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SAP Integrated Report: 2020 Targets Met Early

Feature Article | March 1, 2018 by Diana Pauly, Christine Susanne Mueller

Despite growing four-fold since 2000, SAP emits less carbon dioxide today than it did 18 years ago – and still has advanced ambitions.

Released this week, the latest SAP Integrated Report sets it all out in black and white: In 2017, SAP cut its CO2 emissions by 55,000 tons year over year. That’s a whopping 14%. But even more important: At 325 kilotons, the company’s carbon footprint is once again below year-2000 levels. Back in 2009, SAP had set itself the goal of reducing its global greenhouse gas emissions to the year 2000 level by 2020 – despite strong company growth in the interim. A closer look at the per capita values reveals just how impressive that reduction is: In 2000, SAP recorded 13.9 tons CO2 emissions per employee. Today it’s only around 3.8 tons.

But this improvement doesn’t come by chance. It is the result of a dedicated climate policy that SAP adopted in 2009 and has been following ever since, and it underscores SAP’s commitment to the United Nations Sustainable Development Goal (SDG) 13: “Climate Action.” The policy is part of a holistic management approach that is aimed at harmonizing the economic, social, and environmental performance of a company instead of focusing exclusively on optimizing profit.

The SAP Integrated Report, the company’s “online first” financial report, showcases just how SAP is making that happen. Among other things, the report provides key figures on the financial and non-financial value add of the company and explains the key connections between SAP’s economic, social, and environmental performance.

Where to Invest Efforts?

“SAP’s key lever for a sustainable future is our product portfolio, with which we enable customers to create positive economic, environmental, and social impact. Leading by example and being a trustworthy role model has always been very important to SAP. Our transparent results in the report show that we continue to make great progress in all areas and are turning SAP’s vision and purpose into reality. I’d like to thank all employees for helping the world run better and improving peoples’ lives,” says SAP Chief Sustainability Officer Daniel Schmid.

While the focus is on innovations that help customers become more sustainable, SAP is just as committed to reducing its own greenhouse gas emissions, and has implemented a number of measures in order to achieve this. Currently, SAP’s sustainability strategy is based on the three pillars of avoid, reduce, and compensate:

  • Avoid: Emissions are avoided wherever and whenever possible. Substituting business flights with video conferencing is just one example.
  • Reduce: SAP has programs in place to increase efficiency in data centers, for example, that scale significantly and not least benefit our customers in the cloud.
  • Compensate: SAP compensates for remaining emissions by investing in certified climate projects with high quality standards.

Cornerstone No. 1: The Green Cloud

Switching to electricity from renewable energy sources was a key milestone. Between 2010 and the end of 2013, SAP converted all of its data centers and office buildings to green energy, and at the same time increased the energy efficiency in its buildings, above all in the data centers, by leveraging innovations in server virtualization and air-flow management.

A clear indicator of just how successful that approach was is the power usage effectiveness (PUE) value of its global data center in St. Leon-Rot, which is currently 1.36. As such, the energy required to maintain the SAP facilities is now just one-third of the energy consumed by the servers. This is an ideal value for a data center operating in the highest availability class.

Cornerstone No. 2: Intelligent Mobility

Following the successful establishment of a green cloud, SAP’s climate management is now focusing on reducing the remaining sources of emissions. More than four-fifths of its current emissions are generated in the mobility sector. Among the culprits is commuter traffic, which produced 49 kilotons of CO2 in 2017. That being said, according to SAP’s most recent internal commuting survey, carbon emissions per SAP employee went down by 6.6% compared to the previous year.

SAP supports this development through a number of measures ranging from promoting bicycle use, rail transport, and e-mobility, to the operation of its TwoGo ride-sharing solution, which is open to employees and external drivers alike. Employees are also taking an increasing number of home office days — up 16% in 2017 — which is expected to have further reduction effects.

Air travel currently accounts for more than half of all mobility-related CO2 emissions. To reduce its carbon footprint in this area, SAP encourages the use of telepresence, video conferencing systems, video telephony, and other virtual collaboration technologies. Thanks to such measures, the number of flights remained constant in 2017 despite continued business growth. A reduction in the absolute number of business flights is not expected; as the world’s biggest provider of business software, SAP relies heavily on close contact with its customers and partners, and will therefore continue to depend on a certain minimum level of flights going forward.

Carbon Neutral as of 2025

Notwithstanding the above, SAP has set itself the goal of being fully carbon neutral as of 2025. Again, avoidance and reduction will be key factors in achieving this ambition. Whenever SAP is unable to reduce emissions on its own, it turns to the third pillar in its operating strategy: compensation. This fallback option means investing in CO2 offsets, such as the Livelihoods Fund’s forest restoration program. In return, SAP receives carbon credits from the sponsored offset projects. In 2017, SAP’s offset efforts resulted in total compensation of 160 kilotons of CO2.

SAP primarily uses the renowned World Wide Fund for Nature (WWF) GOLD Standard to select its offset projects. The advantage of the WWF “seal of approval” is that it not only discloses the carbon footprint of the projects, but also makes clear how the projects impact the social environment and the neighboring ecosystems.

By 2050: 85% Less CO2 Along the Entire Value Chain

SAP’s goal to be carbon-neutral by 2025 addresses the company’s internal operational processes. What customers do with SAP products is another matter. In 2017, these so-called product-in-use emissions totaled 9.7 megatons CO2. Thus, looking at the downstream emissions, climate management will be a much longer-term undertaking than minimizing SAP’s internal carbon footprint.

And SAP is tackling the problem head on. In June 2017, it committed itself to reducing all CO2 emissions of the reference year 2016 by 85% by 2050 as part of the Science Based Targets initiative. The first major interim stage is 2025, by which time a minimum 40% reduction is expected.

“Given our cloud strategy, this roadmap is definitely feasible,” says Schmid. “If all goes to plan and we really are cloud-only in 2050, the entire operation of our solutions will take place in SAP’s carbon-neutral data centers. And that in turn will mean less product-in-use emissions.”

The journey continues.


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