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Author's profile photo Susan Galer

Can Companies Balance Sustainability and Growth?

/wp-content/uploads/2014/03/smallgrafblog8_417294.jpgAt many corporations, the impact of sustainable business practices has been nothing short of amazing.  Fueled by new technologies like big data, mobile, and cloud, every industry has a major success story. Transportation companies are saving considerable amounts of money with more efficient processes. Utilities are improving power plant operations through advanced demand and supply approaches. Retailers are proactively managing supply chains. Consumer products companies are co-innovating down the entire value chain with raw materials providers on sustainable production methods.

In fact, Peter Graf, Chief Sustainability Officer and Executive Vice President of Sustainability Solutions at SAP, reports a seismic shift in how companies view sustainability and the broader effect that sustainable practices have on the market at-large. “It’s no longer just about what takes place within the organization’s four walls. Companies are now putting sustainability at the core of how they create value and in doing so, they are changing entire industries.”

Graf is most excited about how SAP is taking innovation and making it relevant, not just environmentally but also economically.

“We want our software to become more supportive of the circular economy while preserving environmental protection and social equity. With a clean cloud, we’ve managed to make sustainability extremely relevant in the biggest and most important growth area of the company. This is about moving sustainability into the core of value creation where it matters most for SAP and our customers.”

SAP’s sustainability results are documented in its just released second Integrated Annual Report 2013. Although the recent SuccessFactors and Ariba acquisitions increased SAP’s greenhouse gas footprint, Graf says the company’s commitment to 100 percent renewable energy in its data centers and facilities will realign emission levels to the company’s sustainability objectives moving forward. “Many of our on-premise customers will move to the cloud. With our 100 percent renewable commitment we expect to take our customer’s emissions out of the equation.” 

Indeed, one of the major challenges companies have is squaring sustainability objectives with business growth realities. The stakes are especially high in the technology industry. For example, the Global e-Sustainability Initiative (GeSi) reports that the data center is the fastest growing consumer of energy within the IT industry, increasing just over seven percent each year. IT overall will consume 30 billion megawatts of electricity by 2020. The need for balance is top of mind for SAP says Graf.

“We had a great year from a business perspective, and sustainability is always about balancing financial, environmental, and social impact. SAP has experienced enormous growth, along the change in our business model in becoming a cloud company.”

The tight connection between innovation and sustainability is inarguable. As technologies like big data, mobile, and cloud fundamentally change business processes, creating more profitability, companies like SAP are finding that these innovations can be equally instrumental to help increase environmental and corporate social performance.

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      Author's profile photo Larry Morgan
      Larry Morgan

      Lead not follow and that is exactly what we are doing using our sphere of influence.  Proud to part of the change.

      Author's profile photo Former Member
      Former Member

      Sustainability (or CR - Corporate Responsibility) and innovation are not mutually exclusive. In fact often when you look at a business through a "triple bottom-line" (3BL) lens you find new revenue opportunities:

      • Paint brush maker Purdy looked for ways to recycle their waste, hairs of brushes that fell to the assembly floor.  Rather than take those - at cost - to the dump incinerator, they found a floor polishing company that used the hairs in the fiber mix for buffing machines.
      • NIKE had millions of irregular shoe soles which it likewise was sending to land fills and incinerators.  The answer: floor padding - sold with upscale NIKE branding through partners like Home Depot - that sits under carpets.  Another example of waste = food in the manufacturing process.
      • GM bought up all of the old and oil soaked boom material after the Deep Horizon gulf spill and sent the fabric to suppliers for processing.  Not only was the up-cycling processes more cost efficient than buying new raw materials, they double dipped on the PR machine and put the new components made from the up-cycled material into the Chevy VOLT.

      Strategically CR needs to be part of the board discussion, rather than a compliance task relegated to compliance managers and legal counsel.  When the business unit management can fully engage through a 3BL lens, sustainable innovations can occur.

      Author's profile photo Former Member
      Former Member

      i fully agree.  and yet more can still be done.  internally and externally.