Leading enterprise application software company SAP said today that it plans to establish a multi-phased supply chain engagement program by 2024, aimed at significantly reducing greenhouse gas (GHG) emissions across its upstream value chain, including a goal to have each of its top 100 suppliers reporting their company-wide and product-level emissions for key products by 2027.
In a post announcing the new plans, SAP Chief Procurement Officer Nikolaus Kirner said:
“As a purpose-driven company, we are always looking for ways to improve through our global procurement organization. Sustainable procurement practices have become one of the key enablers in achieving net-zero targets.”
The announcement follows the launch last year by SAP of a commitment to achieve net zero emissions across its value chain in 2030, with a pledge to strength its engagement with key suppliers to commit to net zero and to deliver products and services on a carbon-neutral basis identified as a key focus area to reach its goal.
According to SAP’s 2022 Integrated Report, Scope 3 emissions account for approximately 97% of the company’s gross value chain emissions footprint, including 16% from upstream categories such as purchased goods and services.
The company said that it will work with its top 100 suppliers to report and record product-level emissions.
SAP CFO and Executive Board member Dominik Asam said:
“Reducing scope 3 emissions is a key factor on the journey to net zero. This is a team effort, and we are happy to collaborate with our business partners on reducing emissions throughout our supply chain.”
In addition to collecting emissions data, SAP also said that it will incorporate environmental considerations throughout its procurement process as part of the new engagement program, with plans to integrate a new sustainability classification system and to embed environmental impact criteria in procurement documentation.