Sustainability and Performance Management

For the 2011 New Year, I'm sure many individuals and organizations have resolved to become more "green" right?  Well, one of the more interesting uses of Enterprise Performance Management (EPM) and Business Intelligence (BI) technologies I've seen recently is in the support of sustainability reporting and management.  Also known as the "triple bottom line", sustainability reporting is the reporting of environmental, social and economic metrics to key stakeholders; including customers, partners, employees, community members and investors. 

While this type of reporting is mandatory in some countries, many organizations around the world are voluntarily trying to become more responsible in their energy and water usage, greenhouse gas emissions, social and community programs.  They are also collecting and reporting this information to provide their stakeholders a better sense of the impact a company has on the environment and the regions in which it operates. 

Customer surveys and discussions indicate that most organizations start out using spreadsheets, text documents and email to collect and report this information - especially if it's only being done once per year for external reporting purposes.  But as the need for this type of reporting becomes more frequent, organizations will look for software solutions that can support a more easily repeatable process, while providing a higher level of quality and confidence in the data being reported.  This is especially important if the data is subject to external auditing and assurance.  While there are some specialized applications emerging to support energy, carbon and sustainability reporting - more organizations are starting to leverage their existing EPM and BI solutions to address the collection and reporting of sustainability metrics.

One example is Dong Energy, an energy company in Denmark.  Dong Energy had been using spreadsheets and email to collect and report their sustainability metrics and had data quality issues.  With Oracle Hyperion Financial Management, they now have a single system that aligns their financial and non-financial/sustainability reporting and has improved the quality of this data.  Here's a link to a recently-published case study on Dong Energy.

 http://www.oracle.com/us/corporate/customers/dong-energy-1-hfm-grn-snapshot-198750.pdf

Beyond the published, annual sustainability reports many organizations post on their web sites, some organizations are going further and updating and publishing sustainability goals and metrics on a more frequent basis.  One example is SABMiller, who has something called the SAM Reporting Portal (Sustainability Assessment Matrix) available to external stakeholders.   The site includes interactive reports and charts that allow stakeholders to view sustainability performance by region, and subsidiary. 

http://www.sabmiller.com/index.asp?pageid=1709

Lastly, although sustainability reporting is mostly external in nature, this information can also be leveraged for internal purposes.  A good example here is Fitness First, the largest global health club and gym operator.  They are using Oracle BI and an application from Oracle partner Knowledge Global, to automatically collect and report energy data from sensors and meters across 95 gyms in Australia into a consolidated analytics dashboard.  They use this data to establish accurate baselines, create benchmarks across facilities, measure the improvements and help forecast savings into the future.   This consolidation of energy data also supports Fitness First's mandatory greenhouse gas reporting to the Australian Government for the coming financial year.

http://knowledgeglobal.org/index.php

Whatever approach you decide to take, organizations can derive strategic advantage by embracing sustainability as part of the business and disclosing the details of their sustainability efforts to external stakeholders. The benefits include cost savings by limiting waste and consumption of natural resources, enhanced brand value and reputation with customers and partners, better risk management, the ability to attract capital from "green" investors, and the opportunity to attract better staff by offering a great place to work.  Here's a link  to additional information about Sustainability Reporting on Oracle's web site:

http://www.oracle.com/us/products/applications/green/054225.html

Whether you believe in climate change or not, "being green" conserves valuable resources, saves money, and makes good business sense for individuals and organizations.  And it's a great resolution for the New Year.  So go for it!

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This blog will highlight key EPM market trends, recent events and other news of interest to our field, customers and partners.

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