In our last blog post, we looked at the ambitious goals of "Net-Zero Supply Chain Management" and discussed solutions that support companies on their path to climate neutrality. In the next step, we would now like to turn our attention to "SAP Sustainability Footprint Management": With this tool, companies decarbonize their value chain step by step by anchoring sustainability throughout their business processes and exploiting the development potential for sustainable products and services. In this way, you can serve the increasing importance of ecological aspects as a sales argument, which was also addressed in a recent study(1). According to this study, sustainability is advancing from a "nice-to-have" to a "must-have".
SAP Sustainability Footprint Management is a cloud application integrated into the SAP Business Technology Platform. It can be used to determine a company's CO2 emissions in detail. The resulting transparency helps to identify starting points for a more climate-friendly design of the entire supply chain, to optimize processes and to save costs.
SAP Sustainability Footprint Management makes it easier to gain analytical insights into the CO2 emissions of products and processes. Business processes can be successively decarbonized or made significantly more environmentally friendly. Mandatory statutory reporting can be automated, faster, more meaningful and verifiable.
Net Zero's primary strategies on the road to climate neutrality are:
- The binding definition of desired CO2 savings within specific time frames
- The creation of a reliable database as a basis for recording avoidable emissions
- A holistically sustainable design of the supply chain.
Options for analysis and automated reporting
SAP Sustainability Footprint Management is part of the SAP Cloud for Sustainable Enterprises. The cloud application, which is operated on the SAP Business Technology Platform, consistently addresses not only zero emissions but also a seamless circular economy ("zero waste") and "zero inequality" in connection with social and societal responsibility.
The SAP Sustainability Control Tower (SCT) is available to achieve holistic management and reliable reporting in accordance with ESG criteria (environment, social, governance): it offers a variety of valuable data analysis tools and dashboards for recording, evaluating and tracking relevant key figures and enables automated reporting. Among other things, the application accesses material master and transaction data that is mapped in SAP S/4HANA, any ERP system or other SAP solutions currently in use, such as SAP EWM and/or SAP TM.
In addition, the Sustainability Control Tower can be used to track measures already initiated for greater sustainability and carry out "what-if" simulations or impact analyses along the entire value chain. The results obtained significantly increase planning reliability for follow-up initiatives. Their progress can also be tracked via SCT.
Holistic view - from procurement to recycling
SAP Sustainability Footprint Management provides an overview of all energy flows and CO2 generators that occur in the respective business processes, making it easy to identify sources of emissions. This enables companies to quickly gain an overview of their entire CO2 footprint. The overview is based on existing business data and on supplier and partner data that is also integrated into the software. This ensures that all information is taken into account: Whether raw material extraction, procurement, production, recovery or transportation.
Another benefit of SAP Footprint Management is the ability to evaluate alternative materials and production processes. This makes it possible to optimize processes and make your own product range more environmentally friendly in order to meet your own and global sustainability goals.
Functional scope of SAP Sustainability Footprint Management
In a nutshell, SAP Sustainability Footprint Management comprises the following functions:
- Integration with business systems such as SAP S/4HANA or any ERP systems via APIs (Application Programming Interfaces)
- Import and allocation of emissions data from sources such as suppliers and/or industry averages from life cycle analyses
- Graphically supported calculation of CO2 footprints and modeling of energy flows for each product
- Analysis of CO2 footprints based on complete transparency across the entire company and using various dashboards
- Analysis of CO2 footprints in the transportation sector
How does transactional carbon accounting work?
If you want to go one step further and intend to additionally decarbonize your entire value chain (according to Scope 1 to 3 based on real business transactions), a "Green Ledger" included in SAP S/4HANA is a good option: This application generates actual data from average values as the basis for a meaningful, transactional carbon footprint.
It compares emissions and financial data so that, in addition to reporting as part of sustainability or ESG reports, even far-reaching decisions to decarbonize individual areas of the company and/or selectively along the supply chain can be traced transparently .
What does EHS Management do in addition?
Like SAP Sustainability Footprint Management, EHS Management (Environment, Health and Safety) is also part of the SAP Business Technology Platform "SAP Cloud for Sustainable Enterprises". EHS Management can be used to manage supplementary factors such as occupational health and safety and waste generation using various modules. This is done using real-time information.
All compliance requirements are covered by the integrated environmental, occupational health and safety management. This allows a company's sustainability performance to be successively improved. At the same time, the risk of wrong decisions is reduced. The process is particularly advantageous in the transport and logistics sector.
Conclusion and outlook
"Record, report, act": This is the guiding principle behind SAP Sustainability Footprint Management. Not only does it provide a comprehensive overview of all emissions caused by a company across all processes, but the results can also be used to implement targeted optimization measures that comply with ever stricter legal regulations.
The study mentioned at the beginning(1) underlines that consumers are already often willing to pay a premium if products are demonstrably manufactured in an environmentally friendly way. At the same time, the opportunities for companies to continue "greenwashing" unchallenged are dwindling.
In this context, you might also ask yourself the question: is offsetting an alternative in the long term if continuous improvements can be achieved at product and supply chain process level with the help of SAP Sustainability Footprint Management? The answer is "no", even if close monitoring of company performance and the associated environmental impact results in a significant increase in transparency and efficiency. As a result, not only customers and legislators reward the commitment to sustainability, but also all relevant stakeholders.
We look forward to hearing from you!