Role of Enterprise Resource Planning (ERP) Systems in Carbon Data Management

Abstract Description: Role of Enterprise Resource Planning (ERP) systems in Carbon Data Management

“You can’t manage, what you don’t measure”, is a term we hear often when it comes to quantifying and managing greenhouse gas (GHG) or carbon dioxide equivalent (CO2e) emissions. It is very apparent that with the upcoming Securities and Exchange Commission (SEC) regulations on climate disclosure and Federal supplier risk and resilience proposed rule, organizations will need to quantify their Scope 1, 2, and in some cases Scope 3 emissions. In the context of Scope 3 emissions across the value chain, it is important to have large-scale data sharing to provide transparency and accuracy.
Many organizations probably already generate majority of the data required to accurately estimate Scope 1, 2, and 3 emissions across the entire value chain. This data is often stored in the organization’s ERP system, primary purpose of which is to provide transparency and increase collaboration across different departments within organizations and with external stakeholders like suppliers and customers. The data streams may include information on procurement of materials, production of goods, logistics data such as inbound and outbound transportation, end-of-life (waste management) data, as well as data related to business travel.
Given the huge amount of master and transactional data that exists already in the ERP system, this can be vastly reused to convert it into CO2e emissions. Integrating this data in a common platform and using appropriate conversions present one of the most feasible approaches for the quantification of CO2e emissions from the value chain perspective. More importantly, once the emissions are quantified using the realistic business parameters, this data can be integrated back into the ERP systems to make business decisions. Using this unified approach around business planning, companies can intelligently make decisions on what raw materials to buy, where to buy the materials from, how to optimize the supply chain, what policies should be developed around business travel and employee commute to ultimately think about their decarbonization approach. Given the uniqueness of each business, its important to provide customizable solutions to carbon data management problems. Many of these solutions can be designed around the ERP system.

In this presentation, we will talk about the role ERP systems play in managing and reporting carbon data and creating decarbonization strategies.