Amid the pressing reality of our world’s escalating climate crisis, and with customers of businesses in all industries increasingly demanding more sustainable practices, ASUG is set to unveil its first sustainability-focused research report for the SAP ecosystem.
The Role of SAP Solutions in Sustainability Efforts
As part of its efforts to meet this demand, SAP has developed a suite of solutions—including SAP Sustainability Control Tower, SAP Sustainability Footprint Management, and SAP S/4HANA Cloud for EHS environment management—aimed at enabling customers to track vital data necessary to driving sustainability initiatives and goals.
ASUG surveyed 85 of its members—with high levels of involvement in their enterprise’s sustainability initiatives—about their organization’s approaches to sustainability and the challenges they face in adopting sustainability solutions. The respondents represented enterprises across a variety of industries, including consumer products, chemicals, utilities, and health care. Here are our top takeaways from the research, set to be released in full this April.
The Priority of Sustainability
While sustainable practices are steadily becoming more of a priority for enterprises, adoption of these practices can be costly and time-consuming. Amid the economic challenges of the last few years, shaped by the aftereffects of the COVID-19 pandemic and inflation, committing the necessary resources to initiate effective and wide-reaching ESG efforts can be difficult for enterprises.
However, despite these setbacks, ASUG found that an overwhelming majority of respondents (91%) said their companies are turning their focus to sustainability initiatives. Specifically, 56% of respondents indicated their companies are “very focused” on sustainability, and 35% reported their organizations are “somewhat focused.”
ASUG also examined the factors that encourage its members to adopt sustainable practices. Meeting customer demands (47%) and regulatory compliance (45%) topped the list of reported factors. However, external demands were far from the only influential factors. The next three most reported options were:
- Efforts to improve an organization’s reputation (45%)
- Sustainability’s importance for a company’s specific industry (44%)
- Sustainability has always been an organizational focus (42%)
How Sustainability Efforts Are Led and Measured
ASUG also examined exactly how respondents measured sustainability success and failure. There is no single “correct” approach to this reporting, and approaches can differ based on a variety of factors, including companies’ sustainability objectives, products, and industries. Understanding how our members quantify sustainability is vital, as this data is used in regulatory and compliance reporting.
Over two-thirds (65%) of respondents said their organizations track sustainability KPIs and metrics. Meanwhile, 27% of respondents indicated that their companies are in the process of defining which KPIs and metrics to track. A far smaller share of respondents (7%) said they address and comply with sustainability-related regulations and standards differently—such as custom regulations and working with third-party organizations to define metrics.
Key Data Tracking Points
The sustainability-focused research also examined the specific data points organizations are tracking as part of their sustainability efforts. ASUG asked respondents to select all the options that applied to their efforts. The top three selections were:
- Energy consumption – 67%
- Greenhouse gas emission/carbon footprint – 52%
- Water use – 44%
In terms of driving sustainability efforts, ASUG found that management styles can vary from company to company. 44% of respondents said C-level executives lead and develop sustainability initiatives at their companies (compared to 25% who indicated line-of-business staff should take point on such initiatives and 23% who said a cross-departmental project team should lead the initiatives).
Sustainability Challenges
Despite the importance of sustainability efforts, all organizations must overcome significant barriers to success. Our members’ most frequently cited challenge was “financial concerns,” including return on investment, high costs, and maintaining profit levels. One respondent told ASUG their company must see a business driver—like regulatory necessity or improved efficiency—to justify the cost of sustainability progress.
Organizational engagement and buy-in were the next most frequently cited challenges. Many organizations cited competing business demands for similar resources to those consumed by sustainability efforts as a barrier.
Additionally, all enterprises must ensure their workforces are equipped with the knowledge and skills necessary to lead and maintain successful sustainability initiatives. While 44% of respondents said no knowledge or skillsets are missing in their organizations in this area, another 40% said they are “not sure” if such a gap exists in their enterprise. Only 16% of respondents definitively said their company lacks the skills and knowledge.
In closing these skills gaps, many easy methods to spur sustainability education are available to the modern enterprise. Over half (58%) of respondents said they are open to learning via webcasts and webinars, while 48% said they preferred to gain insights from learning more about the challenges and successes of others via customer stories.
Stay Tuned!
ASUG will publish the full results of its ASUG Sustainability Research survey in April. In the meantime, stay tuned to First Five for more insights from this research.