5 minute read
Electronics industry: Going green
Tackling the scourge of e-waste
A ‘green’ electronics industry is a win-win solution as it will curb environmental pollution while helping companies to attract more buyers and boost their profits.
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BY NIKHAAR GOGNA
Electronics have become ubiquitous to life these days. The National Family Health Survey 5 (2019-21) states that 68% households in the country own a TV, while there are 18% households with a washing machine, 38% with refrigerators and 24% with ACs.
While it is impressive to see the growing consumption of consumer electronics in the country, another storm is silently brewing, which merits our attention. This is the menace of electronic waste or e-waste, i.e., an electric device that is discarded, becomes obsolete, or breaks down. According to the Central Pollution Control Board, e-waste in the country rose 31% from 7.71 lakh tonnes in 2018-19 to 10.14 lakh tonnes in 2019-20. Further, the Global E-waste Monitor 2020 found that in 2019, India (3.2 mt) was the third largest contributor to global e-waste, after China (10.1 mt) & the USA (6.9 mt).
TIME TO REBOOT
It is widely recognized that e-waste is not only a major environmental pollutant, raising concerns about air, water and soil contamination but it is also a major reason for health hazards. Substances such as mercury and lead damage the human brain and/or coordination system. To make things worse, much of today’s electronics contain data storage, which could be accessed after the item has been discarded and exploited by nefarious parties. Given the global clamour about climate change & concerns around human health, it is high time for the electronics industry to rethink its ways of operation & incorporate sustainability into its business model. Some approaches that can be applied are as follows:
Ensuring endurance
Manufacturers need to stay away from the practice of planned obsolescence & ensure greater shelf life for the product. Not only will this approach help the brand build loyalty among customers, but brands can also generate higher revenues by offering resale and repair, despite fewer sales.
Circular supply chain
E-waste has several precious, critical, and other non-critical metals (estimated value at approximately US$ 57 billion) that can be used as secondary materials after recycling. Using recycled metals is profitable for companies too. According to Toxics Link, 5 tonnes of e-waste from 83 computers would give profit worth of ` 1,78,308 through recycling.
Changing customer perception
Companies need to educate customers that products from reused substances are not inferior. They can use promotional strategies such as heavy discounts on exchange of old gadgets or selling refurbished devices at competitive prices. Governments can also disincentivise customers from buying first hand products with policies like “pay as you throw” (consumers pay a fee based on the amount of waste they present for collection).
Carbon trading
Last, but not the least, companies
also have the option of buying certificates that someone else is reducing emissions on their behalf. While this will still keep a tab on carbon emissions, this is similar to the concept of greenwashing, as buyers will source voluntary carbon credits against the total emission done by them instead of actually taking steps to cut down carbon emission in the value chain. Another issue pointed out by Shailendra Singh Rao, founder of Creduce, with this strategy is, “Carbon credit has no fixed pricing mechanism and has no fixed process by which pricing can be done in the international market. Carbon credits, moreover, are the subject matter of bilateral trading”.
THE BALANCING ACT
The government aspires to transform India into a US$ 300 billion electronics manufacturing powerhouse from the current US$ 75 billion by 2026. This vision for the Indian electronics industry is in line with its Aatma Nirbhar Bharat initiative. It is taking measures such as enacting US$ 10 billion PLI Scheme for the semiconductor and display ecosystem to ensure that the country is a part of the global electronics value chain.
At the same time, a sustainable business model is the need of the hour amidst soaring temperatures & pollution. The global green technology and sustainability market was estimated at US$ 11.49 billion in 2021. It is expected to grow from US$ 13.76 billion in 2022 to $51.09 billion by 2029, at a CAGR of 20.6% according to Fortune Business Insights. Innovators from across the world are expected to bring in new innovations, backed by zealous VCs, to ensure catalytic growth in this market. Total investments in green technologies reached US$ 755 billion in 2021, growing by 25% YoY, according to BloombergNEF.
Explaining the importance of circularity, Tim Cook, CEO of Apple said, “Every company should be a part of the fight against climate change”. Given that around two-
Global e-waste generation projection
55.5 57.4 59.4 61.3 63.3 65.3 67.2 69.2 72.9 71.1 74.7
Source: Global E-waste Monitor 2020 (all values are in mt)
thirds of consumers across six international markets believe they have a responsibility to purchase products that are good for the environment and society according to the Harvard Business Review, sustainability is a win-win solution. This is attributed to the fact that it will not only curb environmental pollution & check global warming, it will also help companies attract more buyers, save costs & gain a positive brand recognition.
To illustrate this point, according to Daily Mail, Apple has saved over US$ 6 billion by not providing chargers in iPhone boxes. Not only did it save money by not producing chargers, it also saved money in packaging & shipping smaller boxes. Similarly, Intel achieved a 90% non-hazardous waste recycle rate by 2020 & recorded cumulative energy savings of 4 billion kWh from 2012 to 2020. HP has also adopted sustainable measures such as recycled plastic, third party certified recycled corrugated for packaging & reducing the amount of materials in the PC by weight. The brand has reported US$ 3.5 billion in sales associated with sustainability in the last three years.
To sum up, a green electronics industry is the way forward. Business & Sustainable Development Commission also emphasizes on this point. It predicts that sustainable business models related to the SDGs could open economic opportunities worth up to US$ 12 trillion and increase employment by up to 380 million jobs by 2030.
