Measuring Green Projects Is Getting Even Harder

June 7, 2010
Although green measurement is considered important, businesses worldwide lack the correct systems to track their full environmental footprints

Although green measurement is considered important, businesses both in the United States and Europe lack the correct systems to track their full environmental footprints, according to an independent study conducted for enterprise software vendor IFS in the U.S., Scandinavia and Benelux.

As environmental regulation advances in both Europe and the U.S., businesses are facing increasing pressure from regulators, customers and investors to document and reduce their environmental impact. According to the study, research data suggest that organizations need to make wholesale changes to their business technology to keep up with these rapidly advancing mandates.

The study, based on surveys of industrial executives in each region, discovered that over three-quarters of companies consider it important to track their environmental profile—including 83% in the U.S., 82% in Scandinavia and 79% in Benelux. However, nearly three-quarters of European respondents (74% in Scandinavia, 75% in Benelux) admit to not having sufficient enterprise resources planning (ERP) software in place to track their environmental footprint. The U.S. fared slightly better, with 47% saying they lacked the enterprise software for environmental tracking, with an additional 42% claiming limited capabilities for tracking environmental impacts.

Respondents in different geographies answered differently when asked what the most important reasons are for green IT initiatives. In Scandinavia, 35% of respondents say the marketing value of green initiatives is the most pressing reason to implement enterprise software capable of managing environmental impacts, outstripping regulatory compliance (22%) and cost cutting (19%). In contrast, respondents in Benelux and U.S. say that environmental compliance was a more important benefit (36% in the U.S., 34% in Benelux) than marketing and cost reduction benefits.

Over half of all the U.S. and European organizations surveyed want embedded environmental tracking to be included in their existing ERP solutions. However, although interest is high, many could not name ERP vendors that included this specific functionality.

"The results of this independent research show that green measurement has re-entered the boardroom as a business priority in both Europe and the U.S.," says Alastair Sorbie, CEO of IFS. "Equally, it highlights that despite the perceived importance of tracking and lowering environmental footprints, organizations remain unable to obtain the necessary information from their core business systems to make this possible. In fact, they remain largely unaware of how enterprise applications, already sitting at the heart of their businesses, can support them in this way. Environmental issues are becoming increasingly important, not only for customers, but also for the capital market looking to invest in more ethical and sustainable organizations."

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