St. Paul-based Travelers' announcement this week that it is pledging to reduce total U.S. greenhouse gas emissions by seven percent by 2011 is another example of how high-profile topics such as green computing, sustainability and energy efficiency have become in financial services.Travelers' initiative stems from the company's participation in Climate Leaders, the U.S. Environmental Protection Agency's (EPA) industry-government partnership that works with companies to develop comprehensive climate change strategies.
Not to detract in any way from Travelers' goals or climate change-addressing activities to date -- but it's gotten so that I'm seeing announcements of this nature from insurance companies and banks almost every day. Yes, there's a lot hype and "happy talk," but as I have noted before, the issues of climate change and environmental risk are real and so are the potential business benefits for insurers that start to address these issues in a meaningful way.
I will go so far as to predict that 2008 will be "The Year of Green" in insurance and financial services IT. Reducing carbon footprints and addressing sustainability won't necessarily replace any of the other urgent topics of discussion and analysis, such legacy systems, customer experience, recruiting and retaining IT talent, and risk management/regulatory compliance. But these new concerns will move towards the top of senior executives' agendas.
In fact, I think discussions of and actions on all these long-standing high-priority challenges actually will incorporate sustainability-related concerns -- the green computing angle might actually be a way to make a stronger business case and seal the deal. For example, CIOs still trying to persuade doubters about legacy transformation strategies can make the argument that moving to a more efficient platform also will position their companies as leaders in addressing sustainability. Carriers that are struggling to renew their IT workforces with new, younger blood have a better chance of attracting Millennials by being on the right side of dealing with climate change. Sooner or later (after the 2008 presidential elections?) there will be tougher regulatory requirements related to businesses' and consumers' carbon outputs -- why not get a head start on compliance? As always, the real test will be to go beyond rhetoric, hype and PR, and to contribute to actual measurable results -- both for the environment and the bottom line.
Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio