A new report from the NewClimate Institute and Carbon Market Watch suggests that the tech sector is ‘veering off’ its sustainable climate path, despite the industry’s claims.
The 2025 edition of the Corporate Climate Responsibility Monitor (CCRM), evaluates the tech sector based on a number of parameters, including the effectiveness of their sustainable transition, the use of renewable energy to power data centres, efforts to prolong the lifespan of devices, and the use of more recycled components in hardware production.
It suggests systemic flaws in how these companies account for their emissions, and how they’re managing heightened energy demands driven by artificial intelligence.
‘Falling behind’
‘Billions of people around the world use and rely on the technology services and platforms offered by Amazon, Apple, Alphabet (Google and YouTube), Meta (Facebook and Instagram) and Microsoft,’ the NewClimate Institute and Carbon Market Watch said.
‘Yet these household names, despite some efforts and isolated examples of good practice, are all falling behind in the climate stakes. The climate strategies of these tech titans may fail to keep pace with their mushrooming energy demand, propelled largely by the less than smart rollout of artificial intelligence as they race for preeminence.’
Among the key findings of the report are that many tech firms rely on market-based accounting – buying renewable energy certificates that don’t reflect their real, fossil-fuel powered energy use. In turn, it suggests that this process masks actual environmental impact.
The AI boom is also increasing electricity and water consumption, undercutting companies’ stated plans to reduce emissions by the end of the decade.
While Apple, Google, and Microsoft have clearer reduction targets than other firms in the tech sector, they fail to align fully with the Paris Agreement, due to the pressure of AI expansion, the report claims.
Outdated accounting
“The greenhouse emissions targets of these tech giants seem to lean on outdated emissions accounting rules that distort reality,” commented Benja Faecks, a global carbon market expert at Carbon Market Watch, who is involved in the CCRM.
“Standard setters need to mandate rigid accounting systems to make emissions disclosure meaningful, and guide target setting accordingly.” Read more here.
