Spotlight On The Green Ledger Part Two
“A HUGE BUSINESS OPPORTUNITY”
For partners, these new solutions provide a ‘huge business opportunity’ particularly with customers who’ve ‘underestimated’ the scale of the task required to build a sustainable business model.
Jesper says: “Legislation is only going to be accelerated, it’s going to become a legal obligation to report on environmental numbers. Plus there’ll be a monetary cost. Then you’ll need to find the right people who can build a business with sustainability as part of its blueprint and have a rigorous, auditable, robust, data foundation. And then you need to think across your entire supply chain – every element will need to be transparent and feed into your footprint. It’s huge. There’s a lot to do.
“Partners can seize this opportunity to really differentiate themselves and they play a massive role in helping our customers to become sustainable businesses. I would advise them to familiarize themselves with the new solutions that are there, then excite our customers about their value and help them to move from insight to action. Think about these solutions as an integral part of a customer’s blueprint and help them to transform their business models financially and sustainably.”
MEASURING SUCCESS – HOW THE GREEN LEDGER WORKS
The Green Ledger developed by Jesper and his team works by measuring data. By modeling the carbon footprint of every business activity going into building and combining that footprint with the emission factors sourced from public databases, it gives an expression of, for example, the CO2 ‘cost’ of an activity or product.
The data used comes from business operations such as stock levels, types of materials, transportation activities, and energy consumption levels combined with emission factors. The majority of this data is often already registered in business systems – such as SAP – while the emission data comes from publicly available life cycle assessment (LCA) databases. Over time, these will be improved and enriched.
Says Jesper: “Today, typically around 80% of the impact stems from outside of the control of the business and, therefore, the data used here is often secondary data or averages and is often collected manually. With the SAP Sustainability Data Exchange (SDX), this data can be collected based on one, global, standard solution that runs across every step of a typical value chain.”
Once collected and modeled, the data can be analyzed in the SAP Sustainability Footprint Management (SFM) to understand the impact of business operations by geography, organization, and product.
These insights can then be embedded into the Green Ledger so that companies can make decisions that weigh up both the financial and the sustainable impact of working with different vendors, designing products, managing operations, and planning logistics.