Study: Sustainability Tool Should Produce Complete Reports

Study: Sustainability Tool Should Produce Complete Reports

Heterogeneous data sources, poor data quality and complex regulatory requirements complicate sustainability reporting.

So far, many companies still rely on the on-board tools of large software and cloud providers and thus leave a lot of optimisation potential unused, as the current “IT & Sustainability – Maturity Index 2023” shows. For the study, the market research company PAC surveyed 150 IT and business decision-makers from the automotive industry, the manufacturing industry and the logistics sector on behalf of Lufthansa Industry Solutions.

Calculation of the CO2 footprint

“In order to fulfil the regulatory requirements of sustainability reporting, companies have to collect, analyse and prepare a lot of data. Managing these tasks manually is not only too time- and personnel-intensive, but also very prone to errors,” says Moritz Röder from Lufthansa Industry Solutions (LHIND). For the “IT & Sustainability – Maturity Index 2023,” LHIND has therefore determined a sub-index for the area of “tooling. The sub-index takes into account whether companies create their sustainability report in a tool-based and automated way, whether they carry out a risk assessment of their suppliers and which tools they use for this. On a scale from “0” (immature) to “10” (mature), the sub-index achieved a value of 6.4. “The index shows that companies are already intensively dealing with the topic of sustainability and the tools required for this,” says sustainability expert Röder.

And what does such a tool have to do from the companies’ point of view? In addition to calculating the carbon footprint (93 per cent), 82 per cent of those surveyed want support in making sustainable purchasing decisions and 78 per cent want complete sustainability reporting. For 70 percent, recording the status quo is important to be able to improve sustainability and 61 percent expect a holistic view of financial and sustainability KPIs.

Few companies have automated sustainability reporting

So far, every second company surveyed for the study already produces a sustainability report – either voluntarily or legally required to do so. Four out of ten of these companies still do this manually and are supported to varying degrees by a reporting tool. 44 percent of the companies already produce their report at least partially automatically. Often, tools for sustainability monitoring are used that are already established in the company as part of the software portfolio of large software or cloud providers. But only in 15 per cent of the companies is the report generation already largely automated. Moritz Röder: “Contrary to what the sub-index suggests at first glance, there is still considerable potential for optimisation here.”

The same applies to the risk assessment of suppliers. Two-thirds (67 per cent) of the companies already carry out a risk assessment on the sustainability of their suppliers, and another 26 per cent are planning to do so. Less than a third of these companies have automated this process to a large extent so far. In contrast to sustainability monitoring, specialised tools are usually used to assess supply chains. Röder: “In order to improve their own maturity level and drive automation, companies do not need a bunch of different tools, but a single source of data truth. A tool that guides them step by step through reporting while providing transparency in the supply chain.”

To avoid any unpleasant surprises when implementing the tool, companies should also make sure that it is in line with process governance as well as reporting guidelines and that it can be adapted to both finance requirements and future organisational structures. “If these requirements are met, such a tool ultimately enables the data-based sustainability management that companies need to achieve their climate goals,” says Moritz Röder.