SAP Increases Focus on Sustainable Business

SAP AG (NYSE: SAP - News) announced a long-term strategic focus on sustainability, covering both its own operations and customer solutions for more sustainable business practices. First, to help its customers with their sustainability efforts, SAP, together with TechniData AG, unveiled expanded solutions for environment, health and safety (EHS) management. In addition, to demonstrate its commitment to sustainable operations internally, SAP announced it will reduce its greenhouse gas emissions down to its year-2000 levels by the year 2020. And, moving forward, SAP announced that its sustainability efforts will be led by a newly formed cross-functional sustainability organization headed by SAP's first chief sustainability officer.

Organizations throughout the world are facing increasing local, regional and global regulation; a challenging economic situation; increased consumer awareness to social and environmental issues; resource scarcity; and highly networked business operations. These factors put brands, market share and even market cap at significant risk, but also represent new business opportunities. Sustainability is about increasing the profitability of businesses by holistically managing economic, social and environmental risks and opportunities. SAP understands that its long-term success is directly related to both appropriately addressing sustainability internally and to enabling its customers to meet the same challenges.

"SAP is in a unique, dual position when it comes to sustainability," said Leo Apotheker, co-CEO, SAP AG. "We have a moral obligation to start with ourselves and ensure that our business operates in a transparent and accountable manner, leaves a minimal environmental footprint and reaches out to improve the social situation of others. As the leader in business software, we also deliver solutions that help other businesses achieve clarity across their operations and better manage their sustainability performance. This is why we are making a strategic, long-term commitment to operate our company in a sustainable way and to help businesses address social, environmental and governance challenges on a global scale."

Addressing the growing need for EHS management solutions, SAP and TechniData AG, the leading providers of EHS solutions, announced an agreement to expand their existing relationship. As a result, SAP will own and sell a full line of co-created EHS applications to be offered under a single name, SAP Environment, Health, and Safety Management (SAP EHS Management).

SAP already helps customers better manage risk and compliance for environmental, financial and supply chain concerns with its SAP BusinessObjects governance, risk, and compliance (GRC) solutions. Additionally, SAP  Business Suite software provides business process efficiency, flexibility and insight, representing a sound foundation for an organization's sustainability endeavors.

The SAP EHS Management application helps customers ensure that EHS requirements and corporate sustainability policies are met proactively and automatically across business operations. SAP EHS Management is open to work with non-SAP solutions yet is integrated into SAP Business Suite, a next-generation software suite that helps businesses optimize their performance and reduce IT cost, helping eliminate data inaccuracies and providing companies with the ability to manage business processes across multiple departments.

SAP and TechniData have worked closely since 1995 on the research and development of solutions designed to meet EHS compliance. They continue to co-innovate solutions to help companies around the world manage landmark regulation laws, including European REACH regulations for chemical use, as well as health and safety mandates to ensure the well-being of workers.

"The SAP solutions we employ at Dow Corning allow us to provide our customers with clear, easy and rapid access to vitally important safety information about our products and how they should be handled," said Dr. Peter Cartwright, executive director of environment, health and safety, Dow Corning. "We believe sustainability is essential to our future success as a company. It is so important to us, we've made it a corporate value. SAP solutions are fundamental to our ability to operate to our industry principles of Responsible Care and give our customers peace of mind."

In addition to delivering sustainable business processes through, for example, its SAP EHS Management application, SAP is helping its customers practice "Green IT" by enabling them to reduce the energy footprint of SAP solutions in their data centers through consolidation, virtualization and other landscape optimization services.

In spite of the fact that SAP's carbon footprint is usually smaller than that of organizations in other industries with similar revenue, the company is striving for significant reductions. After analyzing its global environmental footprint, SAP announced its commitment to a 51-percent reduction of its total greenhouse gas (GHG) emissions from its year-2007 published baseline levels of 513,000t CO2 by year 2020. This will return SAP to its approximate year-2000 emissions level of 250,000t CO2. SAP initiated its first global GHG inventory in 2008 and will report performance and progress towards the target in its annual sustainability report.

Using its own software solutions to monitor and manage its sustainability targets, SAP will achieve this reduction through significant abatement across all scopes of the Greenhouse Gas Protocol, the most widely used international carbon accounting tool. The target will apply not only to SAP's own direct emissions, but also to indirect emissions such as business travel, which was 42 percent of SAP's total footprint in 2007. The company's reduction plans are based on aggressive abatement targets across direct and indirect emissions (scopes 1, 2 and 3 as defined by the Greenhouse Gas Protocol, the most widely used international carbon accounting tool), allowing offsets to be applied only to major indirect emissions sources that are out of the company's direct control. SAP will focus on abatement over offsets and will pioneer and use new technologies that accelerate the abatement of carbon. It therefore does not plan to offset direct emissions or emissions related to energy consumption.

SAP has formed a new cross-functional sustainability organization to drive and coordinate all aspects of its sustainability efforts. It is led by Peter Graf, SAP's first chief sustainability officer and executive vice president of Sustainability Solutions, who will report directly to SAP Executive Board member Jim Hagemann Snabe. Graf, a 13-year SAP veteran, leads a global team that oversees all sustainability-related initiatives, from the creation of solutions that enable sustainable business processes for customers to SAP's own sustainability operations, including key social, economic and environmental programs.

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