SVForum presented the Clean Technology Conference with a focus on sustainable business on January 19, 2012, which was hosted by SAP in Palo Alto, California. The conference addressed the financial, regulatory and competitive challenges the clean technology industry has faced in 2011, as well as the outlook for 2012.
Leaders in several green tech industries talked about opportunities and challenges in the electric transportation sector and the new electric vehicle (EV) markets in 2012 and beyond. Panelists discussed energy efficiency projects and the developments in green buildings. In an innovation panel, speakers noted that energy efficiency breakthroughs have a promising outlook, however each business case needs to be viable. Providing easy, fast, effective and affordable solutions should be the focus, while scaling the solutions is also key. Other panels analyzed the investment landscpae, the clean technology innovations around sustainability and climate change, and talked about growth opportunities.
Peter Graf, Chief Sustainability Officer (CSO) and Executive Vice President of Sustainability Solutions at SAP closed the conference with an informative and inspiring keynote presentation. SAP has saved over one quarter of billion dollars in four years by becoming sustainable. In SAP’s 2010 Sustainability Report the company addressed economic, social and environment challenges. Sustainability is in the process of transforming businesses. Mr. Graf said that his company has gone through a shift: at SAP, sustainability reporting and carbon footprinting have been recognized as having an impact on the financial performance of the company. Therefore, the corporate sustainability report has become part of the SAP annual financial performance report.
Over the centuries, humans got resources from earth, used them, and then discarded. We have realized that we cannot continue to ‘do business as usual’ anymore. To address climate change and become sustainable, we need a different approach. For business solvency, we should not just monitor financial resources, but also other assets like natural resources, such as water and energy, and bring these into the bottom line in addition to the traditional financial performance.
SAP divides the sustainability report into Operations Impact, Customer Impact, Social Impact, and accountability.
On the operative side, savings were broken down into several items, such as reducing energy, reducing travel for business, incorporating renewables into the energy-source mix, using electric vehicles, broadband telecommunications, and telepresence. Other measures included installing intelligent lighting (LED), effective cooling/heating, water conservation and recycling, data center optimization, dynamic glass in windows/skylights, as well as implementing energy management systems (EMS).
Telepresence is so important in a global corporation with many worldwide offices. Mr. Graf said that in some international locations, a company-provided car is part of the compensation. Therefore, SAP has committed to using EVs in support of their sustainability goals and also built charging stations on-site. He noted that telepresence is the biggest winner of cost savings for a global corporation. For example, minimizing travel costs of several executives will pay back a teleconferencing set up. Graf also said that the item that offers the least payback is the incorporation of wind power into the energy generation mix.
Top management support is crucial for successfull sustainability and carbon reduction programs. Graf offered SAP CEO a four-year return on investmet (ROI) to get a buy-in. He said that changing behavior is equired to enhance support and understanding, ultimately leading to action and accountability. "Changing lights to LED will not encourage the user to turn off the light when he or she leaves the building", he said.
Graf enacted a combination of approaches, which gave individuals the transparency needed to instigate a behavior change. Gaming and incentives are effectively used at SAP to change employees’ engagement, where company–issued policies alone will not achieve the true and long-term desired changes. He gave an example of a company procedure coupled with an incentive: SAP managemnet set a carbon cap for vehicle utilization. Bonuses are given to employees who use less-carbon emitting cars. A company provided 'Dirty' car is not acceptable and its fueling will not be paid by the company.
He described the four key factors in helping people change behaviors: gaming, competition among employees, transparency, and incentives.
Sustainability needs innovation; To change behavior, we need to open the channel by listening and communicating.
There are four questions to be asked, representing four stages of change: Do you understand what we are trying to do? Do you believe me? Do you act on it? Do you act repetitively (i.e. it has become a habit)?
Graf said that people will always try to find loopholes if management forces them to act or tries to control them. Therefore, for fast results, he advised to set policies. However, for long term and effective results, he called for patience, where real change comes through understanding.
SAP has designed their sustainability programs and reporting to foster an interactive conversation. Collaboration will benefit all when companies and organizations share their programs and learnings, he said.
In conclusion, Graf said that sustainability plays a fundamental role in the business solvency and is part of the comapny’s safety net. It is a matter of 'can the business take risks not to be sustainable'.
Watch Peter Graf in the following video, describing his approach and programs: click on video.
ADDITIONAL INFORMATION
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