Semiconductors are in high demand, and manufacturers are under pressure to keep pace with rising demand while lowering their environmental impact. This year’s market growth has been around 17 percent. However, as the semiconductor business expands, so does its carbon footprint and use of resources.

The carbon emissions of several semiconductor manufacturers have surpassed those of leading automakers. This is significant because the automobile industry has a well-known large carbon footprint.

Furthermore, the fabrication of semiconductors is resource-intensive. Fabricating a single 2g chip consumes 32kg of water, 1.6kg of oil, and 72g of chemicals – and billions of chips are manufactured every year.

This impact may be reduced by carbon-reduction efforts.

The semiconductor sector must take immediate action to decrease its carbon impact. Many of the world’s most important semiconductor firms have already made long-term sustainability commitments (2030 and 2050).

Intel and TSMC are among the 100 most sustainable companies named by Corporate Knights in 2022. Some semiconductor firms have joined the RE100, promising to obtain all of their worldwide power consumption from renewable sources. Some are focusing on initiatives that reduce energy usage, water use, and waste production.

Semiconductor firms that implement carbon-reduction strategies also become more appealing to stock investors, among other benefits.
The semiconductor industry is capital-intensive, and it needs enormous investments to stay competitive. Venture capitalists (VCs) recognize the worth of investing in the sector—they plan to invest more than $6 billion in semiconductor firms in 2022.

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Semiconductor firms may also take advantage of the lessons learned by many organizations outside the semiconductor industry when it comes to sustainability initiatives:

Green operations increase a firm’s bottom line. Companies that prioritize environmental, social, and corporate governance (high ESG) goals are more profitable and generate greater value creation in the form of cost savings (e.g., lower energy consumption) and improved investment and asset optimization (e.g., more sustainable factories and equipment) than those that don’t.

Semiconductor companies are complying with global sustainability objectives such as the Paris Agreement and UN Sustainable Development Goals (SDG) as part of their efforts to achieve long-term success. They’re achieving SDG targets, for example, by conserving energy and water, reducing emissions, and more.

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