OpenX Is Officially Net Zero. Here’s How It Got There

OpenX, one of the ad-tech industry’s biggest supply-side platforms, today announced that it’s reached net zero greenhouse gas emissions after cutting its footprint by 96%.

The company worked with external experts from the Science-Based Targets Initiative, consulting group RSK, independent assessment group LRQA, carbon market solutions firm Climate Impact Partners and nonprofit The Climate Registry—all of which verified OpenX’s net zero status.

Reducing greenhouse gas emissions generated by ad tech is crucial for meeting the targets required to slow climate change as well as the demands of incoming ESG regulations and sustainability-minded supply chain partners. Still, some argue that addressing current operational emissions is merely the first step of many for ad tech, which needs broad buy-in and systemic changes to eliminate the excess emissions created by open auctions and unnecessary queries.

“When we first embarked on this, the goal was to start down the path and really understand how a company can endeavor to be more sustainable,” John Gentry, OpenX CEO, told Adweek.

“As we got further along the path, we realized that we could have a shot at achieving net zero [sooner than expected],” he added. “We’re thrilled that we have.”

Cloud platforms and remote working

In 2018, OpenX began the process of moving to Google’s Cloud Platform, a decision that was informed in part by the emissions savings that the transition would create for the company.

Google’s cloud offering is powered by renewable energies where possible, and the remaining carbon footprint is offset, according to the company. For OpenX, transitioning from data centers to Google’s cloud offered enormous benefits, including cutting about 85% of OpenX’s total carbon emissions from that 2018 baseline.

“Replatforming to the cloud is absolutely huge,” Bill Wescott, managing partner at sustainability consultancy Brain Oxygen, told Adweek. “Energy efficiency and then running on renewables on top of that … that’s where you see the really big delta.”

Next, the Covid-19 pandemic precipitated a shift from in-person office work to a remote-first model. OpenX consolidated from 10 offices to four between 2018 and 2021. With roughly 300 employees, emissions related to work-from-home ballooned—but were still drastically outweighed by the savings from reductions in employee commuting and office electricity. The company also adjusted its employee travel policy to cut back on flight-related emissions.

Wescott began advising OpenX on its transition to net zero in 2021. By spring 2022, it submitted its plans to the Science-Based Targets Initiative (SBTi) to reach net zero greenhouse gas emissions by 2027—a goal that it hit within a year.

Finally, after cutting 96% of its carbon emissions, OpenX worked with Climate Impact Partners to identify high-quality carbon offsets for its remaining emissions, achieving a CarbonNeutral certification in October 2022. That meant opting for the more expensive offsets—roughly $37 per metric ton of carbon versus lower quality offsets that can run as low as $5 per metric ton of carbon, according to Wescott.

“We’re not going to offset ourselves out of the problem,” Wescott said. “It has to be fully focused on actual reductions.”

Beyond net zero

While these operational reductions at the ad exchange level are necessary, some are pushing for structural changes to the ad-tech ecosystem that would result in greater efficiency—and fewer emissions—across the board.

Achieving net zero emissions is “an awesome first step,” said Brian O’Kelley, co-founder and CEO of Scope3. “Every company should find efficient ways to run their servers, find green data centers—and then the hard work begins,” he said. Next, O’Kelley said he’d like to see OpenX eliminate open bidding that creates redundant queries, for example.

OpenX’s announcement is timely, noted Ana Milicevic, principal and co-founder at ad tech consulting firm Sparrow Advisers, especially given the increasing pressure that the private sector is under to disclose emissions data and deliver on ESG commitments.

“I’d expect others to follow suit [within the next 12-18 months],” Milicevic said. “There’s a renewed urgency and opportunity to incorporate positive climate steps into necessary reinvention as we say goodbye to cookies and similar technological glue that helped ad tech get to where it is today.”

Moving forward, OpenX is focused on working with ad industry trade bodies to develop measurement standards for the emissions generated by programmatic advertising—something that groups like Ad Net Zero and the World Federation of Advertisers already have in motion.