European Sustainability Reporting Standards(ESRS) Journey With SAP Sustainability Control Tower(SCT)

[Pardhasaradhi_Reddy_Chelikam]

SAP Sustainability Control Tower (SCT) is designed to support organizations in ESG (Environment, Social, and Governance) reporting journey by providing a set of pre-defined metrics aligned with the European Sustainability Reporting Standards (ESRS).

This blog provides a broad outline of how an organization can kick-start their European Sustainability Reporting Standards (ESRS) journey using SAP Sustainability Control Tower (SCT) with confidence.

As part of August, 2024 release, SAP introduced "SAP Sustainability Control Tower ESRS Starter Pack" functionality with ESRS metrics.

Before we dive in, let us understand a bit about European Sustainability Reporting Standards (ESRS) and Its purpose.

The ESRS are a set of extensive standards with regard to Environment, Social, and Governance (ESG) aspects and aim to bring more transparency, accountability, and responsibility with regard to organization`s environmental and social impact. ESRS metrics have been organized into 12 extensive standards which includes, Cross-Cutting Standards, Environmental Standards, Social Standards, and Governance Standards, i.e.

• Cross-Cutting Standards: (S1)General Requirements and (S2)General Standards
• Environmental Standards: (E1)Climate Change, (E2)Pollution, (E3)Water and Marine Resources, (E4)Bio-Diversity and Ecosystems, (E5)Resource Use and Circular Economy.
• Social Standards: (S1)Own Workforce, (S2)Workers In the Value Chain, (S3)Affected Communities, (S4)Consumers and End-Users
• Governance Standards: (G1)Business Conduct

Mini Note:

Please bear in mind that the transition of ESRS journey with SAP SCT is underway and this blog highlights on how we can manage and feed the data to generate ESRS report with regard to sustainability metrics within SAP SCT using ESRS Starter Pack.

let us dive-in...

• Data Management and Integration:

Manage Master Data: Using his application organization can import master data from CSV files, setting it apart from SAP-Provided master data. Once we import, validate and publish, the import status becomes "Published".

for instance let us look at published data for a Business Location and Energy Carrier dimensions,

Dimension - Business Location

Dimension - Energy Carrier

 Now let us configure sustainability metrics relevant for ESRS using "Manage Metrics" app.

Sustainability Metrics

 while setting up the sustainability metrics, we have to provide assurance information. 

• Data Sourcing:

Post metric set-up, let us upload actuals using Manage ESG Data app. At this juncture, organization has got many opportunities to bring the calculate data into SCT application. We can import data either using CSV files or Import from other SAP systems , viz: SAP Datasphere, SAP Sustainability Footprint Management, SAP EHS Management.

If you want to understand how organization can calculate and import GHG emissions, dive into my latest SAP EHS-Environment Management and Sustainability Control Tower blogs, they will give a broad outline of GHG emissions calculation procedure and Import strategy to be considered to import GHG emissions into Sustainability Control Tower. My blogs as follows:

• EHS - Environment Management, Emission Management Part-1 
• EHS - Environment Management, Emission Management Part-2 
• EHS - Environment Management, Emission Management Part-3 
• SAP Sustainability Control Tower-Import Greenhouse Gas Emissions from SAP EHS Environment Management 
• Addendum to SAP Sustainability Control Tower-Import Greenhouse Gas Emissions from SAP EHSM-EM 

In this blog, I have considered below mentioned measures to demonstrate ESRS report generation from SAP Sustainability Control Tower (SCT).

Measures

 Import Actuals:

Import Targets:

if we activate metrics for performance management, post actuals and targets import, we can view the performance of the sustainability metric.

Sustainability Metric Performance

• Reporting and Analyses:

To feed the data into the report, let us navigate to ESRS Starter Pack report tile on the SAP Sustainability Control Tower launchpad.

ESRS Reporting

 

On the tab "Process Management", all the relevant activities are displayed that must be performed to get the results for all ESRS metrics and to analyze in detailed view.

For results calculation, run the activity  to read data from SCT source and calculate metrics. Now we can leverage the above shown dedicated views to access the result to report out in a table format using preconfigured layouts. We can also leverage the given options to pivot data and drill down into more details to gain additional insights. Let us access the results for our sustainability metrics by selecting option "View All Results",

then navigate to the "show data" screen,

let us use the column section to select the characteristic fields and key figure to filter the showed data.

Drill down to the ESRS standard

let us have a glance at overview tab and generate ESRS report for 2023 year.

Assign year 2023 to the report

Then system generates the ESRS Disclosures for the reporting year 2023.

ESRS Disclosures for the reporting year 2023

Now, let us spend some time to look into greater insights of ESRS Disclosures from the above report,

let us drilldown further on Climate Action aspects: Using general section of the side bar menu, input the desired values with regard to reporting year and business location, etc.

like this we can drilldown further to view the results of each ESRS standards. Now let us look at graphical representation of one of the ESRS standards.

This brings me to the end of my process walk-through. If you would like to keep up on SAP Sustainability Control Tower updates, follow me on SAP Community and LinkedIn. I hope this blog proves useful to Sustainability and Environmental Management team.

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Yours Sincerely,

Pardhasaradhi Reddy.C

My LinkedIn Profile: www.linkedin.com/in/pardhreddyc