SAP: Data and digitization are critical to stewarding sustainability in PH.

Staff ni Anjie

SAP: Data and digitization are critical to stewarding sustainability in PH.

Businesses and governments are racing to achieve a sustainable, green, and digital economy and are under pressure to publicly display their sustainability goals.

In the Philippines, for example, the government has increased its efforts to strengthen community climate resilience and address climate change to protect the environment, people, and property. Last year, the government submitted the first nationally determined contribution (NDC) to the United Nations Framework Convention on Climate Change (UNFCC) Secretariat, covering its targeted reduction and avoidance of greenhouse gases (GHG) of 75 percent, of which 2.72 percent is unconditional. This commitment applies to agriculture, waste, industry, transportation, and energy from 2020 to 2030.

The Philippine government also pledged to support the host country, Egypt, in its efforts to revitalize international consensus on the climate crisis at the UN's 27th Conference of the Parties (COP27) in November 2022. It also reaffirmed its call for climate justice and developed countries' financial and technical support for climate initiatives, particularly for developing countries.

Becoming sustainability stewards

Meanwhile, many companies have stepped up in recent years to help achieve a more sustainable future by incorporating environmental, social, and governance (ESG) factors into their strategy frameworks. For example, at this year's COP27, SAP (NYSE: SAP) pledged to support more global policy transformation and help innovate sustainable businesses by assisting in reenergizing emerging economies in their goal of achieving trillion-dollar greener impact and job creation.

According to a recent SAP and Oxford Economics survey, 66 percent of Asian businesses believe it is not difficult to be both sustainable and profitable. However, only 8% believe their sustainability strategies provide significant value.

This reality may have occurred due to a disconnect between many organizations' sustainability plans and actions. While 60% of businesses have a communicated sustainability plan, with Japan leading at 68% and Indonesia ranking lowest at 46%, only 20% have incentivized leaders based on their success. Furthermore, less than half (44 percent) say their employees are active participants in their sustainability efforts, with India having the highest at 52 percent, Singapore having 51 percent, and Malaysia having the lowest at 33 percent.

“Businesses across Southeast Asia, including the Philippines, believe that they can boost their earnings while protecting the environment. This reality is a positive indicator to continue pushing towards sustainability. However, organizations must refocus their strategies to realize the significant value and reap better and actual outcomes,” said Rudy Abrahams, Managing Director of SAP Philippines.

See Also: IDC Names SAP S/4HANA Cloud as Global Leader in SaaS and ERP Systems

Regulatory compliance: a crucial driver of sustainability and a challenge

Rudy Abrahams was joined by Apple Evangelista, Head of Sustainability and Social Responsibility (SSR) of Globe Group, and Henrik Batallones, Marketing and Communications Director of the Supply Chain Management Association of the Philippines (SCMAP), at a recent SAP media event held at its headquarters in the NAC Tower, Bonifacio Global City in Taguig to discuss how organizations have been refocusing their strategies to ensure sustainability.

“In the Philippines, organizations used to consider sustainability as a cost tied to regulatory compliance. But that perspective is changing. Sustainability is now seen as a strategic imperative to ensure that organizations not only provide better service to their customers but also help ensure a sustainable future,” said Batallones.

SCMAP is the country's leading supply chain industry organization. SCMAP, which is made up of some of the country's largest manufacturers, logistics providers, and retailers, works with stakeholders in both the public and private sectors, advancing supply chain education at all levels, and organizing events that allow supply chain professionals to connect in order to improve the industry's global competitiveness.

Meanwhile, citing data from the SAP and Oxford Economics report, Abrahams stated that compliance is the region's second biggest sustainability challenge (26 percent), trailing only reinventing business strategy. This means that organizations in the country may need to refocus their strategies in order to achieve greater value and reap the benefits of sustainability.

Improving sustainability outcomes by investing in data

The efficient use of organizational data to make more informed decisions will be critical to enhancing sustainability results. This remains difficult for firms in the Philippines since it takes time, especially for enterprises like Globe, which has multiple entities with distinct processes and reporting formats.

To address this issue, Globe has been utilizing SAP solutions, which now run 70% of the company's internal systems. With SAP solutions in place across its global business units, the company migrated to SAP S/4HANA to improve fragmented processes, manual workloads, inefficiencies, lack of insights, and delayed decision-making.

Meanwhile, SAP Fiori apps aided in improving user experience and insight access. Increased visibility allows for more informed decision-making across the organization, while automation and fewer reconciliations in finance allow for faster financial transaction processing, book closing, and error-free reporting.

Finance functions became more integrated and efficient, allowing for real-time business insights, while IT security was strengthened through improved authorization controls and compliance. SAP S/4HANA proved to be a catalyst for change for Globe Group, allowing it to quickly adapt to changes in its business environment by facilitating these improvements.

“Globe’s core values are centered on innovation and sustainability. We look at pressing problems and innovate from there, ensuring that we help solve the real issues and contribute to a more sustainable future. We envision making families’ dreams come true and empowering businesses to flourish to help achieve an admired nation. As we create our products, we always anchor them in that vision,” Evangelista said.

Abrahams couldn't be more in agreement. He noted that businesses that derive value from sustainability exhibit characteristics such as setting clear strategic expectations, leveraging the transformative power of technology and data management, and engaging with key audiences such as employees, supply chain partners, and policymakers.

Assisting organizations on their path to sustainability

For example, SAP has assisted organizations in their data-enabled sustainability journey, from driving transparency for disclosure purposes, incorporating or optimizing their data to make more sustainable business processes and decisions, to scaling sustainable practices across industry business networks and value chains.

SAP enables organizations to achieve zero waste, zero emissions, and zero inequality through various solutions, in line with its mission to help the world run better and improve people's lives. SAP ESG solutions portfolio provides a scalable and integrated reporting platform, as organizations now demand fast, reliable, and compliant standard regulatory reporting and want to leverage insights for internal sustainable business transformation.

Among its offerings is the recently updated SAP Sustainability Control Tower (SCT), which can help improve ESG transparency and long-term business performance. SCT enables companies to record ESG factors through out-of-the-box integration with SAP systems, resulting in faster time to value and granular data visibility based on actual data rather than averages.

Based on an open and extensible solution with the largest ESG ecosystem, the solution also enables companies to report regulatory-compliant ESG metrics covering common frameworks. Finally, it enables business leaders to have an effect by acting on actionable insights, forecasting and setting goals, tracking efforts, and optimizing business processes.

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