Telefónica’s CEO, José María Álvarez-Pallete (pictured) explained to Davos how crucial digitalization is and how telecommunications infrastructure can save the planet.

He delivered a speech at the Davos World Economic Forum, where he was on a panel called ‘Unlocking Digital Innovation for Net Zero. In It he said that “green and digital transitions go hand-in-hand” and that “without digitalization there is no green transition”.

The thrust of the message appeared to be that telco infrastructure development and digitisation – the process of upgrading a companies operations with technology – are intrinsically linked to the pursuit of sustainability.

Álvarez-Pallete called for “strong political and regulatory mechanisms to further develop decarbonization plans leveraged on digitalization,” and said that: “It is our collective responsibility to spread the benefits of digitization to all sectors and particularly to SMEs to accelerate the multiplying effect of technology to decarbonizing the economy. If we do it right, it will bring significant benefits to society… there is no energy transition without digitization.”


He went on to say that “smart infrastructure is the backbone of the green transition, a game changer for a net-zero economy”, and claimed that digital technologies and services have the capacity to reduce global emissions between 15% and 35% by 2030.

“We are pioneers in addressing the energy and digital transition,” claimed Álvarez-Pallete. “Sustainability is at the heart of who we are and what we do… At Telefónica we are walking the walk. We have a long track-record decarbonizing our own operations and our value chain and developing smart-technologies. We rank as one of the leading companies in sustainability and as a benchmark in environmental management, including the A list of the CDP for the last eight years.”

It’s not intuitively clear how building out more telco infrastructure, layering thousands of businesses with technology upgrades, and presumably building more servers to accommodate things like increased cloud adoption, is automatically going to drop CO2 emissions across the board, but we’re sure the argument could be made. And in any case, the primary argument for a firm ‘digitalizing’ itself was surely that they’ll become more efficient and profitable businesses, not that they’ll immediately negate their impact on the environment if they start strapping IoT devices to things.

Companies can get very caught up in their own rhetoric sometimes, and while aiming to produce less pollution and waste – which is what sustainability really is – is an admirable aim, it always irks a bit when they would have you believe it is their sole or even primary purpose. If that were the case, shuttering the business would keep you nice and carbon neutral.


Like it or lump it, any public company’s ‘purpose’ is to provide a return on investment for its shareholders. It’s called fiduciary duty and as a CEO you’re not really supposed to do anything other than pursue that. So it’s handy then when lofty grandstanding smoothly transitions into sales opportunities. Phrases like “It is our collective responsibility to spread the benefits of digitization to all sectors” take on a particular significance when it is you who are the one selling the means to do it – and not for the price of a sandwich, either.

Meanwhile; the Telefónica announcement stressed: “It is also essential that telecommunications infrastructures are recognised as sustainable investments by all stakeholders and are adequately represented in the European taxonomy of sustainable activities,” paraphrases the release by Telefónica. Maybe this is a suggestion that comes from nowhere other than an aspiration for a cleaner environment – but it wouldn’t hurt the margins of telcos who build the stuff either, would it?

The use of the term ‘stakeholder’ is core World Economic Forum language. Its vision of stakeholder capitalism involves companies striving towards objectives other than merely profit and growth. While the appeal of such a reprioritization is clear, it’s not so obvious why the unaccountable WEF should be the organisation that leads way on such a paradigm shift. Like it or not, companies are still answerable to their shareholders, who are still likely to seek profit and growth over corporate virtue-signalling.

There are for sure areas where technology can help in environmentalism, and no reasonable person is in favour of ruining the environment. Solutions like the solar and wind energy powered 5G site renewable from Deutsche Telekom and Ericsson, for example, seem like a good idea – and perhaps this is exactly the sort of thing Telefónica is advocating for more of.

But these firms are not doing it out of the goodness of their hearts, it’s their business model to drive adoption of such things. There’s nothing wrong with that either – but it rankles to hear it presented in the tone of Tony Stark rallying the Avengers to swoop in and save the planet from an existential threat.


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