- Investors are demanding more detail on ESG reporting ahead of this year’s AGMs
- North American data centers consumed 1 trillion liters of water by 2025
- Current reporting and targets are too vague, they argue
More than a dozen investors are said to be increasing pressure on some of the biggest names in technology to disclose detailed data center water and energy usage ahead of annual shareholder meetings.
New Pakinomist reporting claims that central to the demands is for companies including Amazon, Microsoft and Google to offer site-level transparency instead of high-level metrics to provide better insight into the environmental impacts of their data centers.
This comes amid growing concern over AI’s impact on communities and the environment, with North American data centers alone said to have consumed around one trillion liters of water by 2025.
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Investors want more detailed reporting on data center sustainability
With fears that data centers could strain local water supplies and power grids, many large projects have already been canceled, delayed or moved due to local opposition, which is why investors are demanding not only more detailed impact measurements but long-term strategies.
Currently, there are a number of gaps in reporting, with Google failing to include third-party data centers in its reporting, and Amazon reporting water consumption relative to electricity rather than total consumption. Microsoft also lacks site-level water usage data.
As with each of the three companies, their broader long-term strategies are geared toward positive outcomes, but specific progress is more cryptic in ESG reporting. Most are aiming for the 2030 deadlines to be water positive or CO2 neutral, while many have already hit 100% renewable energy matching to varying degrees.
In terms of where investor demand leaves data center operators in the meantime, it is clear that there is a growing expectation for companies to prove that AI growth will not come at the expense of local communities and the environment.
Going forward, standardized environmental reporting can be introduced for more granular detail, which will ultimately encourage hyperscalers to become even more efficient.
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