Issue

Succinctly describe the issue or problem statement that this Decision addresses. Why is a decision required? What business or technical problem does it address?

Syensqo is required to compute its Corporate and Product Carbon footprints for different stakeholders:

• investors and markets as it has a target on GHG emissions reduction
• regulators in various jurisdictions
• customers
• internally for teams to whom the reduction target is cascaded to to operationalize it in their respective perimeters (eg industrial, procurement, supply chain...)

A decision is required as to which tools should manage the business and system process for Sustainability footprint management in line with the Syensqo Sustainability roadmap, potentially replacing current tools in the Sustainability landscape.

Recommendation

Summarise the recommendation being made for the reader, leaving the pro/con evaluation and exact decision-making process to the subsequent sections.

There is an expectation that Syensqo should adopt a mainstream integrated solution for carbon footprint management.  It enables Sysenqo to achieve group targets by understanding where emissions come from at operational level.  Data accuracy is key to govern and implement the solution going forward, hence it needs to be based on an integrated data flow which represents one version of truth. 

The recommendation is for the business to implement SAP EHS Emissions Management to cover Scope 1, 2 and 3 requirements as part of an integrated ERP solution (Option D).  

This would lead to the decommissioning of Cerise, Digital PCF and associated dashboards. 

Background & Context

Explain the context in which the decision is being made.

Due to complexity of acquiring information on the downstream part Syensqo typically provides cradle to gate carbon footprint rather than cradle to grave. The related frameworks are mainly GHG protocol, over and above the International Organization for Standardization (ISO) and Together for Sustainability (TfS), a joint initiative of chemical companies.  Sustainability footprint management in Syensqo is split as follows:

• Emissions management
• Water management 
• Energy management
• Land use  (out of scope for this KDD)

The following activities are to be considered as part of the scope for this KDD:

• Scope 1 and 2
  • Energy provider operations (Scope 2)
  • Company premises (Scope 1)
• Upstream activities Scope 3
• Downstream activities Scope 3

Syensqo currently relies on industry data where no supplier data has been requested or supplied. Collecting PCF data from suppliers is instrumental to understand Syensqo's upstream Scope 3 baseline and measure progress.  Stakeholders, including investors, customers, and regulatory bodies, increasingly demand transparency and action on Scope 3.1 emissions.  PCF also needed for corporate ESG disclosures, especially 3.1.  Failure to comply can lead to reputational damage and financial consequences.  There is an ongoing procurement initiative in Syensqo for pressuring vendors as part of scope 3.1 emissions (purchased goods an services).

Assumptions

Clearly describe the underlying assumptions which informed or limited the choices available, or impacted the decision: cost, schedule, regulatory requirements, business drivers, country footprint, technology, etc. Include links as necessary. This section is important because a future change in circumstances might invalidate some key assumptions, which then prompts a decision to be revisited. 

The following assumptions are underlying the SAP SFM solution recommendation to be a valid design: 

• All SAP deliveries require transportation and are covered by carbon footprint management upstream and downstream via SAP Transport Management and S/4HANA.
• The SAP licence for SAP S/4HANA Cloud for Environment Management (private edition) is covered as per implementation of SAP EHS Waste Management (separate KDD).  
• Footprint management and calculation is required on site and product level.  The solution for transactional carbon accounting requires more precise and granular tracking of emissions across business operations and supply chains.
• Rigorous rules for footprint management as well as related accounting data across the value chain are required to comply with regulatory and Financial Accounting standards.  
• Enhanced data capture, acquisition and governance is required throughout the organization e.g. data related to Scope 3.1 carbon emissions associated with the procurement of products or services. 
• The solution impacts various processes and stakeholders outside of Sustainability.  Appropriate business and stakeholder support is required on all levels due to the significant process and supply chain changes.
• All impacts and assumptions of the SAP SFM solution need to be understood by all impacted business processes and stakeholders. 
• SAP SFM impacts need to be included in relevant business roadmaps e.g. Procurement, Finance, Logistics etc.
• All management across the supply chain needs to be invested in supporting the SAP SFM solution.
• Appropriate system and process training will be conducted with all relevant users as part of the implementation process.  
• Which of the current applications in the ESG landscape will be replaced by the SAP SFM solution will be confirmed as part of detailed design. It may require a 'parallel' phasing out period of non-SAP applications, which are covered by the SAP SFM solution forward.  
• A contingency plan as part of the SAP SFM will be included in the implementation to ensure continuity when switching from related SAP and non-SAP applications.

Constraints

Capture any constraints or limitations inherent to the recommended option. This could be aspects which, if changed or removed in future, could cause the decision to be revisited or invalidated. For example, a constraint might be that a new product has significant gaps in important functionality, which caused an older alternative to be recommended. If those gaps are closed in future, this might cause the decision to be invalidated.

• This KDD covers the carbon footprint management only.  
• Some technologies and product's compositions are submitted to export control regulations
• SAP SFM - Roadmap:
  • SAP Roadmap for 2025 included footprint breakdown for fossil and biogenic emissions product footprints
  • Integration with Transport Management
  • Simulation capabilities for various footprint scenarios and what-if analyses, enabling sensitivity analysis and comparison of product carbon footprints. It assists in sustainable decision-making regarding product design, production efficiency, and supply sourcing.
  • Connections to Business Networks like SAP Ariba and Catena-X for data collection and sharing, supporting the PACT-Standard.
  • Importing and managing emission factors to be extended to other impact categories, like water or land use. 
  • To support the move from average to actual footprint calculation SAP plans to launch an API for sharing product footprints along the value chain, adhering to global standards like the World Business Council for Sustainable Development's Partnership for Carbon Transparency (WBCSD PACT) and the Together for Sustainability (TfS) initiative.  It will provide direct access to supplier footprints, simplifying the mapping process and improving data quality with primary data.
  • Introduction of automated mapping recommendations, a mapping wizard with validation checks, and an API for external providers for emission factors mapping of purchased products. 
  • More Scope 3 categories associated to downstream emissions and people transport are planned for future releases beyond current release scope of GHG Scope 1, 2, and 3 categories related to material, freight transport, and facilities.

  • Updated version of the existing Analytical API will be available to integrate the calculated footprints into any other analytical application for analytics, disclosure, or other purposes..

Impacts

Describe the impact of the decision on other aspects such as other processes, infrastructure, other SAP modules or systems, data cleansing and migration, developments, automations, interfaces, in-flight projects, etc.

• The solution for carbon footprint management impacts the fate of legacy applications covering the same scope: Cerise and Digital PCF
• It is expected that the change of methodology, emission factors and data cleansing may modify the carbon footprint of certain categories

Business Rules

The decision may translate into business rules which enforce the decision and will require configuration. List these business rules here. For example, "An Outline Agreement cannot be created via the RFQ process. An awarded RFQ can only result in a Purchase Order". 

Options considered

List the options (viable options or alternatives) you considered. These often require a longer explanation with diagrams, or references to other documents (links are best, but attachments are also possible). Use enough detail to adequately explain what you considered so that a project or business stakeholder reviewing this decision will not come back and ask "did you think about...?"; this leads to loss of credibility and questioning of other decisions. This section also helps ensure that you considered enough suitable alternatives rather than just copy/pasting SAP's recommendations.

Option A: Continue As Is

Currently this data is built up by experts (internally and externally) or sourced from external databases.    There is no one version of the truth.   Syensqo needs to act with its suppliers to reduce Scope 3 emissions to reach Syensqo's climate commitment and support product competitiveness.  The future solution for footprint management in Syensqo needs to be determined as part of Scope 3 aligning with ERP project principles.  

• Lack of integration with S/4HANA.
• Large variety of non-SAP tools.
• Lack of granularity.
• Lack of system and data integrity.
• Not future-proof.

Option B:  SAP Sustainability Footprint Management (SFM)

Decribe the option in sufficient detail for a reader familiar with the subject matter to understand it properly

SAP SFM calculates and manages carbon footprints across GHG Scope 1, 2, and 3 emissions, integrating with SAP S/4HANA for accurate and efficient emissions calculations.  The solution tracks the flows of product footprints in and out of the business, the materials used to produce it and the transportation.  As a solution for transactional carbon accounting it enables more precise and granular tracking of emissions across business operations and supply chains.  SAP SFM can:

1. Manage supplier product footprint according to World Business Council for Sustainable Development Partnership for Carbon Transparency (WBCSD PACT)
2. Calculate Scope 3 categories on activity level e.g. transport of purchased goods.
3. Calculate product and organisation footprint according to material flow

Product Capabilities

The capabilities of SAP Sustainability Footprint Management can be broken down as follows: 

1. Acquiring master and transactional data from connected business system.
2. Combine the data with emission factors to evaluate the environmental impact.
3. Calculating of the sustainability footprints in the application.

Business Architecture

SAP Sustainability Footprint Management runs on SAP Business Technology Platform, extracting and integrating data from SAP S/4HANA and other sources to calculate and store carbon footprints, which are then fed back into business processes and will increasingly connect with tools like SAP Sustainability Control Tower and supplier networks for end-to-end sustainability insights and reporting.

Data Acquisition

SAP Sustainability Footprint Management reuses ERP master and transactional data via native integration with SAP S/4HANA or APIs, supports file-based imports and transport datasets, and is evolving to include enhanced cost and emissions integration, as well as connectivity with networks like SAP Ariba and Catena-X for standardized sustainability data exchange.

Emission Factors Management

SAP Sustainability Footprint Management enables the import, management, and AI-driven mapping of emission factors (focused on CO₂e) using ERP and supplier data, integrates LCA datasets from providers like ecoinvent and Carbon Minds, and is evolving toward automated, high-accuracy footprint calculations through primary supplier data exchange and standard-based integrations.

Footprint Calculation

SAP SFMs calculates product and corporate carbon footprints across Scope 1, 2, and upstream Scope 3 (cradle-to-gate) by integrating ERP and supplier data, modelling energy flows and allocations, and defining organisational boundaries, with plans to extend to full lifecycle (cradle-to-grave) coverage.

Energy Flow Model:

SAP SFM calculates both organizational (Scope 1, 2, 3) and product-level carbon footprints using ERP data, emission factors, and energy models, offering complementary methods that Syensqo combines to analyze emissions and identify key drivers.

A Sankey Diagram is the core tool for investigating emission results, offering transparency on input factors, such as purchased energy.  It gives visibility to various levels of detail, including calculation data and formulas, to understand the carbon footprint emissions. The app allows publishing results to connected SAP S/4HANA Cloud or SAP S/4HANA systems.

Sankey-Diagram:

Footprint Analytics

SAP SFM provides built-in analytics dashboards to visualize and drill down into carbon footprints across the value chain, including detailed breakdowns by GHG scopes, transport flows, and emission hotspots, with API integration for external analytical tools.

Option C: SAP EHS Emissions Management

Decribe the option in sufficient detail for a reader familiar with the subject matter to understand it properly

SAP EHS Environment Management tracks various aspects of environmental impacts.  It primarily focuses on tracking and managing emissions and pollutants released into the environment.  Whilst only SAP EHS Emissions Management and GHG Emissions Management are relevant for the purpose of this KDD, it generally includes the following components:

• Waste Management (separate KDD)
• Emissions Management (EM)
  • Manages all types of emissions resulting from operation to fulfil legal requirements e.g.
    • Hazardous air pollutants
    • Significant air pollutants (NOx and SOx)
    • Greenhouse gases (GHG)
    • Air or water emissions
• GHG Emissions Management
• Water/Wastewater Management 

Capabilities:

• Monitoring and reporting of emissions data.
• Flexible and auditable calculator for hazardous air pollutant and GHG emissions inventories.
• Calculates and aggregates emissions through data transparency and monitoring.
• Various options for collecting data and sampling to be used for compliance tracking and emission calculations.

While SAP EHS effectively supports well process and waste emissions, it cannot compute product-level Scope 3 footprints across the full value chain. In particular, EHS does not support detailed lifecycle-based allocations, supplier-specific footprint integration, These capabilities are instead addressed by solutions like SAP Sustainability Footprint Management, which are designed for product-level carbon accounting and full Scope 3 coverage.

Option D:  SAP Sustainability Footprint Management (SFM) and SAP EHS Emissions Management - combination

In standard SAP the holistic Sustainability solution for Footprint Management combines various components in its architecture, which are intrinsically integrated.  Whilst some of these components may be implemented in isolation, the Syensqo Sustainability Roadmap requires a combination of tools to create 'one truth'.  It supports Syensqo's long-term goal to adopt a mainstream integrated solution for carbon footprint management and supports achieving group targets by understanding where emissions come from at operational, procurement and market level. 

SAP SFM can be supplemented by the integration with SAP EHS Emissions Management with SAP SFM (see SAP SFM Product Capabilities and Business Architecture diagrams).   There is no additional SAP licence requirements (SAP licence same as SAP EHS Waste Management, covered by separate KDD).   The recommendation is for the business to implement SAP EHS Emissions Management for Scope 1 and 2 as well as SAP SFM to cover current and future Scope 3 requirements from the outset as part of an integrated ERP solution.   Please refer to option B and C for capabilities and benefits for each solution.

Evaluation

Outline why you selected a position. The best format could be a pro/con table (sample below), but is up to you as the author. You must consider complexity, feasibility, cost/effort to implement, but also ongoing operational impact and cost. You must consider the program principles and explain any deviations in detail. This is probably as important as the decision itself.

See also

Insert links and references to other documents which are relevant when trying to understand this decision and its implications. Other decisions are often impacted, so it's good to list them here with links. Attachments are also possible but dangerous as they are static documents and not updated by their authors.

1. 2023cSyensqo Annual Integrated Report
2. McKinnon Report
3. SAP Roadmap Sustainability Footprint Management (SFM)

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