Three years ago, software provider SAP was informed by one of its customers, a large European telecommunications company, that their business relationship would cease unless SAP produced a report detailing its energy use and greenhouse-gas footprint. A growing number of companies headquartered in Europe, as SAP is, were producing such documents along with their traditional annual reports. “It went from a nice-to-have to a must-have,” says Rami Branitzky, the managing director of SAP Labs North America.
The company, which is based in Walldorf, Germany, not only created the report but also set an ambitious goal of cutting its global carbon emissions in half by 2020. In 2009 alone, it was able to cut emissions by 15 percent, saving 90 million euros (about $120 million). The emissions reduction—the equivalent of taking 50,000 cars off the road—was achieved in large part by changes in behavior at the $15 billion company, including cutbacks in air travel. SAP’s internal savings, however, are just the beginning. The company calculates that its 105,000 customers in 120 countries collectively account for one-sixth of global carbon dioxide emissions. If those clients could be helped to make similar cuts, Branitzky says, the environmental benefits could be immense—and SAP could reap new business in the process, since it creates and sells analytical software that lets companies monitor their own carbon footprints and increase their energy efficiency. According to SAP’s own estimates, the market for “sustainability software” will reach $7 billion within five years. “They’ve really taken the ball [on sustainability software] and are running with it faster and harder than any of the large players,” says Warren Wilson, an energy and sustainability analyst at the London-based market research firm Ovum.
To highlight the reductions in its own carbon footprint, SAP recently showcased five efficiency initiatives at its campus in Palo Alto, California. The projects included installations of LED lights and solar panels. The company also overhauled its data center and has begun purchasing a fleet of electric vehicles and charging stations.
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