Issue

The essential building blocks for CSRD reporting is based on tools from many vendors and Syensqos existing technology.  It requires combining into a solution for ESG reporting.  A decision is required on the long term solution post the implementation of RFI ESG Disclosure and Performance in 2024.  

Recommendation

Background & Context

RFI on ESG Disclosure and Performance was launched in 2024 to consolidate all Sustainability data in one place, create reporting layer and insights layer on top.  The RFI is aiming at a one to two year contract, which is to be revisited with ERP Rebuild.  Demos have been presented by SAP in 2024 to the business together with PWC.   RFI supported by KPMG experience with other clients and finalised in July 2024 based on 2.5 weeks response time for providers to answer by mid June 2024.  June/July 2023 Go-No Go decision.  

The required capabilities are:

• Centrally managed calculations. Avoid large proportions of pre-calculation in various source systems across the landscape. 
• Centralisation of ESG data and reporting.
• Long term solution committment.
• Annual or quarterly reporting metrics.
• Leverage of AI where beneficial.

Process

1. Assess metrics and data: Priortise ESG topics based on risks and issues
2. Automated data collection and preparation: data capture for emissions and ESG reporting
3. Centralised ESG data: granularity
4. Metric calculation:  aggregation and calculation of scope 1, 2 and 3 emissions and other ESG metrics
5. Sustainability tracking via analytic insights (including visualisation) and reports and disclosures (multiple frameworks)
6. Sustainability initiatives based on actions and ESG compliance

The process is driven by a variety of internal and external data sources, which need control, tracing and verification.

Functional architecture

The following tools are data sources for storage and consolidation (automated or manual).  Enrichment with external data may also be required.  Metric calculations should make use of AI generated insights.

Design/R&I:

1. Project portfolio
2. LCA

• WeGo (accolade)
• Simapro/Gabi
• Fast LCA, checklist

Sustainable procurement (STP -Supply Tracking and Prioritisation):

1. Bio and recycled based raw material tracking (SAP - Green Token material origins?)
2. Human rights due to diligence (Ethixbase)
3. Carbon footprint sharing (Sigreen)

Manufacturing:

1. Carbon scope 1 and 2 (SAP Green Ledger, other?)
2. Emissions reporting (SAP EHS Emissions Management)
3. Waste reporting (SAP EHS Waste Management)
4. Water reporting (tbc - not readable on slide 4)
5. Star Factory project portfolio (Wave, Gensuite)
6. Accident reporting (Gensuite)
7. CAPEX tracking (SAP Finance, Colmar)

• Cerise (redundant)

Supply Chain:

1. Carbon scope 3 (SAP)

• EcotransIT
• Concur
• BW Tiers

HR:

1. Diversity, Equity, Inclusion (DEI) (SAP SuccessFactor)
2. Training and performance (xls offline)
3. Gender pay gap (Payroll)
4. Living wages (Payroll)

Business:

1. Marketing (Sustainability Portfolio Management - SPM)
2. Inventory (SAP Product Compliance: Substances of Very High Concern - SVHC)
3. Life Cycle Analysis (LCA - tbc)

• PCF - redundant?

Greenomy

smaller scope plus AI as an option to combine with other tools for supplier interaction and environmental accounting. Risk of remaining a spot solution for compliance. Greenomy as short term solution, plug and play, so not overspend.  Quickest time for return, off the shelves.  For various reasons not signed in August yet. Committee will sign off in September 2024.

SAP Sustainability Control Towers (SCT)

Launch of 2024 RFI on ESG Disclosure and Performance was extended to SAP.  2024 RFI response by SAP not satisfactory with off the shelf slide pack containing access issues to links.  SAP Sustainability Control Towers (SCT) currently not mature enough, but could be revisited in three years. Scope, AI and insights not good enough. 

ESG data, elements on basic reporting using tools creating KPI library.  This should be covered by SAP.  SAP lacks enhancement of this data SAP i.e. reporting layer including e.g. KPIs, emission factors as per toole Ecoinvent and Ecotransit.  For example carbon accounting.  

Pureplayers look into public data where plant data is missing, to make assumptions where there is gaps.   Other functionality, AI native pureplayer is integrated benchmark.  Competitors in tool for KPIs in market based on public information. SAP solution does not cover this.  No company in manufacturing uses the Sustainability Control Towers. 

 Disclosure SCT was not to be solution.  

very limited AI, no disclosure tool, would require interface, requires custom integrations until S/4 is implemented. S/4 will bring SCT features.

Roadmap?

SAP overestimated level of integration which may be issue for disclosure.  Marginal only if Green Token or Green Ledger were implemented.  Emissions is game changer where solution is. 

Emissions mgmt in S4 would swing decision closer to SCT.

 SAP datasphere has no prepackaged off the shelf data for sustainability.

Possible to use Fabric as datalake, then SCT on top.

Microsoft Sustainability and Fabric. 

Queried during RFI.  Performance was promising.  Proof of concept in Taveau site launched last week for 2 months.   Goal to automate the calculation and gathering, traceability of 20 environmental KPI from SERF.  Technical feasibility to create some insights.  Does it need to integrate with S4.  no emissions in SAP at the moment. Integrates with MES system now based on data lake project where data collected by sensor.  Data lake Startek.  Idea is to collect water flow taking flow combined with Labware for analytical with pollutant, results in KPI as Microsoft had pre-packaged solution.  

Fabric has many more functionalities.  KPI library in Sustainability. Its just performance.  In relation to disclosure look to Microsoft Purview compliance Manager.  SCT is last mile disclosure.  Possible to use Fabric as datalake, then SCT on top.  Maybe separate Disclosure and Data e.g. KPI library.  Could also put Greenomy on top of Fabric.  SAP Datasphere is an option instead of Microsoft datalake.  Microsoft cloud may be good move with regards to Microsoft workstations. 

Embedded AI capabilities superior.

Pilot in autumn to test automation of environmental metrics and modelisation for data cleaning and then consume clean data on corporate level.

Automation can obtain consistent data and metrics to pinpoint sustainability issues in real-time.  Tech-enabled governance of the reporting process can manage complexity and risk.

Pure/Gensuite vs S4.  scop 1-3 about 20 metrics, 15 in scope 3.  Validation workflow most important.

not advanced enough for reporting (no CPD, taxonomy etc), lack of integration. Syensqo leaning more towards Microsoft. 

PAPM (SAP) currently used for tax purposes by Finance in scope of ERP Rebuild to deal with complex reporting requirements.  Might be an option to cover circularity for Sustainability.  SPM may not be the way forward as missing master data.  Additional option?

Assumptions

Implementation of related SAP Sustainability functions to support SCT.

Constraints

Impacts

Business Rules

Options considered

Option A:  SAP Sustainability Control Towers (SCT)

Option B:  Microsoft Fabric

Option C:  Greenomy - Do nothing

Evaluation

	Option A - SCT	Option B - Microsoft	Option C - Greenomy
Criterion 1	Pro Con	Pro Pro	Pro Con
Criterion 2	Pro Con	Con	Pro Pro
Criterion 3	Pro	Con	Con

See also

Change log

Workflow history