Explaining the Role of Sustainability

SAP Sustainability empowers businesses to embed sustainable practices into their core operations, enabling them to achieve environmental, social, and governance (ESG) goals while driving economic growth and resilience. SAP's Sustainability portfolio offers comprehensive solutions for visibility, analytics, carbon footprint management, traceability, transparency, and regulatory compliance. These integrated solutions seamlessly connect with SAP ERP systems, providing real-time data and insights that facilitate proactive decision-making and efficient sustainability performance management. By addressing various facets of sustainability, the portfolio helps organizations streamline processes, reduce costs, and enhance overall operational efficiency, ultimately supporting their sustainability targets and long-term profitability.

The business landscape is evolving, with sustainability at its core—not as a trend but as a global force driving change. Businesses face increasing regulatory requirements, stakeholder demands, and competitive pressures.

Sustainability is a challenge on two fronts: companies face powerful external pressures and equally demanding internal realities. Externally, regulations are multiplying, carbon pricing costs are rising sharply, and stakeholders—especially investors—expect measurable action on climate change. By 2027, new rules in Europe and the UK will make carbon compliance more expensive than ever, and ESG requirements have already grown nearly seven-fold since 2000.

Internally, many organizations still rely on fragmented data, manual reporting, and outdated systems. This slows down decision-making, increases the risk of errors, and makes it harder to deliver timely, compliant, and meaningful sustainability reports. Even as teams strive to meet ambitious targets, they often spend more time gathering information than acting on it.

The result is a constant balancing act: responding to fast-changing external demands while overcoming internal barriers. Companies that can close this gap—by improving data quality, streamlining processes, and integrating sustainability into core operations—will be better equipped to comply, compete, and lead in the transition to a more sustainable economy.

Business leaders across all functions are integrating sustainability into their strategies, tackling challenges such as compliance costs, supply chain resilience, and data integration. Under the CSRD framework, key performance indicators like carbon footprint calculation and reduction, supply chain emissions, and energy efficiency are crucial for long-term success. To address these priorities, businesses are transforming processes to cut costs, mitigate risks, and future-proof operations. An ERP-centric solution plays a vital role in unifying efforts, tracking KPIs, and enabling sustainable growth.

This challenge spans all lines of business, and each C-level leader has a distinct role in meeting it. For CFOs, carbon has become a financial liability—one that must be managed and reported with the same discipline as any other balance sheet item. They are now key strategic advisors, guiding the business to achieve both profitability and sustainability compliance. COOs ensure that operations and supply chains are sustainable, resilient, and capable of predicting and preventing risks. The Chief Sustainability Officer—whether as a standalone role or within the CFO or COO remit—aligns all functions toward shared sustainability goals, manages sustainability risks, and identifies opportunities for innovation and growth.

Achieving these goals requires collaboration across the organization, powered by accurate, accessible data and smarter technology. When all functions work together—speaking the same data language and sharing the same sustainability objectives—businesses can transform compliance pressures into competitive advantage.

Now let’s talk about how SAP helps the C-Suite and their organizations to not only meet their sustainability goals—but to embed sustainability into the core of their operations, ensuring long-term resilience and growth.

SAP Sustainability solutions are built around integrated, ERP-centric capabilities that enable customers to drive four sustainability priorities:

We start with three core outcomes for our customers: Manage Risk, Achieve Compliance, and Unlock Value. We help you anticipate and mitigate risks, automate and streamline compliance, and turn sustainability into a driver of growth, innovation, and resilience.

These outcomes are delivered across four focus areas: Sustainability Management to set strategy and track progress, Carbon Accounting to measure and connect emissions to finance, Sustainable Supply Chain for transparency and ethical sourcing, and Operational Compliance to meet global and industry standards.

What sets SAP apart is our Suite-first, AI-firstapproach. Sustainability is built into business processes with real-time applications, powered by a trusted data foundation, and enhanced with AI for automation and smarter decisions. The result: measurable sustainability outcomes, delivered at scale.

SAP Sustainability solutions are primarily cloud-based, in order to provide integrated capabilities for tracking and mitigating the various sustainability challenges, while supporting opportunities for implementing new sustainable business models, such as circular economy.

In addition, with the fast-paced changes to sustainability legislation in different legal jurisdictions (schemes for extended producer responsibility (EPR), laws about human rights due diligence, emissions reporting requirements, and so on), cloud-based solutions can ensure that the necessary reporting capabilities remain up-to-date.

Integrating sustainability as the best of Business Suite into every SAP cloud ERP solution ensures customers can fully leverage its comprehensive benefits. This approach enhances SAP’s portfolio, including SAP Business Technology Platform technologies like SAP Datasphere and SAP Analytics Cloud, while accelerating cloud transformation and positioning customers as sustainability leaders. For businesses navigating legal requirements, SAP solutions like SAP Responsible Design and Production enable seamless tracking and reporting of sustainability indicators, such as recycled packaging components, which are critical in jurisdictions with extended producer responsibility (EPR) tax implications.

As global EPR schemes become increasingly prevalent, simplifying tracking, modeling, and legal reporting is essential. SAP Sustainability solutions, such as SAP Sustainability Control Tower, empower customers to meet EU taxonomy requirements and extend to voluntary frameworks, streamlining sustainability reporting through interoperability. By embedding sustainability insights into core ERP processes—supply chain, procurement, finance, and sales—SAP delivers a unique value proposition that goes beyond regulatory compliance. This ERP-centric approach unlocks unparalleled sustainability insights, setting SAP apart from competitors and solidifying its leadership in sustainable business transformation.