78% of top enterprises say IT drives climate goals: Why AI is becoming the engine of sustainability strategy

In a sharp shift from traditional ESG reporting, a new global study by Kyndryl and Microsoft finds that 78 percent of sustainability-leading enterprises now view IT as the core enabler of environmental progress. These digitally mature organizations are no longer treating sustainability as an isolated reporting function. Instead, they are embedding climate goals directly into their operational frameworks, powered by artificial intelligence and trusted data ecosystems.

The 2025 Global Sustainability Barometer Study, conducted by independent research firm Ecosystm, surveyed 1,286 enterprise leaders across 20 countries and nine major industries. The findings confirm that integration-focused enterprises, those aligning sustainability with innovation and digital transformation, are not just outperforming peers on ESG metrics, but also generating stronger financial returns and long-term competitiveness.

Kyndryl and Microsoft, two firms deeply invested in cloud modernization and AI infrastructure, say this year’s data signals a new phase in enterprise transformation. Environmental action, they argue, has evolved into an operational capability. And the infrastructure powering it is increasingly digital.

How is AI transforming sustainability from a compliance goal into a real-time business capability?

One of the most powerful insights from the study is that agentic AI is being used not just to track sustainability metrics, but to act on them in real time. Nearly one-third of surveyed organizations are already piloting or deploying agentic AI technologies. These tools are designed to autonomously respond to changing operational conditions, enabling enterprises to meet carbon goals, optimize energy use, and adapt to climate risks dynamically.

Agentic AI represents a major evolution from traditional analytics and dashboard reporting. Instead of passively presenting data for human review, these systems integrate with infrastructure to make autonomous decisions, such as balancing energy loads, rerouting supply chains, or adjusting equipment settings to reduce emissions.

Faith Taylor, Senior Vice President of Global Citizenship and Sustainability at Kyndryl, said that organizations are moving from policy-centric ESG frameworks to performance-oriented sustainability operations. According to her, this shift means that technology teams are no longer on the sidelines of climate strategy. They are in the driver’s seat, orchestrating real-time action using AI and digital intelligence.

What are the financial benefits for companies that integrate sustainability with IT?

The report finds that 59 percent of organizations globally are now realizing financial gains from sustainability investments. These include improved operational efficiency, increased customer retention, and entry into new markets that favor environmentally responsible businesses. Organizations that tightly integrate sustainability with innovation and resilience strategies reported better margins, faster product cycles, and stronger competitive positioning.

Among integration-focused firms, 62 percent embed sustainability into their core business strategy, compared to only 34 percent among less digitally mature organizations. These leading enterprises are using ESG initiatives as a lever to de-risk operations, accelerate time to market, and differentiate themselves in sectors where customer and investor scrutiny is high.

Ricardo Davila, General Manager of Enterprise Partner Solutions at Microsoft, emphasized that the most successful companies are not treating sustainability as a separate initiative. They are embedding environmental intelligence directly into the systems that govern procurement, manufacturing, logistics, and workforce planning. This makes sustainability measurable, repeatable, and directly linked to return on investment.

Which industries are leading the charge in AI-powered sustainability implementation?

The 2025 Global Sustainability Barometer points to strong momentum in three sectors: energy and utilities, financial services, and transportation. These industries are among the most resource-intensive and are under increasing pressure to decarbonize operations while maintaining reliability and profitability.

In the energy sector, predictive AI is being used to optimize grid performance, forecast demand spikes, and reduce peak-load emissions. In banking, AI is helping institutions quantify climate risk exposure and develop ESG-compliant products. In transportation and logistics, route optimization algorithms are slashing fuel use and emissions by adapting to real-time traffic and weather data.

The study also notes that Europe is leading globally in aligning digital modernization with sustainability, driven by stringent regulatory frameworks and a strong culture of environmental accountability. In Asia-Pacific and the Americas, the acceleration is more ROI-driven, with companies citing clearer financial benefits and market competitiveness as their primary motivators.

Why are IT teams increasingly taking the lead on sustainability initiatives?

According to the study, 56 percent of IT teams are now leading sustainability initiatives beyond the boundaries of traditional tech infrastructure, up from 38 percent in 2024. This is a clear signal that sustainability has become an enterprise-wide priority, and not just a reporting line under corporate affairs or CSR.

Kyndryl’s Taylor explained that cross-functional collaboration is now essential to scaling ESG outcomes. IT and sustainability teams are co-owning digital transformation mandates that are built around environmental KPIs. This includes integrating ESG data into enterprise resource planning systems, enabling AI-powered sustainability simulations, and creating digital twins of infrastructure assets for better forecasting.

The study found that 73 percent of organizations with strong alignment between IT and sustainability teams are achieving faster, more measurable results. This alignment has become the hallmark of high-performing ESG programs, enabling organizations to translate strategy into execution without organizational silos slowing progress.

How does this data reflect broader digital transformation trends for 2025?

The study’s findings align closely with the Kyndryl Readiness Report, which noted that 27 percent of enterprises investing in IT modernization are achieving measurable sustainability outcomes. These include reduced energy consumption, improved regulatory compliance, and enhanced innovation pipelines linked to green product design.

Importantly, 22 percent of digital transformation leaders now cite sustainability as a key success metric, which is a figure that underscores how boardroom perspectives on ESG have shifted. Where once sustainability reporting was seen as a regulatory obligation, it is now part of broader strategic planning tied to investor expectations, brand equity, and long-term valuation.

Sash Mukherjee, Vice President of Industry Insights at Ecosystm, said predictive and agentic AI are creating a feedback loop that allows insight to be turned into action at scale. This is allowing enterprises to bridge the long-standing gap between climate strategy and daily operations, which has historically slowed ESG progress.

What should enterprise buyers and investors expect from this AI–sustainability convergence?

For technology vendors, system integrators, and enterprise buyers, the Kyndryl–Microsoft study suggests that demand will grow rapidly for platforms that integrate ESG, IT, and AI into a single operational fabric. This includes AI-powered sustainability management systems, data governance tools, and industry-specific automation frameworks.

Investors, meanwhile, will increasingly scrutinize how sustainability initiatives affect core performance metrics such as margins, risk exposure, and market expansion. Enterprises that can directly tie ESG outcomes to financial performance may gain a visibility premium, particularly in capital-intensive sectors or those subject to carbon regulation.

The takeaway is clear: sustainability is becoming a programmable business capability, and AI-powered IT infrastructure is the execution layer. Organizations that move quickly to align technology with environmental goals are likely to enjoy not only reputational upside but operational and financial resilience.

Key takeaways from the Kyndryl and Microsoft sustainability study

• Seventy eight percent of sustainability-leading enterprises identify IT as the primary driver of environmental progress, signalling a major shift in how climate goals are executed.

• Fifty six percent of IT teams now lead sustainability initiatives across the organisation, compared to thirty eight percent a year earlier.

• Nearly one third of surveyed enterprises are piloting or deploying agentic AI to turn sustainability insights into real-time operational action.

• Fifty nine percent of global organisations are reporting financial benefits from sustainability-linked technology investments, including lower operating costs and stronger market positioning.

• Integration-focused enterprises are embedding sustainability into innovation and resilience strategies at nearly double the rate of less digitally mature peers.

• Energy, financial services and transportation are the fastest-maturing sectors in AI-enabled sustainability, driven by regulatory pressure and emissions intensity.

• Europe continues to lead the world in ESG technology adoption, while Asia Pacific and the Americas show rapid, ROI-fuelled acceleration.

• Seventy three percent of digitally mature organisations report strong alignment between IT and sustainability teams, which correlates directly with faster progress and measurable impact.

Predictive and agentic AI tools are enabling organisations to close the long-standing gap between ESG strategy and day-to-day operations.

Investors and ecosystem partners are increasingly evaluating sustainability performance as a contributor to financial resilience and competitive advantage.