The definition of a successful company has changed as a result of the shift from shareholder capitalism to stakeholder capitalism, Ericsson Head of Sustainability Bhushan Joshi said during a panel at Mobile World Congress Las Vegas 2022.

Nowadays, companies are integrating sustainability into their operations because it can deliver bottom line impacts in the form of financial, social, and economic results. These results affect large enterprises stakeholders, which include local communities and the public in addition to investors and shareholders.

Joshi explained that Ericsson is focused on developing a 5G portfolio that's "more and more energy efficient," which is "a source of competitive advantage for us, definitely."

But beyond that, he said the vendor's efforts to lower energy use are "also a win-win-win situation because now we have our customers [and] network operators able to run their networks with lower power consumption, which helps them achieve their goals, but it also drives toward their sustainability targets as well."

The operator's commitment to sustainability hinges on "investing in developing products that are energy efficient [and] making sure that our supply chains are more energy efficient," he said. Ericsson also "take[s] carbon out of our supply chains," which is instrumental in reaching its own net-zero objective.

But modern business success must also be defined through a social lens, Joshi noted. "Closing the digital divide is arguably the biggest social impact that our sector can drive," he said. "It's a very difficult challenge that requires the whole sector to collaborate."

Despite the tall order of providing connectivity in vast unconnected areas, it's a crucial mission. Connectivity is powerful and promises to change lives, Joshi said, citing Ericsson research that found just a 10% increase in mobile broadband adoption drives a 0.8% increase in gross domestic product (GDP).

Deutsche Telekom SVP of Technology and Innovation Arash Ashouriha echoed Joshi's theme that business success is tied to environmental impact. "As business leaders, we have a sustainability responsibility," Ashouriha said during the panel discussion.

"The way we approach [sustainability] is for the whole company to be very consistent," he said, adding that DT's executives and board members all have sustainability goals tied to their financial compensation.

DT's role in climate change – similar to other telcos' – is complex. On the one hand, reducing the fossil fuel- based power its networks consume will lower the operator's carbon footprint and the footprint of customers who use DT's network, Ashouriha said.

But that principle also functions the same in reverse. "Customers are choosing very careful which company to work with," he noted.

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