SAP Revs Up Talk on Green Accounting
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SAP is betting on green solutions to boost the bottom line -- both in its own business and customers'.
The German software giant today announced the acquisition of Clear Standards, a provider of carbon footprint tracking software.
SAP (NYSE:SAP) and Clear Standards did not disclose financial terms of the deal, which is expected to close in June. Clear Standards' chairman and CEO, Betsy Atkins, will remain with SAP as a consultant, SAP spokesperson Shabana Khan told InternetNews.com.
Along with the new acquisition, which is targeted at companies aiming to reduce their carbon footprint, SAP Co-CEO Léo Apotheker announced during his keynote at SAP's SAPPHIRE Orlando conference today that his company wants to set an example by reducing its own impact on the environment by 70 percent.
Part of that initiative focuses on SAP's carbon footprint, which the company had earlier this year highlighted as a chief area on which it plans to concentrate.
The company said today that it reduced its total corporate carbon footprint by 6.7 percent in 2008, compared to 2007, and plans to return to 2000 levels of carbon production by 2020 -- a reduction of about 49 percent.
"Some believe that sustainability is contrary to financial optimization, but the best way to reduce our carbon footprint is to become more efficient and consume less energy," Apotheker said.
Apotheker also said SAP plans to reduce water usage as well. The company will track other metrics too, Jonathan Becher, SAP's senior vice president of marketing, told InternetNews.com, but added that SAP has yet to announced them.
The update on SAP's efforts to go green continue what the company says is part of its corporate strategy.
"SAP has made a long-term, strategic commitment to sustainability because we believe it is a key aspect of being a best-run, clear enterprise -- both for us and for our customers," Peter Graf, chief sustainability officer and executive vice president of sustainability solutions at SAP, said in a statement.
The IT and computing industry can help companies reduce emissions, Apotheker said. "According to a study by our friends at McKinsey, the ... industry could help eliminate 7.8 metric gigatons of carbon emissions by 2020," he said.
Apotheker said that companies struggle to meet the goals of Corporate Sustainability and Responsibility (CS&R).
"The news of contaminated toys and baby formula show that it's not easy to achieve," he said. "A supplier several steps away in the chain could endanger your business by failing to meet your standards. Economies and companies do not operate in a vacuum but are tightly embedded in societies and the environment."
Apotheker said that sustainability is about managing the risks of regulation, energy prices, and a company's impact on the environment. "We have a moral and business obligation to embed moral and environmental considerations into the way we do business," he said. "Customers demand transparent behavior in the way that companies do business. For example, customers want to avoid companies that use child labor."
Becher said that the only way to manage CS&R is through SAP's detail-oriented focus.
"Léo used the word 'holistically,' and that's what you need to do," he said. "Nobody has looked at it from end to end before. You need to do it from order to cash in finance, from hire to retire in HR, and from sheep to shirt in the manufacturing of clothing."