The converging forces and interests of cloud migration, maturation, and sustainability strategies will be front and center when Japen Hollist, SAP Head of Sustainability, North America, hosts a keynote session at the upcoming ASUG Best Practices: SAP for Cloud conference.
In addition to briefly describing cloud migration as a clear “sustainability play,” Hollist plans to discuss the urgency and challenges business leaders face, and talk about how SAP uses its own technologies and practices to model how organizations can accelerate on the sustainability curve.
To find out more about the conference and register, visit https://www.asug.com/events/asug-best-practices-sap-for-cloud
ASUG interviewed Hollist as a preview his keynote speech, condensed and edited below.
Question: Let's take a step back; tell us what is appealing to you about speaking to this audience and participating in the best practices cloud event?
Answer: That's a good question. Any chance to explain more to SAP clients about sustainability is a great opportunity. The other aspect that intrigued to me is that the focus for this event is cloud. Cloud is in and of itself is, by nature, a sustainability play. The whole process of moving from on-prem and into the cloud plays right into the sustainability goals for any corporation.
I’m not a deep expert on cloud, but I do understand that when you migrate software from existing data centers to cloud environments, energy use is consolidated, and computing resources are maximized. In state-of-the-art data centers powered by renewable energy, cloud computing is even more environmentally friendly. It’s a fun topic to think about: how cloud migration strategy impacts emissions reduction goals in the sustainability strategy. This is a topic some IT people may not even be considering yet.
Q: Will that be the primary area that you're talking about, of creating awareness of cloud as a sustainability play?
A: No, that won't be the only topic. I'll talk about a couple of key things. The [session] abstract talks about why sustainability at all? Why are we going to do it now? Why SAP? Why is sustainability a significant challenge? Why is it a mega-trend that's moving markets? How is it expanding our definitions of corporate accounting, and why is it so data-centric? And then, to top it off, exploring this idea of sustainability as a journey, not a destination.
If you were to ask me, "I understand you've been married for 30 years. How is your marriage?" And if I were to tell you, “Well, I think it's sustainable.” That's not where I want to be. Now remove the relationship example and insert your business. Or, say you ask me, “How's your business you've been running for 30 years?” And I answer, “We're not even sustainable yet.” Again, it’s clearly not where I want to be. There is much more beyond it than just being sustainable. Don’t we want our businesses to be flourishing, impactful, thriving, or vibrant? So we really want to move the needle on all the dimensions of sustainability. Sustainability is just the first goal. It's the bottom rung of the ladder. But because it's such a challenge, we often view sustainability as the final goal and, it's not.
Q: It’s not the endpoint?
A: It's not; it's the first point, the first goal. It's just a long way to get to that first goal. We should have been sustainable all along. It’s imperative to have this mindset. It's like we've got these great sustainability goals for 2050. We're going to be net zero [carbon emissions], and we're going to take better care of our people, and we're going to be more diverse… And we push that out to 2030, 2040, or 2050. The goal is just the starting point.
Q: Other themes you plan to present?
A: As time permits, I will talk about some of the latest regulations coming from the Securities and Exchange Commission. What do they mean for sustainability? And then, I'll use some examples of why sustainability might be important to corporate reputation and how some companies use that as a competitive advantage. Finally, I'll talk a little bit about SAP as an exemplar and as an enabler.
Q: Can you talk a little more about SAP as an exemplar?
A: There are several areas in which SAP sets an example. For instance, we do integrated reporting. Integrated reporting is critical because it means taking your financial information, income statement, and balance sheet in an annual report and including all of the ESG data pertinent to the corporation. It's important. If it's pertinent to the business, then investors ought to know about it.
Q: How long has SAP been doing such reporting?
A: SAP published its first integrated report in 2012. When you do an integrated report, the assumption is that those numbers are accurate, audited, and attested to by a senior executive. This is not the practice of most North American companies. Instead, the practice is to publish only the financials in an annual report, which has all the rigor of data assurance, audit, and attestation. Then they'll do a corporate sustainability report that is not audited. Sometimes pieces of it will be; you'll see the Carbon Disclosure Project has audited the emissions data in the report. That's a good start, but it's not put in the annual report that goes to investors.
An integrated report says we see it all as being important for our stakeholders and shareholders, so it's all audited and attested to because it's going to financial markets. So that's a step SAP takes above and beyond where most North American companies go today.
Q: What do you want your audience, your virtual audience in this case, to remember most?
A: It comes back to why do anything? And why you should act now and choose SAP and for the value we're bringing.
Why do anything at all? Business has significant problems that we are all wrestling with: Emissions, reporting, regulation, over consumption patterns. We have linear business models that take raw materials, make products, and create waste by the garbage truckload. There's a need to act and to change now. We have to take this seriously.
Businesses need to do better across the areas of their people, the environment, and society, or they're going to fail. They need to be leaders. The world is looking to them. Their customers are looking to them.
If you don't take action now and try to do the bare minimum, your competitors might choose the opposite strategy, and you will be left—not just behind—but woefully behind. You can't catch up later. The ecologically and sustainability-minded consumers will simply cause you to lose your social license to operate, and you'll fail. So, I think business has got to engage the rising generation who this stuff is really important to and to their children, to their grandchildren, and great-grandchildren.
And why SAP? Because we are end-to-end across business processes. Sustainability is data-centric. SAP has a wealth of our customer's data, and we run many of their critical business processes. We may not have it all, but we have a lot of it. Sustainability teams are going to rely on SAP's data. They need our business processes to change. They are going to look to our systems to assure data for audit and attestation. A glitzy annual sustainability report produced by corporate communications will be insufficient in the future. It's will migrate over to be controlled and audited by the CFO. That's a very different standard from what we have today. Think about it as the “SOX-ification” of ESG.
SAP has the data and the track record of depth and breadth across all your critical business processes. You're going to rely on that data and will have to evolve those processes to become sustainable. And no one is positioned to do that as well as SAP. We are a great partner for you.