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Is your data contributing to Global Warming?

Jon AspreyUK insurers are continually pledging new ways to reduce their own environmental impact, promising to reduce emissions to net zero. With societal pressure and government regulations forcing smaller companies to ‘keep up’, any company which is not already looking for ways to cut its carbon footprint and take active steps to meet its own net zero ambitions may already be falling behind. Often overlooked, however, is the environmental impact of excessive and unnecessary data storage.

Insurers are driven by a desire to collect and analyse more data in the belief it can drive better decision making, but often without a clear data strategy to ensure that they are not holding on to more data than necessary. We have witnessed rapid digital transformation in the sector, and the adoption of cutting edge technologies such as Big Data, Cloud Computing, Internet of Things and Artificial Intelligence – all been made possible by enhanced computer processing and storage capabilities – have led to an explosion in the volume of data that is being held. Whilst many ABI members are heavily reliant on high quality and expanding data sets across the breadth of functions, the rate at which data is generated and stored will continue to grow exponentially, whilst at the same time data already held may be redundant, obsolete or trivial and therefore of little value.

Digital world

What is data doing to the Planet?

‘Data is the new oil’ has become a common adage but insignificant consideration is given to the environmental impact of this rapidly expanding resource. Environmental damage has traditionally been associated with industrial enterprises. However, the publicity surrounding cryptocurrencies has raised the public’s awareness about the environmental damage associated with processing data. Storage in large data centres demands high energy consumption with constant electricity, cooling agents and security systems required to keep data secure and online. Based on the most recent scientifically verified information from 2000 to 2005, consumption of electricity in data centres doubled, and from 2005 to 2010 the consumption of electricity in data centres alone increased by 56%.* UK Insurers are increasingly relying on cloud providers, and whilst they are understood to be more energy efficient due to their utilisation of ultra-efficient cooling systems than traditional data centres, this model can actually lead to more data generation when uncapped and low-cost storage packages are offered. Reliance on third parties can also lead to an ‘out of sight, out of mind’ approach in which firms overlook their own responsibilities, similar to the use of carbon offsets, which on their own may not negate the impact of present-day emissions by a firm.

How can Privacy and the Environmental Sustainability Agenda work together?

Privacy and Sustainability are both pressing issues that are receiving increased levels of attention by customers, investors, activists and the wider public. Both are underpinned by an ethical and socially responsible approach to business. Efforts in these areas could be aligned to obtain senior management buy in and raise awareness around supporting firms’ own transition to net zero. Insurance firms seeking to position themselves as socially responsible enterprises should ensure that data is not seen as resource for hoarding. Instead consideration should be given to setting a clear data strategy that aligns the storing and collecting of data to bringing value to the company in a way that is environmentally sustainable. Data strategies in this regard should consider:

  • Accountability: Data discovery efforts to understand how information flows through the organisation can support with identifying data which is unnecessary and should be deleted.
  • Data minimisation: Identifying the minimum amount of data needed to fulfil the purpose and only collecting and holding that much information, rather than collecting everything.
  • Data retention: Only keeping personal data for as long as it is needed by enacting retention policies and procedures and implementing data deletion processes, rather than holding on to everything indefinitely in case it might be useful in the future.


Last updated 05/07/2021