Decarbonization: the new transformative paradigm
What if the sustainable revolution accelerated faster than expected? The actions we take to advance the ecological transition transcend politics and regulation. Today, start-ups play a vital role in the ecological transition, and we need more than ever to work together, hand-in-hand, start-ups and large companies. We need innovative, disruptive solutions for climate action. And bringing together the appropriate sustainable business ecosystem can become a competitive advantage.
Nowadays, it appears that revenue growth alone is no longer enough to measure a company's performance.
According to Thomas Husson, VP of analyst firm Forrester, “In the coming years, sustainability will become a top priority for CEOs.” In a recent publication, he argues that “their ability to transform their business is critical to surviving and capitalizing on a new wave of business disruption.”
Today, start-ups play a vital role in the ecological transition, and we need more than ever to work together, hand-in-hand, start-ups and large companies.
At Atos, we confirm this trend: indeed, the strategic focus of our clients on decarbonization topics has increased significantly in recent years. Scaler - made up of 50% of start-ups that offer sustainable transformation solutions – opens up new exchanges on sustainable innovation with our major customers worldwide.
Although the standards of the sustainable economy are not yet established, things are moving fast, and the ratings of ESG (Environmental, Social and Governance) agencies carry more and more weight in the decisions of buyers, investors and employees.
Sustaining the momentum of EU Green Deal
However, to implement innovative decarbonization solutions quickly, teaming up is essential, Innovative partnerships between disruptive start-ups and large enterprises can bring together and orchestrate multi-sided ecosystems where innovations and data are shared through APIs and real-time data services enabled by digital data platforms.
The European Green Deal sets the blueprint for this transformational change. All 27 EU Member States committed to turning the EU into the first climate neutral continent by 2050. This will create new opportunities for innovation, investment and jobs.
It is a well-known fact that start-ups often have a head start when it comes to innovation. The French ecosystem is particularly dynamic, especially since French Tech has gone green. Launched at the end of 2020, the French Tech Green20 program aims to advance 20 areas of ecological transition, ranging from green hydrogen production (Lhyfe) to the production of plastic-free polymer (Lactips). As a correlated effect, new investment funds focusing on start-ups with social or ecological impact are being created.
A business strategy based on sustainable values and innovative decarbonization solutions not only has competitive advantages in terms of commercial offers but also assets for attracting and retaining the best talent.
Accelerating the ecological transition is increasing value creation
A paradigm shift is happening at this moment: it is not only the creation of shareholder value that counts, but also the creation of shared value in people, profit and planet that is needed to create sustainable growth. Shared value creation inspires business leaders and entrepreneurs around the world to do things differently, to radically change the way they do business and think about what role they want to play in our society. Innovation and collaboration amongst diverse stakeholders are key to enable a sustainable transformation.
As for Scaler, half of the 20 start-ups it supports are dedicated to decarbonization, which allows Atos to enrich its existing offers by proposing concrete use cases for customers. Some of the new wave of start-ups came on-board last summer: Circular Computing, which provides certified carbon neutral refurbished laptops, Carbon Minds, a chemical industry lifecycle analysis measurement tool to reduce the environmental impact of this sector, and Woop, a platform for orchestrating last-mile delivery.
From ecosystems toward multi-sided platform business models
Software République, a consortium formed by Atos, Renault, Dassault Systèmes, Orange, Thales, and STMicroelectronics to develop new forms of mobility, pushes the logic of ecosystems even further. Its Mobility 4.0 Challenge awarded its first prize to start-up Wattpark, which allows charging station owners to rent them to electric or hybrid vehicles users. An integral part of this ecosystem is that award-winning start-ups will have privileged access to the R&D capacities of large companies as well as to their customers, possibly to develop their business internationally.
It is in the interest of businesses to bank on this ability to create synergies between different types of players, and to work openly. A strong trend toward multi-sided platform business models should make it possible to accelerate these open ecosystems. Investments by large organizations in these platforms should make it possible to launch all these start-ups in SaaS mode on decarbonization, either in a sector specific logic or even between different sectors. Many start-ups can easily adapt to multiple markets to grow and diversify their solutions.
According to Forrester's report, the revolution has begun, we see a trend emerging that intends to broaden the analysis of shareholder value creation to encompass a wide circle — from employees, suppliers, customers to society at large. Whoever can attract the best talent, the most innovative start-ups, academics, industry associations, etc. and who can operate in a truly open and agile way, will be ideally positioned. This is even more true with a topic as vital as decarbonization.