly, with the EU and UK leading with detailed and expansive regulations. California is setting significant standards in the US, particularly with its focus on greenhouse gas emissions. Worldwide, various countries are either adopting international standards or developing their own regulations to ensure transparency and accountability in corporate sustainability practices. This trend reflects a growing recognition of the importance of sustainability in corporate governance and the need for standardized reporting to drive meaningful progress. But what does it mean for AV?
The short answer is that we have just over four years to collate information about the environmental impact of our solutions, their circularity, and make it available to the supply chain, or we risk falling short of strict procurement criteria. It's like knowing your karaoke performance is up next and you haven’t picked a song yet – better get moving!
Back to legislation. The most widely discussed reporting directive is that of the EU, the corporate sustainability reporting directive (CSRD). Currently, large public interest entities in the EU with at least 500 employees are preparing their reports for FY24. Reporting for FY25 will be for those meeting two of the following: net turnover of 40m euro, more than 250 employees, or a balance sheet total of more than 20m euro. Finally, SMEs listed on a regulated EU market and meeting two of the following criteria: balance sheet of 4m euro or more, net turnover greater than 8m euro, or more than 50 employees, will be required to report on FY26. It’s like playing a game of sustainability bingo – do you have two of the following?
Good for the EU, says the rest of the world, but what does it mean for us? Well, when we get to FY27, the CSRD extends to non-EU organizations with branches or subsidiaries turning over 40m euro or more. Imagine the whole world caught in a giant sustainability group hug – whether you want it or not!
There are similar directives in the UK, such as the Task Force on Climate-related Financial Disclosures (TCFD) and Sustainable Finance Disclosure Regulation (SFDR). In California, we await the Climate Corporate Accountability Act (SB 253) to be implemented in 2026. It’s like a sustainability soap opera, with new episodes of legislation keeping us all on the edge of our seats.
Ultimately, all of these have similar requirements: the disclosure of climate-related risks and opportunities, governance, strategy, risk management, and metrics or targets. For now, companies are busy calculating their direct and indirect greenhouse gas emissions and setting targets to reduce them year on year. At some point, the obvious basics such as less travel, EVs, avoiding single-use items, and migrating to green energy will be exhausted, and organizations will turn their attention to the products they procure and their supply chain partners. In CSRD jargon, we call this “scope 3.” It’s like the final boss level in a video game – just when you think you’re done, there’s more to tackle.
In addition to the legislative requirements, voluntary sustainability disclosure has grown exponentially, with Ecovadis now boasting 2m+ companies screened. Sustainability ratings from assessors like B Corp and Ecovadis are a simple way to evaluate if a company’s ESG policies align with yours. If you delve into the assessment process, you will find sections to evidence how you select suppliers based on sustainability, reward those who meet criteria, and incentivize buyers to select from the identified “green” partners.
So, we know that by 2028, many more organizations will be wanting better information from us (the industry) on what our products are made from and what impact their use will have on emissions reporting. A calculator to compare solutions feels like a simple tool to create, but getting the information can be a gruelling task. It's like trying to bake a cake from scratch without a recipe – possible, but not exactly easy.
Today, we have enough fingers and toes to count the AV manufacturers who “eco-score” their own products, seek third-party certifications or labels such as EPEAT, EU Ecolabel, or Energy Star ratings, or make raw materials and circularity information easily accessible to customers. That is soon to change too…
The EU Green Marketing Directive is a legislative initiative aimed at addressing and regulating green marketing practices within the European Union. Its primary objectives are to combat greenwashing, enhance consumer protection, and promote genuine sustainability efforts among businesses. This will prohibit companies from making false or misleading environmental claims about their products or services and require them to provide credible and verifiable evidence to support any green claims they make. For electronics, we expect a requirement for third-party certifications, life cycle analyses, or other forms of verification. It’s like the EU saying, “Show me the receipts!”
Buyer demand coupled with EU legislation should deliver us a uniform set of metrics to be added to product specification disclosure. From there, all it takes is a calculator to compare systems, something well within the capabilities of an XTEN AV or similar software providers, or a scoring system to rank the environmental impact of one product against another.
What I think is likely is that our buyers’ expectations will peak before our vendor landscape is ready, and so we can assume those manufacturers preparing now will reap the rewards sooner than those who respond only when legally obliged to. It’s like the early bird getting the worm, but in this case, the worm is a sustainable future coupled with business wins!
In the meantime, there is much we can do as users and systems designers to reduce the impact of AV systems, both climate-related and in energy costs. Turning products off (when not in use) is the most effective action, considering content is another. White content displayed on a DvLED display will use more energy than darker colours, with LCD technology animation requires more power than static content. If static content with irregular updates is your use case, consider e-paper displays. Many manufacturers are marketing the percentage of post-consumer materials used in their products, but also consider the ongoing circularity of the product at the end of its life. What percentage of its components and raw materials can be re-used? It's like playing a game of Tetris with resources – fitting pieces together to minimize waste.
In conclusion, sustainability in technology is not just a corporate responsibility or a government mandate; it's like cleaning up after a party—if everyone chips in, it goes a lot faster. From conscious user choices to innovative system design and thoughtful policymaking, every action counts towards creating a greener future. By embracing sustainable practices and fostering a culture of environmental stewardship across the industry, we can harness the power of technology to not only advance human progress but also ensure the well-being of our planet for generations to come.
So long, and thanks for all the fish!
Jenny Hicks
Head of Market Intelligence @ Midwich Group PLC
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@Jenny Hicks I think it is a very good guide to understand what is happening at the regulatory level and a good call to start as soon as possible with a route that takes us along the path of sustainability. I would like to share some data with the Avixa group in Spanish, if you allow it.