As sustainability rapidly shifts from voluntary to mandatory, scrutiny is also broadening out from large corporations to startups and small businesses. As global awareness of environmental, social and governance (ESG), requirements increases, stakeholders now expect sustainability to be an active practice within organisations of all sizes.
For startups, sustainability now directly influences a business’ reputation, operational efficiency and overall competitive positioning. Startups that integrate sustainability into their operational model early on demonstrate ESG, which can give them a competitive advantage over others that don’t.
Regulation is tightening
Pressure from Australian regulators and consumers now places a greater weight on environmental responsibility, influencing how businesses are evaluated and trusted. Major organisations pass down their net-zero commitments through supply chains, requiring smaller businesses to also adopt low-carbon practices and provide transparent sustainability data to the public.
Australia’s climate-related disclosure laws are expanding, changing how environmental performance is evaluated and includes emissions measurement. As a result, organisations are going to be increasingly expected to quantify emissions and disclose their performance publicly.
Transparent sustainability data
The inability to provide transparent sustainability data puts startups at risk from being excluded from commercial opportunities.
The need for transparency is also heightened by the growing conversation around the environmental impact of digital infrastructure, especially with the boom of AI. Digital ecosystems account for a big portion of global emissions due to the energy use of data centres.
Startups adopting AI tools and expanding their cloud usage will need transparency on the technologies they use, how they work, and the environmental cost behind them. This makes partnership with responsible cloud providers very important.
Technology that supports environmental responsibility
Choosing technology that actively supports sustainability is becoming a critical lever for startups looking to reduce their carbon impact and meet rising expectations from customers, investors and regulators.
Infrastructure decisions made early can meaningfully influence a company’s environmental footprint as it scales.
Some modern data centre designs already demonstrate what lower‑impact cloud infrastructure can look like in practice. In Sydney, for example, some newer facilities can draw more than 90% of their power from renewable sources and use highly efficient cooling systems that consume a fraction of the water typically required across the industry. These engineering choices materially reduce the emissions associated with data storage and compute‑heavy workloads, including AI.
As businesses continue to digitise, energy consumption from cloud services, AI models and data storage becomes a measurable component of overall environmental impact. Yet many startups lack straightforward ways to quantify this footprint or track progress over time without introducing significant complexity.
Increasingly, infrastructure providers are addressing this gap by offering transparent carbon measurement tools grounded in recognised methodologies such as Environmental Impact Tracker. By accounting for emissions across the full lifecycle of a server, from manufacturing through to operation in data centres, and aligning calculations with established greenhouse gas protocols, these tools make it easier for growing companies to understand, report and improve their environmental performance.
Practical steps to take today
By gathering these insights, startups can get a clear understanding of the true environmental cost of their digital operations. Once businesses can see where their emissions are generated, they are better equipped to make informed decisions about how to improve infrastructure decisions. This visibility reinforces that carbon transparency is not just a reporting requirement, but a strategic advantage.
Embedding sustainability into core operations enables startups to integrate long term planning in their business model. Cloud services with built-in measurement capabilities help startups automate emissions data collection and reporting while improving accuracy. Decisions about where data is processed, how infrastructure is powered, and which AI models operate efficiently are key to building a trustworthy, credible and scalable business.
Contriubuted by Satyam Santosh, Startups Program Lead APAC, OVHcloud