What’s the real-world environmental cost of trading? The financial markets are powered by technology, but what powers that technology and at what cost? It’s not a question the industry has traditionally asked, but it’s one that can no longer be ignored.
As sustainability disclosures become more embedded in financial regulation and investor due diligence, firms are under pressure to quantify and reduce their environmental footprint – even in areas traditionally seen as intangible, like trading.
Inspired by How Bad Are Bananas? by Mike Berners-Lee – which explores the carbon footprint of everyday activities – the latest event from Sustainable Trading set out to apply that thinking to financial markets.
Hosted in partnership with Equinix, the session explored what it might take to calculate the carbon footprint of a single trade, and why it matters. To tackle this, industry experts from across trading operations, infrastructure and sustainability came together to unpack a deceptively simple question: what is the carbon footprint of a trade?
Held at Equinix’s London offices, the panel was moderated by Eleni Coldrey (Equinix) and featured insights from Chiara Ginty (BTIG), Toby Williams (euNetworks), Orele Pluck (BMO), and Jenni Sellick (Options Technology).
Each offered a unique lens – from data centre strategy and post-trade operations to connectivity, compliance and procurement – creating a joined-up discussion around shared challenges and emerging opportunities.
Mapping the trade lifecycle: from abstraction to action
Before we can measure impact, we need to agree on what exactly we’re measuring.
Unlike a banana or a bottle of milk, a trade is not a tangible object. It’s a complex, multi-stage process. To estimate its carbon footprint, firms must first understand what a trade actually comprises: onboarding, execution, clearing, settlement and ongoing data retention – each with their own infrastructure and emissions profile.
These processes rely on vast, interlinked systems: data centres and the digital ecosystems housed therein, networks, applications, servers, cooling, storage, human labour and third-party supply chains. The scope quickly expands beyond any one firm’s direct operations. Many firms rely on the same vendors, platforms and data centre providers, amplifying both the potential for shared progress and the challenge of attributing emissions accurately.
As one panellist explained, understanding a trade’s footprint means mapping its infrastructure stack in full. That includes not just power usage and broader operational performance in data centres, but the embedded carbon in hardware, the energy intensity of networks and storage, and even the environmental cost of office-based functions and ongoing system support.
From measurement to strategy: making sense of sustainability data
While there is growing awareness of carbon intensity, meaningful measurement remains a work in progress. For most firms, Scope 1 and 2 emissions are relatively well understood. But Scope 3 – the emissions tied to suppliers, vendors and outsourced services – represents the largest and most opaque portion of a firm’s footprint.
Some progress is being made. One participant shared how their firm has introduced project- and service-level carbon reporting to help clients understand the emissions tied to specific technology usage. This has resulted in transparency and accountability to areas previously ignored. These tools are now being integrated into proposals and billing processes, giving clients emissions data alongside commercial quotes.
Better carbon data is not only helping clients make more informed choices, it is also supporting internal change by making sustainability initiatives measurable and reportable at a granular level.
However, standardised measurement remains elusive. Firms spoke of the need to balance accuracy with practicality, often relying on proxies, estimates or third-party frameworks. The message was clear: while perfection is impossible today, progress is not. Better data, even if incomplete, can still inform better decisions.
Aligning incentives: sustainability as a commercial driver
The discussion also highlighted a shift in how sustainability is perceived – not just as a compliance or reputational concern, but as a source of commercial value.
Clients are beginning to ask harder questions of their providers. Requests for ESG credentials now sit alongside RFPs for latency or pricing. Demonstrable sustainability practices are becoming differentiators, and in time, may become prerequisites.
Internally, too, sustainability is proving to be a catalyst for efficiency. Several panellists highlighted how efforts to reduce emissions – such as streamlining post-trade processes or refreshing legacy infrastructure – often yield cost, performance and resiliency benefits as well.
There is also a growing recognition that sustainability choices are strategic, not just operational. Decisions made today about data centre location, procurement policies and technology architecture will shape a firm’s flexibility, competitiveness and license to operate for years to come.
This shift reflects a broader trend in sustainable finance: sustainability is increasingly seen not as a cost centre, but as a driver of long-term value creation.
Regulation, AI and the road ahead
Looking ahead, the panel reflected on the forces likely to shape sustainability in trading infrastructure over the next 12–24 months.
Regulatory expectations are increasing, with clearer frameworks and mandatory disclosures emerging globally. Standardisation in sustainability reporting is also anticipated. What will the impact of these developments be on efficiencies?
Artificial Intelligence also looms large. While AI promises efficiency gains and smarter optimisation, its computational demands are intensifying pressure on power grids and infrastructure. Data centre design and efficiency of operations are crucial in tackling this, and so partnerships in this area need to be carefully considered by financial organisations. The design choices for building materials, cooling systems, power sources – amongst other elements – will greatly determine the long-term environmental performance of any AI deployments within a data centre. The consensus: AI needs to be deployed with care and measured not just by what it can do, but what it costs environmentally.
Meanwhile, the industry continues to move toward shared, more flexible infrastructure. The rise of cloud, co-location and virtual desktop environments is enabling firms to reduce their physical footprint and partner more effectively on sustainability goals. But these shifts require trust, shared standards and coordinated action.
A collective challenge, and opportunity
The session closed with a call to action: sustainability isn’t someone else’s job. Whether you’re a head of operations, a network engineer or a procurement lead, everyone has a role to play in rethinking how the industry works and how it impacts the world around it.
Small steps – like embedding sustainability into procurement criteria, streamlining workflows or understanding Scope 3 impacts – can ripple outward. The work may be complex, but the starting point is simple: ask better questions, share what you learn, and keep challenging the status quo.
As this event made clear, the carbon footprint of a trade is not just a technical calculation. It’s an invitation to rethink how the financial markets operate and how they can evolve toward a more sustainable future.
Final thoughts and what comes next
The conversation around the carbon footprint of a trade is still in its early stages, but this event showed there is an appetite to tackle it. The scale and complexity are real, but so too is the potential for progress. By breaking the problem down into practical components, sharing knowledge across firms and embedding sustainability into everyday decisions, the industry can begin to make measurable change.
Sustainable Trading will continue to explore this theme in partnership with our members; bringing together leaders to co-develop guidance, share methodologies and drive collective action.
If you are interested in shaping this agenda – or have ideas, tools or use cases to share – we would love to hear from you.