Stephan Müller: 0:00

So we not only can forecast finance numbers, we can now also forecast CO2 numbers on real actual business plans on, on actual sales plans, on material resource plans, on production plans, right? Not only to use this in order to forecast what will be my revenue or what will be my margin in the next years, but also what will be my CO2.

Tom Raftery: 0:20

Good morning, good afternoon, or good evening, wherever you are in the world. This is the Climate Confident podcast, the number one podcast showcasing best practices in climate emission reductions and removals. And I'm your host, Tom Raftery. Don't forget to click follow on this podcast in your podcast app of choice to be sure you don't miss any episodes. Hi, everyone. Welcome to a special episode of the Climate Confident podcast today, sponsored by SAP. And my special guest on the show today is Stephan. Stephan, welcome to the podcast. Would you like to introduce yourself?

Stephan Müller: 0:57

Yes thanks a lot, Tom excited to be here. Yes. I'm Stephan, Stephan Müller. I'm a solution manager from SAP and coming from the finance organization from SAP and in the finance organization of SAP, I look particularly on the topic on how sustainability is influencing the role of finance and is that also eventually our solutions.

Tom Raftery: 1:16

Interesting. Stephan, we're close to 200 episodes into this podcast at this point. And I'm pretty. Sure, this is the first time I've had a finance person on the podcast. So, I can see how finance, I mean, I had someone on recently talking about sovereign wealth funds, for example, but that's not what we're talking about here today. I've had people on, talking about other finance adjacent topics, but your finance finance like accounting. So what's the relationship between accounting finance and sustainability?

Stephan Müller: 1:55

Yeah, I think that that's a very good question. I mean, we are, we are a strong believer that also accountants can put in their share to, to make this world a better place, first of all. Right. And not only from that angle, I, we also believe there is a true transformational change going on and, and will go on in finance departments, right. Especially in the area of the CFO. Let it be right to the upcoming regulations that, that we likely all know, right. In Europe is the Corporate Sustainable Reporting Directive, but not only in Europe, we see this globally across industry, which will have a change on finance departments, right. Because all of a sudden you, you're not only responsible for the, finance numbers, you know, all of a sudden you have hundreds of new data points you need to take care about. And also report externally, but I mean, we also believe it it's not only about regulations and compliance. Right. We also see a shift in the role of CFO as companies set up new sustainability strategies. Right. I mean, in many industries, those are acknowledged a competitive advantage. If, if you have more sustainable products. And also for those, the CFO needs to provide numbers, needs to provide the information, needs to set up the operating model so you can turn these strategies into, into action. And I mean, that's the wide field that is coming or is already here for the CFO. Yeah. That, that we look at and think about, Hey. What kind of tools, what kind of solutions are needed for, for finance departments to manage these demands, right?

Tom Raftery: 3:28

Yeah, well, let's, let's set the stage a little. So talk to me a little bit about what is driving the increasing rigor in sustainability reporting. Is it more about regulations, consumer demand, or is it something else entirely, or a mixture of all of the above?

Stephan Müller: 3:43

I think it's a mixture, right? I mean, obviously we see the anticipated evolution from today's more limited assurance. If, if you stay in Europe, this is a deal for now, right? Which come is a little bit bits of softer auditing requirements, but we already know that the regulation is shifting towards a reasonable assurance, right? And, and make it much rigour also from an auditability and traceability perspective, right? And, and likely along that way, the times of Excel and will be over. But it's, it's not only about the regulations. I think also for, for the internal decision making, right? I mean, if you really want to transform your company and we know, and we talk to a lot of customers that they truly want to transform themselves, not only because of policies and regulations, as we said, because there is a clear competitive advantage to that. You want to make business decisions based on a solid data foundation that you trust. Right. And I mean, you know, we know there, there's a tendency for sustainability data to be of low trust and we want to change that, right? We want to change that. We want to elevate that. We want to bring the trust to the sustainability data, not only for external reporting, but also for internal decision making, right.

Tom Raftery: 4:52

Excellent point. Yeah. Yeah. And we're obviously now seeing sustainability and finance converging like never before to your point earlier. Why do you think this shift to CFOs owning sustainability data is necessary?

Stephan Müller: 5:07

Yeah. I mean first of all, these, these regulations typically, typically not in all cases, but in many cases land on the desk of the CFO, right? I mean the CFO departments are typically responsible in creating these reportS4 CSRD for, for ISSB all this TCFD based regulations that typically land on the desk of the CFO, right, first of all. But moreover, what we also see is that the role of a CFO eventually also within a company almost changes, transform more to a value officer, right? So then only that you look at the finance side, you also need to have the company value in focus and let that be that your finance and that you make sure that those new sustainability business models can be turned into reality. Let it be that you need to think about sustainability risk and their impact on finance, right? I mean, we all unfortunately know of these disastrous weather events that we've seen recently and the cost that comes with that, the disruption of supply chain, right? I mean, all of those things eventually are financial risks. So we see, or what we believe that the role of a CFO is also evolving of that of almost of you could say value officer almost, right.

Tom Raftery: 6:21

Yeah, no, that's fair point. Let's into some of the challenges before we come back to the value officer point. I mean, for example, greenwashing, huge concern for stakeholders and how can robust carbon accounting frameworks help build trust and transparency to avoid that kind of risk of being accused of greenwashing?

Stephan Müller: 6:44

That answer can be a very, very long answer, Tom. Right. But let me, let me try to give some very concrete examples. Right that, that hopefully illustrate on on what we can bring to the, to the table with, with Green Ledger, right? So think about it, right? So if you, if you have a report, a sustainability report, and let's go for scope 3.1. So for thiS4 the emissions from purchased products and services, right? So one might come around and say, Hey, you reported. 1,000 ton of CO2 scopes 3.1, right? I mean, how did you actually come up with this data? Also looking on the earlier discussed a shift from limited to two more reasonable assurance, right? And I mean, but also always is a bit difficult, right, to come up I mean, let's let's say this is an Excel file, right? Which what we see. No offense, but what we see in many of the enterprises out there and I mean, you know how difficult it is, right? I mean, somebody is putting in all these formulas, right? And very few people actually understand these formulas. It's it's very difficult actually to trace who have, who has entered what data, right? At what point in time, right? Who has changed the data. So it's, it's, it's a very low trust way to account carbon from a technology point, I would say, but now think about what we do in finance. And if you could apply the same models now also for sustainability, if you could link that 3.1 number that you report and trace it all the way to the actual goods received. That caused these numbers that you can say, listen, I mean, those are the goods received in our reporting period that we got into, into our storage location that we got into our warehouse. That is the way on how we actually evaluated from a CO2 point of view, those goods received. This is where we got the data from. So you get the clear traceability from the report all the way down to the source document in an auditable way. And, and also, I mean, if we use the same rigor mechanisms that we today use for accounting, also for sustainability, that you post a document, you have a clear posting date. You have a clear user who created this document. If you change it, you just cannot go in there and change it. You need to cancel it, repost it. And by that, keep the traceability alive, right? If you would apply this now also for carbon, we believe the trust in this data can substantially be elevated, internally as well as externally. And trust is a super important currency when it comes down to business, right? You do business with those companies you trust.

Tom Raftery: 9:09

Yeah, yeah, no, that's true. And that leads me on, I guess, to the, the, the natural next question on that, which is you are posting that 1,000 kilos from stuff that you bought, but you then have to make sure that that 1,000 kilos that you're reporting from your suppliers, that that is the data they're reporting is valid data, which is challenging in itself, you know, how do you assure that your supplier's data that you're reporting is trustworthy?

Stephan Müller: 9:43

That's also an excellent question, right? And that, that question comes up in, in almost every customer conversation we have. I mean, it's important to state, right? First of all, what the Green Ledger does, it opens up our ERP, our S4 Hana Cloud. So our ERP system, in order to be able to account those numbers first of all, right? So if you receive a goods receipt that you can assign a carbon value to it, and that you then also can carry along this carbon value along the financial processes all up the way to the report. So this is, as we know it from finance, this is what we do, first of all with the Green Ledger. Of course, an important question is you need to get a number from your supplier, right? And, and to be very open and very honest, the Green Ledger as such won't help you with that, right? So we provide the possibility to account for that. But there are different solutions out there that can help you actually to elevate the data quality, to make this whole data collection process much more efficient. And for example, in SAP, we have a solution called Sustainability Footprint Management. Which you could think of a central repository for all your, your material footprints that you receive from your suppliers. And they also provide data traces, right? When you receive the footprint from the supplier under what standard, maybe under what certificate and so on to really create transparency on the footprints that you receive from your suppliers. But of course, eventually, it's also a question that you get a good footprint from your supplier. But the Green Ledger as such should be very open and honest. That does not help you with that task. But once you receive this footprint with the Green Ledger, you can account it and you can make it transparent in your company.

Tom Raftery: 11:18

Now you've mentioned the Green Ledger a couple of times in passing, but we haven't actually introduced it. So talk to me a little bit about this new product that has just come out this week, the green ledger from SAP. What is it?

Stephan Müller: 11:35

Yeah. The SAP Green Ledger as, as we say, is, is exactly that capability that just talked about, right. That you, that enables that open up our S4 HANA cloud system to be able to account carbon the same way we account the finance. So what does this mean? Right? So maybe let's do a concrete example. As we talked about goods received earlier. Let's let's stick with that, right? So imagine you receive a good from your supplier. What happens in finance, right? Somebody in the warehouse opens up, posts the goods received document as a material document in S4. Automatically based on the posting configuration of the system automatically, you also post a financial valuation, right? You say, Hey, to which profit center do I assign this? To which account do I assign this? To which business segment do I assign this? And you also evaluate it financially. Right? So if the, the clerk in the warehouse is, is capturing the goods received, they don't even think about it. This all happens automatically. And now let's think with Green Ledger we reuse, we mirror the same logic now also for CO2, that if we know the footprint from the supplier for that material that we ordered, that not only to evaluate it from a financial point of view, we also evaluate it from an emissions point of view, from a carbon emissions point point of view. By reusing the financial logic. So we reuse the account, we reuse the organizational units like a profit center, like the connected business segments, like the the company codes and so on and so on that we also now use to account for finance. We also account the CO2. And as you just said, right? I mean, eventually it's important that we have the footprint of this material. I mean, that's a prerequisite, but once we have that, we can account this reusing mirroring the financial logic. And by that we also align CO2 and finance on business processes on real actual business processes.

Tom Raftery: 13:25

And to my earlier point about not being sure about the trustworthiness of the data from some of your suppliers, flipping that on its head, if a company now is using Green Ledger, then their customers should be able to much more reliably trust the carbon data associated with the goods they're buying, correct?

Stephan Müller: 13:51

Yeah, absolutely right. I mean, that's the scaling effect we count on, right? The more companies request CO2 information, trustful CO2 mentioned, audited CO2 information. The higher is the need for solutions that actually provide you the capabilities to calculate them, in a transparent, traceable, and also auditable way. And yeah, the Green Ledger exactly plays into that, right down the value chain. So eventually to help elevating the data quality of complete industries. Yes.

Tom Raftery: 14:25

And I mean, this being the Climate Confident podcast and one of the mission statements, if I can use such a grandiose term for a podcast of the podcast is to highlight successful emission reductions, stories and strategies. So, is one of the capabilities of Green Ledger the ability to identify places where there's high carbon in your systems and therefore be able to work to reduce that.

Stephan Müller: 14:53

Yeah, absolutely. Right. I mean that's a part of this regulatory aspect that we talked about a lot now. Let's more look onto the internal aspect. Absolutely. I mean, that's one of the core values that you also see from an from an SAP Green Ledger that it makes you transparent where you can optimize within a company. So let me, let me give you some, some very concrete examples, right? So let's look on, on how we account for energy costs, right? And how we account energy costs on certain products, right? So we, we have a model established in, in, in companies where when you typically, you've got an energy bill, right? Once a year or whenever you get it on periodically, you'd be posted to an energy cost center. So first of all, the account and energy cost center for, for those energy costs. And then from that energy cost centers, we allocate them to production cost centers based on certain logics. Let it be the square meter, let it be the amount of products that they produce, right? So we have a certain logic on how we now account the cost of the energy to production cost centers. And from the production cost centers, we eventually assign the cost to our products. So we know the cost of the products that we produce. So, and that is there, right? That is running, that is established, that is there for, for companies for decades. And now we use that for carbon. We can, we can go all the same way, right? So if you now not only account the cost of the energy bill, but also CO2 of the energy bill to that energy cost center, and then from there we allocate it using the same logic to the production cost center, and then from there to the, to the, to the actual products, right? The, the, the carbon. So the areas where the carbon eventually resides become transparent in which production step in which production cost center. Right? So basically, we bring the data to the internal stakeholders to the cost center managers to the people that are responsible for the products on a very transparent way, not in an Excel, not in a Data warehouse that you somehow make these calculations. No, we reuse to establish financial controls in order to do that. And by that you can then also spot, Hey, there is optimization potential, right? Where do I need to prioritize my investments for transforming into a more sustainable a product et cetera, et cetera. And I can come up with many examples that we heard from customer that this actually can make a big difference.

Tom Raftery: 17:43

Just as you bring that up, do you have customer examples you can talk to? I know it's a new product, but I'm sure you've been kind of beta testing it with customers before launch.

Stephan Müller: 17:53

Yeah. So we had, we heard some, some great ideas from customers, what they actually like to do with it. I mean, one of my favorite examples is let's say agriculture, right? Harvesting machines. I mean, those harvesting machines, I mean, they easily cost millions of, dollars or euros, right? And hardly any farmer is buying them on cash. They get financed. And when you finance them, right, the financing company wants to know the footprint, right? Wants to know the sustainability number. So now think about when we produce these harvesting machines in an S4 system, right? We assign not only the cost so that not only that we can control the cost of that harvester during the production, but that we also assign the CO2 on the same way, right? We use the same logic, we use the same procedures, we get a very trustful, a very transparent information of the CO2 footprint of that harvester in the production, if it's not only helps me externally, because I can then give the financial, the financer, the investor, this number say, Hey, that's the CO2. They trust the number, but also internally, I can a lot of decisions are maybe not from a manufacturing from a professional service industry. Right. One could say, everybody in the company travel less 10%. We need to get our travel emissions down. You can do that obviously, but is that very precise? Is this very targeted? Is this very focused within a company? Maybe there is a department that somehow needs to fly because they do services in areas where you only get by airplane while others can easily take the train. So why not providing carbon budgets, the same way we apply financial budgets today on a cost center, right? And then also measure against these carbon budgets and say, Hey, you, you department, you service organization, you know, we do business in a lot in the US so you have to fly from Europe over to the US you get a higher carbon budget but the other ones that does service in Europe, you get a lower carbon budgets because you can actually take the train, right? And by that have a much more fair, a much more transparent operating model and just say, everybody fly 10 percent less.

Tom Raftery: 19:59

Nice.

Stephan Müller: 20:00

Yeah.

Tom Raftery: 20:01

And you use the term a couple of times earlier of a Chief Value Officer. So the, the idea that the Chief Financial Officer's role might be changing to a Chief Value Officer. Can you dig into that a bit more? Why do you think that the Chief Financial Officer is more likely to be, or tending towards being called a Chief Value Officer. What what's the increased value that you think they'll be supplying?

Stephan Müller: 20:27

Yeah. As we, as we strongly believe that in many industries, sustainability is acknowledged as a competitive advantage, right? Let's take this harvester machine. Let's take the chemical business, right? I mean, let's take the steel industry, which is under heavy transformational pressure, right? Where, where more sustainable products are actually a value and in order to transform those industry, let's maybe stick with steel for an example for, for now, right, not only did you need to manage it from a financial point of view, right? This transformation, of course, there is a financial impact on, on that transformation, but also, I mean, you need to manage it from a, from a carbon impact, point of view, right, that you're really not only define this business models on, on, on, on strategic level from a financial, but also from a sustainability point of view, but also eventually embed this into your operating model of the company. And we see that the CFO is very core and center to those discussions, right? To provide this data, to provide the platform actually for a company to transform. Or let's say the climate risk, right? That result or can result in severe costs and in severe financial impact to a company. So also here, right, we see the CFO as a very central role to also manage these new emerging risks that come from climate change within a company to make sure the company's also relevant tomorrow. So not only a pure financial view. But a financial view in combination with sustainability aspects, that's what we see and what we believe CFO will eventually evolve to. Right. And therefore they need tools that need solutions.

Tom Raftery: 22:08

And do you see this increased trustworthiness of a company's, and organizations, carbon data, do you see this becoming a competitive advantage?

Stephan Müller: 22:20

Yeah, absolutely. Me personally, I'm convinced trust is a super important currency when it comes down to business. Eventually you do business with those companies you trust, right? And the more trustworthy you are in, in your reports, right? We believe that the better it is also for your competitive advantage, right? Let it be financing option. Let it be finding investors out there. Right. But, but also eventually, put the money or put the investment within your company exactly at those areas, at those process where that can make a difference, right? So if you know, Hey, if I invest in that process, right that will make a change on my, on my product at the end. Right? So you use your, your finance most effectively internally as externally. And of course, eventually this will give you a competitive advantage, right?

Tom Raftery: 23:09

Yeah. And if your data seen as more trustworthy, your customers are more likely to come back or your cost of acquisition of customers should fall.

Stephan Müller: 23:18

Yeah. I mean, exactly. Right. So your, your, cost of your products will fall. Your financing costs will fall. And one key element is that you put your decisions on a platform on data of good quality that you can trust internally, as well as in, in, if you look at externally in the investor relations, et cetera. So yes, we are truly convinced down the road in the future, this will become a, an absolute key competitive advantage.

Tom Raftery: 23:46

And of course we mentioned greenwashing earlier, but of course, if your data is fully auditable, then any chance of brand risk from being, you know, accused of greenwashing immediately goes away.

Stephan Müller: 24:00

Absolutely. Tom, that's that's what we're also convinced of, or if another example, right, I mean, there, there is a calm price, right? And especially when we, when we look at Germany, if you take Germany as an example, right? The CO2 price have gone up from below€10 in 2014 to more than €65 in, in 24. And we believe it'll continue to rise and eventually be higher of that price of oil. Right? And, and, and communities can't wait implementing decarbonization strategies, right? Until the, the price is is unpayable, right? So, to start the transformation on, on sustainability today for, from our point of view is without alternative.

Tom Raftery: 24:42

Yeah. Yeah. And we're still in a space which is kind of immature for carbon accounting standards and, and auditing practices. So do you think, well, how long do you think it will take for those standards to be globally accepted the way we have financial standards, which are globally accepted and auditing practices as well?

Stephan Müller: 25:08

Yeah. We hope that that's, going to evolve quickly. Right. I mean, as it cannot be that we have also so many different standards, right. Which also make it very complex for, for companies to actually manage them. Right. So that we can agree on certain global standards, like, for example, we have with the IFRS in the finance world. So therefore, we, of course, look with a lot of interest into what the IFRS is doing with the ISSP with the International Sustainability Standard and Standard Board. And we also hope that those standards evolve and consolidate quickly. But yeah, I mean, that's also a, a question of politics globally which is difficult to predict. Right. But yeah, we, we hope, and we, we still see, and we still believe that this consolidation is on the right path and is continuing to go in the right direction, especially when we look what's happening on the ISSP side, et cetera.

Tom Raftery: 26:00

Okay. And do you see sustainability reporting influencing corporate strategy in, you know, in the next years and decades.

Stephan Müller: 26:11

Yeah, definitely. I think that the regulations and, and the political landscape of course, plays a very important role in making industries and making companies transform. But we also believe it's not the only, it's not the only advantage, right? As I said earlier, I mean also the belief sustainability is also a competitive advantage, right? Beyond the regulations and the policies. So I see there are, two trends. There's external pressure from regulations, but there's also internal transformation pressure on companies. Why? Because more sustainable business model, more sustainable products will eventually also provide you a competitive advantage. So the combination of the two, I think this is what's what's important.

Tom Raftery: 26:52

Okay. And it's not just the external and the internal pressures that you mentioned, but it's also, I got to think, cause I've, I've had this conversation before with Ken Pucker, for example, who headed up the sustainability for Timberland. He was Chief Operating Officer for Timberland back when they started doing their corporate sustainability reporting back in the early 2000's. So over 20 years ago, and his observation at the time was that it drastically reduced their costs of recruitment and retention. What he said was when they advertised positions, the caliber of people who applied for those roles was significantly higher than they expected just because they had such a good name in the sustainability space so I gotta think again similar as as this starts to become more rolled out for companies, the companies who jump on this will find their cost of recruitment and retention lowering as well because you have internal pressures I gotta think from employees who want to be working for companies that have a purpose increasingly now.

Stephan Müller: 28:00

Yeah, and that's a great point, right Tom, right, which is again, right, eventually a competitive advantage, right? If you can employ those people, you actually need a easier at lower cost, which again, eventually can become a cost advantage and with that a competitive advantage in industry. So it's a, it's a great example, right? Absolutely.

Tom Raftery: 28:21

And what advice would you give to CFOs and finance leaders who are just starting to take ownership now of sustainability reporting?

Stephan Müller: 28:30

Don't wait. Don't wait. Right. And I mean, also, it's, a journey, right? So what we see, it's, it's a journey. It doesn't happen overnight, right? I think what is very crucial and very important, as we also discussed earlier is to first of all, make the data available, right? Let's take again the scope 3.1 example, right? Get in touch with your suppliers. Get the sustainability footprint information from them. Try to be as effective and transparent there as possible. I mean, who wants to call all of their suppliers on a regular basis or exchange emails, right? So try to think on how this can become most efficient, right? And also here, for example, from SAP, we have a solution called Sustainablity Data Exchange, which is eventually a kind of a network of suppliers and customers where you can, and their customers, where you can exchange sustainability data on a commonly agreed standard on the network. So you only put your footprint once on that network. And then all of your customers can get it from there compared to the n to one communication, which might be going. And this, data availability and quality is this paradigm is key to then take the second step to get into an accounting point of view. Right. As we said earlier, right before you can account the data first, make sure that the data quality and the data as such is there. So start there, but already have the second step in mind to then also account in your company to then also, yeah, harvest all these, these values. And that, that we talked about earlier. And when, when I look at, at our customers, I think most of our customers are exactly on this journey. They try to get the data in good quality, they try to get the data first of all, but a lot of them are already thinking about the next step. Then bring this into a more operational perspective, right?

Tom Raftery: 30:27

Okay, and what metrics or KPIs should companies focus on to measure the success of their, you know, carbon reporting initiatives and ensure continuous improvement?

Stephan Müller: 30:40

I mean, eventually, right? The, the success that you will see based from your investments based from your initiatives will eventually be if you're, if your footprint goes down on a corporate level, right? So I mean, we all have, or not all, but a lot of companies have net zero targets, right? That we, that we work towards. Right. And I think what you will see is that it will continuously become easier and more effective to, to fulfill on these, on these net zero targets, obviously. Right. And also at a, at a lower cost, because you can spend your money exactly at those places in your company that have eventually this effect on, on the CO2 trend. And I mean, what you can also do with our Green Ledger, you can also put, for example, the CO2 in relation with the cost to say, Hey, what is the CO2 footprint of a Euro revenue that we receive? What is the CO2 footprint of my OPEX? What is the CO2 footprint of my CAPEX? And you can even internally, right in a company, you can, you can do benchmarking, how is product line one comparing to product line two in those carbon intensities compared to the cost, right? Which also will help you eventually to, to see how you are progressing, how inside a company you are doing if you look at, at various departments and again, on the SAP Green Ledger on a very clear data foundation that allows you to trust this information. If it comes down to opex intensity, if it comes down to capex intensity, if it comes down to revenue intensity, for example.

Tom Raftery: 32:23

Okay, and so you could have leaderboards of departments or of sites, for example, this particular site in Germany is doing significantly better or worse than this other one in France or Italy or America or wherever.

Stephan Müller: 32:39

Yeah. And you can ask them why, right? Is it because they may have a solar panel on the roof, made because they're using all the machinery, right? I mean, then you can start looking in that and really try to understand why is France better or worse, this plant in France better or worse than, than Germany, for example, right? Yeah,

Tom Raftery: 32:57

Nice. Where is it all going next? I mean, okay, we've rolled out Green Ledger now. Obviously the work doesn't end there. What are plans for Green Ledger for 2030, 2040? You know, where is it all headed to?

Stephan Müller: 33:13

Yeah, I think equally like the regulations are on a journey, right, that we believe also the Green Ledger will be on the journey. So what we released now is basically the initial goal to provide the basic capability. We are convinced this now will evolve, right? So it will grow from a capability point of view. We will get a lot of market feedback, what is needed, what is not needed, which will eventually grow and make this solution even more comprehensive. But I think one area in particularly that we are looking at, and obviously this is the area of artificial intelligence, right? So for example, we have ideas to use AI to assign carbon to invoices, right? And how you can use AI to then say, Hey, what is the footprint of this invoice, for example, to use AI, but not only AI in the accounting of CO2, but also obviously in the reporting, in the forecasting, in the planning, because so far we talked a lot about the actual side of the Green Ledger. But of course, I mean, this also enables a lot of opportunities on the planning side, right? And the forecasting side. So we not only can forecast finance numbers, we can now also forecast CO2 numbers on real actual business plans on, on actual sales plans, on material resource plans, on production plans, right? Not only to use this in order to forecast what will be my revenue or what will be my margin in the next years, but also what will be my my CO2. And I mean, AI will play a key role in, in that area as well. Next in the posting, as I've just said, right, that we are looking on, on capabilities to enhance the invoice posting with CO2, for example, I think that's a super, super interesting area where, where I believe we will see a lot of movements in, in the years to come

Tom Raftery: 35:04

Interesting. Okay. And left field question, Stephan, if, if you could have any person or character alive or dead, real or fictional as a spokesperson for trustworthy carbon accounting, who would it be? And why

Stephan Müller: 35:28

From the history. I can pick any, any person. Right.

Tom Raftery: 35:30

Real or fictional? It doesn't have to be a real person either.

Stephan Müller: 35:34

Somehow my mind gets stuck around Da Vinci, right? Such a genius engineer, such a genius visionary as well, right? In, in, in, in the time having, having such a genius still living today, right? And speaking out for for Green Ledger, speaking out for more sustainability, right? I think could could really make an impact. And also his his genius in designing machines, his genius in in designing new systems, I think, is something we could truly benefits in today's world. And having him as a as, as an advocate for, for more sustainability, having him as an advocate for, for something like the SAP Green Ledger, I think that would be a really nice thing, right, the thing to have,

Tom Raftery: 36:23

Superb, superb, excellent, great. Okay, we're coming towards the end of the podcast now, Stephan. Is there any question I did not ask that you wish I did, or any aspect of this we haven't touched on that you think it's important for people to think about?

Stephan Müller: 36:39

Yeah, there's, there's one aspect, which I think is also a key aspect of the Green Ledger. And that is actually that we make sustainability data available to broader user basis, right? I mean, if you think about in, in companies today, where's the sustainability data, it's typically in data warehouses, it's typically in own systems, which is not bad as such, right? But to those systems only few users have, have access, right? And I mean, if you need to make a business decision, let's say you want to procure something. You don't have this data at hand, right? I mean, of course you could go there and could look and then change your business decision, but is this the most effective way? With Green Ledger, we, we really bring this data to the point of decision making to eventually all users of an ERP system. That if you make a procurement decision, you not only see the financial impact, that you also see the CO2 impact. And you could say, we democratize the sustainability data. We make it available to very broad set of users, right? That can actually work with the data and, and just that make this data available to the users, to the people at the time, and then we need to make decision. We believe can make a tremendous impact. So we we set the sustainability data loose, right? We bring it out there and then yeah, let people decide on that. I think this is a very key, key aspect that also the green ledger brings with it apart from this whole rigor and logic point of view that we make the data available to the users.

Tom Raftery: 38:09

Fantastic. Great. Super. Stephan, if people would like to know more about yourself or any of the things we discussed on the podcast today, where would you have me direct them?

Stephan Müller: 38:20

Yeah. I mean would be super interested. So if you have questions, if you want to continue the discussion outside of this podcast, right. You, you can easily find me on LinkedIn, right. Obviously, and if you want to know, if you want to know more about the Green Ledger, go to our product site sap. com green ledger, and you will find much more information. You will find videos, how that actually looks like in action. You will find demos. You will find screenshots and where you can also get in touch with SAP if you are interested in the green ledger and the good things it can do for you and your company.

Tom Raftery: 38:53

Fantastic. And I'll put those links in the show notes, Stephan. So everyone has access to them.

Stephan Müller: 38:58

Super Tom, super

Tom Raftery: 39:00

Thank you, Stephan. Thanks a million for coming on the podcast today. It's been fascinating.

Stephan Müller: 39:04

Thank you, Tom for having the opportunity to discuss with you the Green Ledger and yeah, having the opportunity to share our story on Climate Confident.

Tom Raftery: 39:14

Okay, we've come to the end of the show. Thanks everyone for listening. If you'd like to know more about the Climate Confident podcast, feel free to drop me an email to tomraftery at outlook. com or message me on LinkedIn or Twitter. If you like the show, please don't forget to click follow on it in your podcast application of choice to get new episodes as soon as they're published. Also, please don't forget to rate and review the podcast. It really does help new people to find the show. Thanks. Catch you all next time.