In recent times, SAP has been woo’ing me down the governance, risk and compliance (GRC) path. To its credit, the company has done a lot of good work in this area, seeking to develop industry alliances and raise awareness of the issues at stake, especially in the area of corporate citizenship. Most recently, James Farrar, who is VP corporate citizenship at SAP and Steve Rochlin, head of Accountability US managed to get a good article on the topic as it relates to Web 2.0 placed at the FT. Among other things, they say:

A decade ago if you brought together a company, an activist non-governmental organisation (NGO), and a government agency, you were guaranteed to create tension. Today, these oddly matched partners generate innovation out of positive, creative tension. Web 2.0 platforms make it easier to build such diverse communities that use different experience and perspective to create innovative solutions.

A couple of days ago, I received an SAP email newletter with the tantalizing headline:
Achieving Corporate Accountability with a Unified Approach to Governance, Risk, and Compliance Webcast. On the webcast David Kasabian, analyst with AMR reckons the market is worth $32 billion per annum. That makes it a good sized market. Holly Roland, VP marketing for GRC solutions at SAP talked extensively about managing the risks in the supply chain - something I’ve talked about elsewhere.

Imagine then my surprise when a June 2008 report from Gartner entitled Magic Quadrant for Enterprise Governance, Risk and Compliance landed on my digital doorstep that doesn’t list SAP. The company doesn’t appear anywhere although one of its partners, Protiviti does. Marketing ahead of reality, an unfortunate omission or something else? SAP has reached some 1,700 customers with GRC solutions and seen revenues double over the last year.

[Image credit: Gartner Inc.]

PS: I expect to hear a lot more about how the BusinessObjects acquisition is feeding into SAP’s GRC efforts at the forthcoming influencer’s meeting in Boston next month.

I haven’t used a printer from more than three years. Part of that is because I’ve been conducting an experiment to see if I can ‘live in the cloud,’ part of it is because almost everything I do is digital in nature. The only time I really need to print something is when an organization insists on a faxed copy of a document and even that’s becoming quite rare. On those occasions, I drive 20 miles to the nearest place I know where there is a fax machine and make a day of it. It’s not efficient and hardly good use of increasingly scarce hydro-carbons but a good reminder that not everyone has jumped into the digital age.

Even so, I took a sharp intake of breath when I saw a post from my old chum Vinnie Mirchandani, setting out ways by which companies could mitigate their use of ink cartidges. At an alleged $8,000 a gallon, that’s a heck of a price to pay for the pleasure of holding a piece of paper. And that’s before we consider the costs asssociated with manufacturing the catridges and the toxins they produce.

I remember many years ago, Bill Gates saying that Microsoft would become paperless and yet today by all accounts, it uses more paper than ever. In my case it was a conscious decision to ‘just say no.’  With more applications going online into the SaaS world, I don’t see the justification for keeping paper copies of everything we do. Perhaps now is the time for business to dust off those old document management strategy papers and re-evaluate the need for printers, the paper and ink they consume.

Last week’s launch of the iPhone seemed to get everyone excited to the point where queues formed early at many stores that quickly ran out of stock. What if you are an early adopter and already had a first generation model? Give it to a sibling? Dump it? What do you do with old cell phones anyway?

Here’s something you could think of doing, courtesy of Suw Charman: donate to your local Oxfam shop. Apart from being a socially repsonsible thing to do, it means that money raised via Oxfam goes to good causes. Another alternative suggested by an AMR analyst is to donate to local battered wives homes. All cell phones can call emergency services so this is a way where your riches can directly benefit those less fortunate.

While on the topic of good causes, my good friend Thomas Otter, ex-SAP and now with Gartner is planning to spend a week in August putting himself through what to me seems like an excruciating amount of pain in an effort to raise money for the Zimbabwe Benefit Foundation. Modern technology allows anyone to donate painlessly. This is one cause I thoroughly recommend. As I said elsewhere:

The pain he will be putting himself is as nothing compared to the pain of those he is supporting. He gets to choose. They don’t.

And while we’re at it, it’s worth mentioning SAP. Its community of more than 1.5 million code heads and business process experts creates blog posts and wiki content at a phenomenal rate. Each piece of individual activity on the SAP Community attracts a certain number of points. This year those points are going towards a specific target. When the number of points earned reaches 2.5 million, SAP will donate €100,000 to the UN World Food Programme. The more points, the more money given. If the total reaches 3.5 million points then SAP will give €200,000. Apart from being a laudable objective, the knowledge created inside the SAP community is an invluable resource to those looking for help across a broad range of topics.

Disclosure: I am a mentor in the SAP community. It is a pro bono engagement. I create some content for SAP’s BPX community on a paid basis.

Eddy de Clercq is my kinda guy. A software engineer who works at a Belgian university, Eddy is widely known among his community for his sharp wit and incisive points of view. He makes the kind of connections many miss and tries really hard to live the sustainable life. This from a recent post about bottled water:

I’ve seen somebody drinking O2 water the other day. Not only it had artificial kiwi and apple flavour but also extra oxygen added. According the ‘manufacturer’, it uses patented technology from Life Technologies, Inc. to put extra oxygen into ordinary water. The resulting beverage has 10 times more oxygen (72mg) as ordinary water and provides an extra boost of energy by increasing the amount of oxygen in your blood. What a load of crap! Who needs this kind of water anyway? Nobody compos mentis does.

Eddy then goes on to rant about the resources that go into producing different kinds of bottled water and the impact it has on the environment. Given that our industry uses a LOT of water, not just to quench our individual thirst but also as a resource for data centre cooling, should we not give this apparently innocent aspect of our lives greater consideration?

Eddy has been helping me out on a sustainability project I am working upon. He may be The Grumpy Old Man, but he’s got a heart of gold. How many others might you know who fall into that category?

On a related economic note, my wife told me that a 500ml bottle of Pennine water in a local supermarket cost her 39p. The same bottle in a shopping centre not five miles distant was £1. I know there’s money in O2, I just didn’t realize there is quite so much.

Courtesy of my old mucker James Governor, I see McAfee is leading the charge in greening up its events. Reporting about a recent conference held in Las Vegas, McAfee made sure it was as close to being carbon neutral as possible. By the numbers:

In support of its environmental commitments, McAfee took steps to “green” the event in advance. According to ICF International’s measurement, through a series of event planning decisions and participant education efforts, McAfee reduced the event’s carbon footprint by 16% of its total non-air travel emissions. Specific CO2 emissions savings included:

• 25 metric tons saved by facilitating the sharing of rooms by participants
• 3.2 metric tons and 56,357 gallons of water saved through participation in the hotel’s towel and sheet reuse program
• 0.5 metric tons saved by providing a shuttle for airport and event transfers rather than travel by individual taxicabs
• 0.5 metric tons saved by eliminating bottled water and providing tap water only

“Companies who are committed to sustainability and minimizing their environmental footprint must first understand where their material impact can be made,” said Craig Ebert of ICF International. “For companies in the knowledge economy, often that material impact is in their electricity use, business travel and corporate events. We applaud McAfee for its industry leadership in corporate sustainability by conducting this in-depth measurement project, taking steps to reduce and offset the environmental impact and being transparent in sharing the results with others for the common good.”

Among the overall findings of the formal measurement project of the remaining environmental impact:

• The carbon footprint of the overall event was approximately 1,856 metric tons of CO2, or 1.03 metric tons of CO2 per event attendee
• 90% of the event’s carbon footprint resulted from air travel to and from the event
• Excluding air travel, of the remaining 10% of the event’s carbon footprint, the breakdown was as follows: food (35%), hotel rooms (33%), amenities (19%), facility use of hydrofluorocarbons (HFCs) (5%), solid waste (4%) and the event’s conference center (3%)

MacAfee used carbon offsets to compensate for the travel element, contributing to a reforestation project in Louisiana.

Ironically, James Governor’s Greenmonk is holding an Energy Camp unconference next week - in Las Vegas.

Business travel among software companies is a major contributor to CO2 emissions. One of the ways to overcome this is to organize virtual events. Like the one I recently ‘attended’ along with more than 2,000 SAP employees. Savings amounted to 724,000 km in travel alone for the three day event.

I was saddened to read Miya Knights report that significant number of UK IT managers are confused or in the dark about the greening of IT. What’s worse is that:

The Datamonitor survey of 245 CIOs and IT managers found over 75 per cent considered eco-friendly computing as an important element in their IT strategy while a further 15 per cent rated it as their top IT priority.

Why should this be worse? If something is top of agenda then you’d have thought that people would know what they’re talking about. In any event, I’d argue that the baseline argument is not about ‘greening’ but sustainability. There is a huge difference. Earlier, Miya reported that:

But most of those with an existing policy (85 per cent) were more likely to outsource IT functionality. Although only 27 per cent insisted on checking the green credentials of a supplier, a further 21 per cent admitted to having no knowledge if such checks were even in place.

“Faced with these findings one has to question the current ethics of outsourcing green IT,” said Antony Young, director of Bell Micro’s services, security and networking divisions.

With respect to Mr Young, it’s not a question of ethics, unless of course he is implying that by outsourcing, UK IT managers would effectively be moving the problem from one place to another. That seems to be the implied assumption in what followed:

“It is also worth remembering that if green IT does become subject to legislation it is highly unlikely that such unregulated outsourcing would be acceptable,” he added. “UK businesses clearly must introduce more vigorous vetting procedures when outsourcing to third party organisations. What is apparent from these findings is that IT departments require a quantifiable green education and structured response.”

Legislation is NOT the answer. I am currently engaged in a project where the notion of sustainability is being baked into ideas around business process software. Business is not going to adopt sustainable measures unless it sees a tangible business benefit. Simply mandating that companies do X or Y is not the answer. You only have to look at the extractive industries to realize that the number one agenda item has not been sustainability but about the extent to which companies can push the boundaries without getting caught.

My group is proposing (among other things) that developing assurance measures that become part of provisioning processes, you encourage the business to measure and assess its sustainability credentials in a constructive and structured manner. Moving forward, we believe that assurance will provide a pathway to external assessment and audit that can usefully adopt techniques designed to assess materiality in the same way that auditors use the term when testing financial statements. Our view is that by looking at sustainability from an end to end process perspective, companies will have a far clearer picture of the impact they have, both directly and indirectly on the resources they consume. We believe this approach will work well in a horizontal fashion across a variety of business processes. However, the real challenge will be in assessing the materiality elements for any particular business. So while it is convenient to pick on IT, it may not be the primary focus in industries where consumption of water (as an example) is a significant ecological drain. Unless your name is Google.

A recent report entitled The State of Green Business, 2008 is packed with facts and figures that make heartening reading for anyone concerned with governance.

I was particularly struck by the laggardly growth in CSR reporting, that despite:

Customers, investors, and stakeholders are demanding increasingly greater accountability and transparency from companies on environmental and social issues. They want to know what companies are, and aren’t, doing, warts and all.

The report says that even though the Global Reporting Initiative is now reasonably well established, growth in meaningful CSR reporting has barely grown 50 per cent among Fortune 100 companies in the US in the last five years. That’s around two-thirds of the total that could be reporting. Among those reporting since 2002: Intel, HP and Motorola. The report says that:

Initially, companies largely focused on environmental, health, and safety indicators because those were areas where regulations already required disclosure. But the GRI forced many corporations to look more broadly at other areas of corporate policy and performance, such as product responsibility, supply chain issues, sourcing, governance, diversity, and social issues.

When I survey the reporting scene, it is apparent that many companies find it very difficult to figure out how the framework applies. In Doing Good: Business and the Sustainability Challenge, companies are said to be “at the baby steps stage” as concerns sustainability issues because “business people recognize their importance, but when it comes to the practical question of what they mean to the organization, there is a lot of confusion”. Ever that was so. James Farrar put a more positive gloss on the report:

If I am to make one criticism of the EIU study it is that it did not go far enough to explore strategic value drivers by key industry to drive a more granular debate on strategic sustainability management…

So what does this mean for the tech sector? In many respects the sustainability pioneers of the private sector came from the extractive industry and often borne out of crisis. Sustainability 2.0 will be driven forward by innovation and market forces. Business models will be reinvented to tap into more environmentally efficient and socially inclusive markets. For sustainability 2.0 to be successful more will be demanded of the entire tech industry in serving as both exemplar and enabler.

I hope James is right but given the difficulties we are already seeing in operating a framework that has horizontal meaning, let alone in verticals, it seems there is a long way to go. The software industry could point the way, offering standard methods of arriving at certain measures. Right now that’s being tackled in an ad hoc manner and I would prefer to see the major players coming together and picking off relatively ‘easy’ measures as examples to pave the way. Whether we will see that kind of cross party meeting of minds is another matter.

What I am confident is that as a market, CSR and GRC combine could well be larger than the ERP market.

The other week, I kicked off a debate at SAP’s developer and business community that was described by some as ‘provocative.’ To cut a long story short, I was pointed in the direction of an appalling story about the use of slave labour in Jordan by a supplier to Victoria’s Secret. That company’s parent is Limited Brands. SAP supplied the specialist software to run Limited’s global supply chain, several years before the human rights abuses became public. The provocative part came where I wondered what a secondary supplier - in this case SAP - might do given it has an active CSR group that is attempting to frame a series of responses to issues in which the group is interested. The responses that followed were interesting and thought provoking. That’s a start.

As a freelancer writer, I am in a privileged position. I am not constrained by the terms of service that employees need to observe when it comes to commenting on corporate policy. At the same time, I am aware that raising such issues is bound to cause some head scratching. Any company that supplies the Global 2000 will at some stage cross the path of those who are less than scrupulous. When it does, then it needs to frame a sensible response. Pointing to the principles to which it holds itself accountable somehow doesn’t seem enough.

I’m often highly critical of companies’ CSR efforts. Too often they’re little more than fine sounding words on a back page of the financial statements. Nowadays, issues such as climate change, sustainability and accountability are becoming harder to avoid. Companies that continue to say plenty and do nothing will increasingly find themselves roundly lashed by those who demand change. In this case, SAP employees took what I consider a brave stance.

James Farrar, who leads SAP’s CSR effort said to me in email:

We’re on the same wavelength…This is a hugely complicated area but its as important as climate change in my view. In fact, many would argue that problems like climate change can only be unlocked by human rights.

He is right on all counts. And therein lies the problem. Just how much ‘power’ does a secondary technology provider truly have in these situations? At this point precious little. But that is not an excuse for inaction.

Marilyn Pratt, who is an evangelist in SAP’s business process expert community who has an unabashed kibbutznik view of the world with the emphasis on sharing expanded on my general line of thinking, coming up with the start of an action plan based upon From Corporate Responsibility to Backstory Management:

So this is a call to action: “the path to really managing your backstory runs through big visions, hard targets and open admission of shortcomings. Shoe manufacturers should work to envision a boldly responsible shoe, one which not only incorporates their ambitions about the future of footwear, but also encompasses the cutting-edge standards in ethical behavior: a shoe, say, that has a one-planet ecological footprint and meets the highest possible labor standards. That company should share the vision of that shoe with every one of its customers.”

As a company/community of knowledge workers, what kind of visions, behaviors and yes, shortcomings, do we wish to share?

Even if the truth is “inconvenient” we had better embrace it and acknowledge our responsibility in the value chain. And yes that means all of us: stakeholders, individuals, employees, and organizations alike. None, it would seem are exempt.

When I wrote the original piece, I was well aware of the risks I was taking. At present, SAP involves me in many of its initiatives, sometimes on the record, sometimes not. Taking a prod at companies of this size can quickly get you shoved to the back of the ‘interview request queue’ as I have found in the past. The fact SAP employees not only responded, but are taking a pro-active stance (see RESIST as an example) on a broad range of issues is not only inspiring but thought leading. This in a further email from James Farrar:

Best practice in this area is concept of sphere of influence and so stakeholder demand then usually focuses upstream rather than down where for the most part the vendor has no power or legitimacy to police the extended actions of its customers. Obvious exceptions here is when the product itself is inherently problematic eg. alcohol, tobacco, firearms, porn but then again focus is once more usually on the production process and features of the product itself to make it inherently less harmful.

In the next few days, I will be meeting senior SAP executives at its upcoming GRC 2008 conference to discuss these issues. It will be interesting to hear their thoughts and engage in what is bound to be a fascinating series of conversations.

RyanAir, the airline I love to hate is in hot water. Not content with running a business that feels more like an overpriced mobile shopping mall, RyanAir has been ordered to withdraw an advert deemed socially unacceptable by the Advertising Standards Authority. The advert, which featured a model clad in attire more like you’d expect to see on a porn DVD cover, was run in the the Herald, Daily Mail and Scottish Daily Mail. It prompted 13 protests. This from the BBC:

After an investigation, the watchdog ruled the advert breached the advertising code’s rules on social responsibility and decency.

“We considered that her appearance and pose, in conjunction with the heading ‘Hottest’, appeared to link teenage girls with sexually provocative behaviour and was irresponsible and likely to cause serious or widespread offence,” the watchdog said.

RyanAir, refused in what has become something of a pugnacious attitude towards any regulator. It claimed the Advertising Standards Authority was acting as censor. Neville Hobson, quoting from responses to the report views RyanAir’s cavalier attitude characterises the episode as something of a PR disaster:

It also displays a little arrogance where some humility might go down better: referring to the regulator as a “bunch of unelected self-appointed dimwits” is hardly going to get you much sympathy.

Commenters to Neville’s post broadly agreed. They said however that in the end, RyanAir’s posture almost guarantees they get plenty of free media coverage (sic) but that people will still check out their prices and book flights.

It seems to me that if a company doesn’t care then it is difficult to see what can be done. The obvious answer is massive financial penalties embodied in law with no right of appeal. Some will argue that smacks of interference. Maybe so but if that’s what it takes to bring a brand into line then I’m for it.

Perceptions matter but when management chooses to stick two fingers up at regulators, then you have to wonder who is the more cynical. The brand or those who buy from them? More to the point, if it doesn’t cares about who may be offended by its advertising, then what other liberties might it be taking?

In the meantime, I try hard to avoid flying with this airline. It blames government at every turn for higher airfares yet often seems determined to wring the last penny out of its passengers.

Last year, Shai Agassi, best known as SAP’s product leader became impatient at the thought of waiting five years for the top job. He left and turned his attention to alternative fuels. Last week at DLD in Munch he met up with an old friend of mine Mark Charmer who leads the eco-group The Movement Design Bureau. Mark isn’t impressed by past credentials and that shows up clearly in his blog post about their discussion:

When we talked on Tuesday in Munich, Agassi demonstrated naivety on the complex interplay of social and cultural factors changing how people move. His rhetoric is full of the need to power the commute, but any argument that information technology is dramatically changing structural factors shaping where, when, why and how we work gets short shrift:

“I’ve worked in a company [SAP] where, if the telecommuting office would have worked I wouldn’t have needed to travel four million miles in six years.”

Well that’s nice, but as he himself says, techies often don’t address the whole problem at hand, just a few pieces. It’s a cheap and blinkered dismissal that shows a lack of understanding of the deep structural changes underway in how technology supports work, commerce and lifestyles.

Wow - not many would take Agassi on in this way and expect to get away with it, but Mark’s point is well made. Even Agassi’s own supporters point up that technology alone is not enough to change the way people think. In comments to an Agassi blog post on ‘go to market’ messaging, Oded Roth notes of past efforts in France:

The concept known well as Personal Rapid Transit was developed quite successfully by a modest team of French engineers and was supported by the French government. The main problem that impedes the implementation of this marvelous idea up today is social more than technological. The common ground to the PRT idea and yours is the trial to attack transportation problem from the infrastructure front rather than the car technology, you are deep in a social and political start-up.

I’m sure that any right minded person will want to find solutions to the deep rooted problems of depleting energy resources but both Charmer and Roth are correct - it’s about attitudes. In Israel, where Agassi’s Project Better Place is being launched Charmer observes:

Alongside Israeli Prime Minister Ehud Olmert and Renault / Nissan’s CEO Carlos Ghosn, Agassi announced, a spectacular and audacious agreement on Monday to deploy a new kind of electric power network and set of cars to run on them that will get Israel’s car drivers off oil as quickly as possible. It’s consistent delivery on his October deal, when he raised $200 million from Israeli Corp and VantagePoint Venture Partners.

Audacious is right. Agassi’s vision of a networked infrastructure providing battery pits stops similar to gas stations is only part of the story. As Tesla Motors has found, delivering electric cars is an issue in its own right. Let alone convincing the buying public that green kudos is worth having a limited driving range.