Xiaomi Pledges Carbon Neutrality with 100% Renewable Energy Utilization by 2040

Consumer Discretionary Author: Yiru Qian Sep 06, 2023 03:20 PM (GMT+8)

As a global top 3 smartphone company and leading consumer AIoT platform, Xiaomi is fully committed to leveraging its scale and efficiency to drive a more sustainable economy

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Chinese smartphone maker Xiaomi (1810:HK) recently released the earnings report for the second quarter and six months ended June 30, 2023, recording a total revenue of CNY 67.35 billion (USD 9.24 billion) and an adjusted net profit of CNY 5.1 billion, up 147% YoY.

With the proliferating profit, the tech giant also ambitiously made its commitment in its interim report to achieve carbon neutrality in the operations of its existing businesses along with 100% renewable energy utilization by 2040. This marks a significant step forward following Xiaomi's 2022 ESG Report, in which they stated their goal to reduce green house gas (GHG) emissions from their main operations to 2% or less from the base year level by no later than 2040, effectively achieving net-zero emissions.

In 2022, the International Telecommunication Union (ITU) took significant strides within the realm of sustainability, introducing industry-specific standards for the Information and Communication Technology (ICT) sector. These standards have been formulated with the primary objective of aligning the ICT industry with the climate objectives outlined in the Paris Agreement, with a particular focus on temperature control. These regulations stipulate that the ICT sector is obliged to curtail its greenhouse gas emissions by a substantial 45% during the pivotal period spanning from 2020 to 2030.

Climate change has become a critical challenge for human society. Faced with increasingly severe climatic issues, corporate citizens are taking proactive actions to reduce carbon emissions for sustainable development.

Beyond Xiaomi, several prominent players in the telecommunications and electronics manufacturing arena have earnestly embarked on emissions mitigation journeys of their own.

Apple (AAPL:NASDAQ), for instance, has set forth exceptionally ambitious carbon neutrality targets, underpinning its commitment to achieving complete carbon neutrality across its supply chain and product portfolio by the year 2030. This encompasses the inclusion of ancillary emissions, known as Scope 3 emissions, within the overarching purview of their reduction efforts.

Concurrently, companies such as OPPO and Samsung have similarly pledged to reach carbon neutrality or attain net-zero emissions status by the calendar year 2050. Huawei, Vivo, and other noteworthy industry players have also unveiled comprehensive and strategic emissions reduction initiatives, further underlining the sector's collective commitment to sustainability.

Xiaomi also plans to release its Carbon Neutralization Action Report by the end of 2023 to disclose further details of its climate strategies and carbon-neutral roadmaps, according to the interim report.