The Environmental Impact of Remote Work: What IT Leaders Need to Know

As more companies embrace remote and hybrid work models, IT leaders face new challenges in measuring and reporting their environmental footprint. Environmental, Social, and Governance (ESG) reporting has become increasingly critical, with 76% of surveyed executives stating that ESG is vital to their business strategy. However, about 41% of these executives cite inadequate data as the biggest obstacle to ESG progress¹.

The shift to remote work presents both opportunities and complexities in sustainability reporting. Research shows a significant 54% reduction in greenhouse gas (GHG) emissions for remote workers compared to those with an average five-day-a-week commute². Furthermore, contractors and outsourced staff working from home can help reduce Scope 3 emissions and overall supply chain emissions³.

The Environmental Impact of a Remote Workforce

Recent studies have shown that remote work can have a substantial positive impact on reducing greenhouse gas emissions⁴:  

• Remote workers in the US cut greenhouse gas emissions by up to 54% by not commuting to an office five days a week.  

• Even working remotely one day per week can cut emissions by 2%, while 2 to 4 days of remote work can reduce emissions by up to 29%.

• Companies can save up to $10,600 per employee that works remotely, partly due to reduced energy costs in office spaces.

A recent greenhouse gas (GHG) inventory report developed by WAP Sustainability Consulting for Andela, a fully remote tech company, provides valuable insights:

• By having a fully remote workforce in 2023, we avoided an estimated 365 metric tons of CO² equivalent (MT CO²e) emissions that would have occurred from employee commuting.  

• This is a 68% reduction in emissions year over year and is equivalent to the carbon sequestered by 426 acres of US forests in one year or the emissions saved by recycling 127 tons of waste instead of sending it to landfill.

• By working with Andela’s remote talent our clients saved 1,992 MT CO²e last year.  That is equivalent to GHG emissions avoided by 692 tons of waste recycled instead of landfill or carbon sequestered by 2,326 acres of US forest in one year (3.5 square miles).  

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Measuring the Footprint of Remote Workers

While remote work eliminates commute emissions, it does increase residential energy use as employees work from home. The Andela report, that was developed by WAP Sustainability Consulting demonstrates how companies can estimate and incorporate this into their GHG inventories:

• Employee Commute (Telecommuting) - This falls under Scope 3 emissions. Andela estimated residential energy use for remote work using employee counts and average work-from-home energy data from the International Energy Agency (IEA).

• Data Collection Challenges - The report acknowledges that gathering primary data on actual home energy use is extremely difficult due to privacy concerns and the complexity of an international workforce. Using industry averages and estimates is an acceptable approach.

• Emissions Calculations - Andela used EPA, IPCC, and IEA emission factors for natural gas combustion and electricity consumption to calculate emissions from remote work.

• Assumptions - The analysis assumed 250 working days per year and used averaged energy data to create "World Average" values for locations outside the US, EU, and China.

Key Remote Work Statistics from Andela's Report:

• Due to remote business model and services Andela has no scope 1 (indirect emissions from the generation of purchased energy) or scope 2 emissions (Direct emissions from owned or controlled sources).

• Andela’s total GHG emissions for 2023 at 2,088 MT CO²e. To put this number to context, this is equivalent to the annual emissions of 487 automobiles (gasoline-powered passenger vehicles per year, calculated as per the US EPA equivalencies calculator).  

• The estimated carbon footprint per employee is 6.59 MT CO²e per employee. This number has dropped significantly every year since we went fully remote in 2020.  

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Industry Trends and Insights

The shift towards remote work is likely to continue, with significant implications for corporate sustainability efforts:

• 26% of US households now have at least one person working remotely a minimum of one day per week.

• 16% of US companies are now fully remote, and this number is expected to grow.

• By 2025, it's predicted that up to 36.2 million Americans (14% of the adult population) will be working remotely⁵.

As remote work becomes more prevalent, companies will need to develop more sophisticated methods for measuring and reporting the environmental impact of their distributed workforce. This may involve:

• Developing standardized methodologies for estimating home office energy consumption.

• Implementing tools for employees to track and report their work-from-home energy use.

• Collaborating with utility companies to obtain aggregated, anonymized data on residential energy consumption patterns.

• Investing in energy-efficient home office equipment and providing guidance to employees on reducing their energy consumption.

By accurately measuring and reporting on the environmental impact of remote work, IT leaders can demonstrate the sustainability benefits of distributed work models and contribute to their organization's overall ESG goals.

Sign up for our upcoming webinar with SustainableIT.org taking place August 29 for Insights on Remote Workforce Impacts on IT's Environmental Footprint.

See how Andela can help your company save on carbon emissions with our global, remote talent marketplace. Book a demo.  

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¹ https://newsroom.ibm.com/2023-04-17-New-IBM-Study-Reveals-Inadequate-Data-Hinders-Progress-Against-Environmental,-Social-and-Governance-Goals

² https://www.uscareerinstitute.edu/blog/50-eye-opening-remote-work-statistics-for-2024

^3-5 https://www.uscareerinstitute.edu/blog/50-eye-opening-remote-work-statistics-for-2024