BT targets sustainability improvements with SAP deal

UK incumbent BT is taking steps to give business customers a clearer view of its carbon emissions, in particular those of its suppliers.

The telco has partnered with SAP to launch a pilot of the software giant’s Sustainability Data Exchange (SDX). Unveiled in May, it is designed to help companies collect, trace and share data regarding indirect emissions, also known as Scope 3 emissions.

While Scope 1 and Scope 2 – which encompass direct emissions and emissions due to energy usage respectively – are easy enough for a company to keep track of themselves, Scope 3 is more challenging, because it comprises emissions produced by the whole supply chain. This can include upwards of dozens of other companies each with their own way of collecting and publishing data.

SDX aims to solve this issue. It uses carbon data interoperability standards established by the Partnership for Carbon Transparency (PACT) to provide one portal for securely storing and tracking supply chain emissions data. If enough entities adopt the standards, it should make it less of a headache to gather and share accurate Scope 3 data.

This is important because public trust in government, media and even charities is at an all-time low, and public cynicism about corporate ethics is at an all-time high. Advertising giant Havas even declared in 2021 that the world was entering what it calls the ‘Age of Cynicism’, where fewer than half of global brands are considered trustworthy.

In the case of the environment, when every news broadcast shows one half of the globe on fire and the other half flooded, enterprises that profess their sustainability credentials without hard data to back up their claims risk being met with snorts of derision and accusations of greenwashing.

The issue has been compounded this year by multiple reports that carbon offsets – which businesses use to improve their image as environmentally-conscientious corporations – are potentially worthless.

There is therefore mounting pressure to improve transparency when it comes to sustainability reporting, not just for ethical reasons, but as a commercial imperative.

IDC said this week that by 2024, 75% of large enterprises will have implemented purpose-built ESG data management and reporting software.

“Top business value–enhancing implications include heightened sustainability performance, enhanced brand perception, and improved financial and operational performance,” said Amy Cravens, research manager, ESG Management and Reporting Technologies at IDC, in a research note.

“Understanding the organisation’s current carbon footprint and leveraging analytics tools will enable organisations to improve processes in favour of reduced carbon consumption, a process which can have positive financial effects for the organisation,” she continued. “Furthermore, as deal flow is increasingly tied to ESG performance, having an accurate pulse on carbon emissions will often benefit customer and investor relationships.”

BT’s pilot of SDX certainly looks like a step in the right direction.

Business customers who purchase BT services through the SAP Business Network will be able to see the carbon footprint of BT and the products it offers. It claims to be the first UK organisation to adopt this process, and says it sends a strong signal of intent to standardise sustainability reporting across global value chains and get to grips with Scope 3 emissions.

“Typically, value chain emissions represent a greater proportion of a business’ carbon footprint than operational emissions. Tracking, measuring and acting on these and bringing more suppliers and partners on the journey will not just accelerate net-zero targets, but set a new precedent for sustainability reporting. Collaboration fuels progress and access to data is fundamental to getting it right,” said Sarwar Khan, global head of digital sustainability, Business, at BT, in a statement.

“The lack of standardisation in sustainability reporting has been a roadblock to progress for too long,” added Ryan Poggi, managing director of SAP UKI. “This creates confusion and an inability to validate real change. Our partnership with BT gives us an opportunity to refresh the guidelines and offers a blueprint for a universal standard in sustainability reporting. The aim is to create an environment for organisations to transparently tackle global challenges together.”

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