- SAP's on premise and cloud procurement solutions support our company in achieving our sustainability goals.
- Our Global Procurement Organization fosters and encourages sustainability throughout the entire supply chain.
- SAP solutions help make our customers and suppliers more sustainable businesses.
Sourcing from Sustainable Suppliers to Further Improve Our Performance
SAP not only promotes sustainability within the company, but also goes further to work with suppliers in procuring the most sustainable products possible. Throughout, we seek to buy products and services only from suppliers that meet high environmental and social standards. Furthermore, SAP started to partner with the ‘Made in a Free World’ initiative in order to identify and eliminate potential child and forced labor in our supply chain. Such procurement practices help us create a positive impact and provide levers through which we can reduce our emissions. In addition, working with suppliers that demonstrate a commitment to sustainability enables us to comply with the requirements of our own customers and to lead by example as well.
SAP works with a supply chain that supports the development of our software, global operations, and employee base. Our purchases consist primarily of consulting and development services, travel, and marketing, as well as tangible goods related to IT equipment, car fleet, and facilities.
Designing and Updating Policies to Meet the Highest Environmental and Social Standards
To drive progress throughout our supply chain, SAP has made sustainability an integral part of our Global Procurement Policy, to which all procurement employees must adhere. Our goal is making sustainable procurement a seamless part of our Global Procurement Organization, thereby supporting SAP’s overall sustainability goals. This integration involves a continual evaluation of trade-offs among economic, environmental, and social aspects of our sourcing decisions.
SAP makes social and environmental criteria mandatory in the selection process for new suppliers. To help realize these sourcing practices, a section on sustainability has been added to our global master contracts, asserting the right to receive information from our suppliers in advance on labor rights, health, safety, environmental protection, and other key sustainability issues to protect and comply with our daily business with regards to sustainability.
In addition, our suppliers are required to accept the SAP Supplier Code of Conduct. This code is designed to be based on international standards that are relevant to our industry, including but not limited to, the Electronic Industry Citizenship Coalition (EICC) and the United Nations Global Compact. It contains provisions regarding human and labor rights, corruption and bribery, waste, water, air, and materials.
For applicable goods and services, SAP sources suppliers that provide such goods and services on a local basis, for example, for the food available in our cafeterias. In our SAP Innovation Center in Potsdam, for example, we offer regional and local products. By using predominantly local products in our catering, we demonstrate that we support regional agriculture and thus have a positive impact on the environment.
Assessing the Environmental and Human Rights Performance of Suppliers
As part of our supplier management program, within a pilot program running for the USA we ask all new SAP suppliers, just as all our direct suppliers worldwide with an annual spend above € 10k (reached in the reference year 2014) to answer sustainability related questions, which cover their sustainability strategy, dedicated company targets to drive environmental and social improvements, ISO 14001 certification and ensuring of human rights and labor standards. The answers help us to identify risks in our supply chain, as well as areas where we can work with our suppliers to improve performance. We also document the diversity of our suppliers in the United States quarterly.
Our screening has helped to confirm there are no major risks or significant negative impact related to social or environmental performance. As a result, the intervals to conduct additional in-depth impact assessments can be extended. When we identify risks, we assert the right to conduct on-site audits.
Since 2012, we assess the greenhouse gas emissions of our supply chain, and continuously improve our respective methodology to identify and implement opportunities to reduce our collective footprint. For more information on these efforts, see the Energy and Emissions section.
Increasing Employee Incentives to Select Preferred Sustainable Products
We remain conscious about what we purchase to run our business, and make it easy for our employees to do the same. Employees can easily identify and buy sustainable IT and office supplies from our SAP Ariba catalog. We have flagged these products with a “green leaf” to help employees make the right decision when buying products needed for everyday business. The green leaf represents products that are classified according to sustainability guidelines and certifications. For IT equipment, we use the externally accepted TCO Development label that considers not only environmental criteria but also takes into account under which conditions the hardware was produced. In Germany, we have also set up a completely green office supply catalog.
We provide various information on CO2 emissions for business flights during the booking process with our Concur solution. Through this transparency, our employees can reconsider the CO2 emissions of business flights in their decision making process.
Co-Innovating to Benefit Our Suppliers and SAP
Since the beginning of the sustainability team in 2009, our procurement organization has worked closely with key suppliers and internal SAP organizations such as solutions and development to encourage sustainable practices in their respective businesses. We have continued to work directly with suppliers in key areas to ensure measurable improvement:
- Enterprise mobility: SAP offers the option of a full year rail travel ticket in Germany, as an alternative to our company car option.
- Electric vehicles
- Bicycles: SAP has begun offering leased bicycles to employees in Germany. SAP has now leased 1,094 bicycles at the end of 2015.
- Food catering: We defined key performance indicators (KPIs) for food service suppliers at our locations to measure their environment, health, or safety performance, and are exploring and pursuing more sustainable alternatives. At our offices in Germany, for example, our entire coffee and cocoa supply is organic and fair trade. Rollout is planned for selected locations worldwide. Using water dispensers instead of plastic bottles is already standard in most of the locations and should be implemented in all the remaining ones in 2016.
- Renewable energy
- Recycling paper: We now use 100% recycled paper in Germany and in the whole EMEA region. Furthermore, we plan to finalize the rollout globally in 2016, at the latest.
- Paperless invoicing: We are achieving a reduction of 150,000 paper invoices annually by utilizing e-invoicing available in cloud solutions from SAPAriba. Also the travel expense reimbursement process proceeds fully paperless with receipts being scanned by the end users for the countries where original receipts are not needed for archiving.
- Sustainable events: In 2015, some events such as CeBIT in Germany were powered by 100% renewable electricity. In 2016, our SAP Development Kick-Off Meeting (SAP d-kom) will be run as a sustainable event. Together with an event agency, we will create a state-of-the-art approach and define KPIs to measure the initiative.
- Green office materials: SAP now offers alternative environmental friendlier office materials products in their catalogs. These products are marked with a green leaf; on average one third of our office materials purchased in Germany in 2015 is considered green.