Secret to sustainability - supply chain, environmental measures

Sven Denecken

The business software vendor's credentials in the field of environmental awareness and practices was reaffirmed again in January this year when it was named to the Corporate Knights Global 100 Most Sustainable Corporations list for the sixth consecutive year.

There is only one option if you want to excel in sustainability and that is if you tackle the supply chain. Where and how you procure makes you reliant on other companies and how they are dealing with sustainability. Therefore, we see a lot of push down the supply chain to see how to get data and transparency from where you procure.

Companies are taking over a lot of liability, so this data should be very secure and very clear. It is also about exchanging that data because companies you sell to will judge you on that information. They will start to ask the nasty questions like, what is the footprint of your company, what is the footprint of your supply chain, because they will need to take it into their equation.

An illustration of this point is how US discount retailer Wal-Mart determined that 92% of its carbon footprint lay in the supply chain.

SAP has developed a host of reporting and optimisation tools to help customers achieve a better view of their organisation and supply chain, while also generating reports and dashboards that provide an organisation-wide view of performance according to set criteria.

The key measures companies should have a clear hold on - internally and externally - include the cost of energy, transportation, and the overall product or service life-cycle, specifically with a view at the design stage of what the costs and implications are going to be on recycling, for example. Existing and proposed legislation is another key area that companies need to be aware of, with leading companies already calculating the impact of upcoming legislation on their operations.

The issue of sustainability can no longer be seen in isolation and that it has to be linked to the profitability of an organisation. You can only do that if you holistically tackle environmental, social and economic trends and if you not only look at the risks, but also the opportunities that can be derived from that. As an organisation that touches 65% of the worldwide GDP, SAP has taken it upon itself to use that position to influence thinking on sustainability and how to achieve that profitably.

*The above address was given at the inaugural SAP Sustainability Summit in South Africa held in Johannesburg recently.