Two Steps Forward

Inside Salesforce’s innovative new sustainability reporting platform

GreenBiz photocollage

If you ask a roomful of professionals what tools they use for sustainability data collection and reporting, the answers will be as different as they are consistent:

They use lots of tools. And, by and large, they dislike them all.

With good reason: Many tools are ubiquitous but kludgy, not purpose-built for sustainability reporting needs — think Microsoft’s Excel, a go-to app used by many corporate sustainability execs. Other tools are slicker and more tailored to the task at hand but may require training by all those involved with gathering, massaging and using the data, from plant managers to investor relations folks.

And nearly all of them require gathering and inputting data by hand — a long and often tedious task, with the result that the data reported today may be as much as a year old.

That’s the backdrop against which Salesforce this week announced its own solution, built on its ubiquitous software platform, designed to make sustainability reporting as quick and efficient as financial reporting. The company describes its new Sustainability Cloud as "a carbon accounting product for businesses to drive climate action that will accelerate the world’s efforts towards carbon neutrality," though it has the potential to do much more over time.

The product, like so many other innovations, was born of necessity: the need for a more efficient and timely way for Salesforce to collect and report its own performance. "When you combine our interest in being transparent and trusted to all of our stakeholders, shareholders included, we've been oriented towards trying to be a leader in bringing our environmental data up to the same caliber as our financial data," Patrick Flynn, Salesforce’s vice president of sustainability, told me recently.

"The state we were in prior to building this tool is that the footprinting process was fine, but it wasn't getting better each year. It was a six-month slog that we were getting through, and it wasn’t improving. It was six months this year, six months the year before."

Forward, not back

Flynn and his team examined myriad solutions, none satisfactory, before tinkering with the company’s own flagship CRM suite. "The Salesforce platform emerged as a fantastic tool to enable all of that because in environmental accounting, the process involves bringing a lot of stakeholders together to collaborate, to communicate, to track data in a big project and process," he said. "That can look a lot like the processes that Salesforce technology enables our customers to do across many different parts of their business." 

The result: "This year, we were able to do our environmental closing of the books as fast as we did our financial closing of the books. And had our key environmental claims audited — limited assurance by Ernst & Young — in time to be reported out in our 10K. So, our environmental data is moving at the quality and speed of much of our financial data. For a sustainability professional, that means we can spend much more time during the year looking forward than looking backward."

In December, a souped-up version will be rolled out to Salesforce customers and also available as a standalone program.

Flynn gave me a demo of the software, using data from the tech company DocuSign, one of the platform’s beta customers. It opened with a high-level overview of broad, company-wide metrics: energy and carbon emissions; renewable energy; and other sustainability indicators.

Drilling down into energy and carbon emissions provides more detail. In the case of DocuSign, its footprint has a lot to do with data centers and offices. So, there are views for energy and emissions over time, electricity consumption by geography, as well as the cleanliness or lack thereof of the grid energy it is using.

Another screen shows DocuSign’s 16 real estate locations, with detailed performance data on each. Some data is pulled from other parts of the Salesforce platform. For example, for DocuSign's office in New York, there’s already a range of relevant data in Salesforce: address; ZIP Code; square feet; who the contacts are; who the approvers are; the grid it's on; rolled-up summaries of energy and electricity consumption; and renewable energy allocations. The resulting footprint is calculated automatically by looking all of that up.

Chasing data

The platform relies on extrapolation to short-cut some data collection, explained Flynn. "Chasing data for the sustainability manager is an incredibly tough part of the process and a big reason why it takes so long. And often they're sent chasing data that actually isn't going to move the needle all that much on their strategy or their reporting. So, let's use software and plug the holes quickly and circle back if we have a greater need for more detail at a later time."

Any questions or notes that come up during the footprinting process get captured and time-stamped with the author’s name, which can streamline the process for subsequent years and provide breadcrumbs that enable auditors, among others, to more quickly understand some underlying data.

The whole process guides the user through the footprinting process "and turns something that used to take six months and was brought about by a whole tangled, brittle web of spreadsheets into something that can be done faster, higher quality and improved year on year," said Flynn.

Salesforce’s chief financial officer, Mark Hawkins, one of the company’s sustainability champions in the C-suite, was a key ally to Flynn and his team. Hawkins is also a co-founder of the North American chapter of Accounting for Sustainability, or A4S, established in 2004 by the Prince of Wales, whose goals include transforming financial decision making to reflect the opportunities and risks posed by environmental and social issues.

"What we hear from the investor community is they want high-quality data," said Flynn. "They want metrics tied to parts of the business that are material to the business delivered to them. They’re less interested in a score by some third party or a particular rating framework. They want the underlying data."

Flynn is the first to acknowledge that no such software platform can solve every sustainability reporting challenge. For example, "Software is never going to help a sustainability professional know who in the building manages the utility bills. Especially if you're a small subtenant and had to get that data from that person."

But, he says, the right platform can ensure data integrity, a key goal of the Sustainability Cloud. "Wherever the data comes in, it gets funneled into this clean organizational process that takes it on a journey to be analyzed, aggregated together, verified, inspected. And then ultimately, in our case, provided with a limited assurance by a Big Four firm that does our financial auditing, in our case Ernst & Young."

I noted that the Sustainability Cloud focused primarily on measuring and tracking negative impacts — energy consumption, climate emissions, waste generation and others. Could it ever be used to track positive, regenerative outcomes, such as carbon sequestration or closing the loop on waste?

Flynn responding by describing the product roadmap. "Things like being able to access options for renewable energy, options for carbon offsetting, places where companies can collaborate on shared supply-chain initiatives. This is just the beginning, and the right place to begin was carbon emissions and the footprinting process and a holistic view to start developing strategy. The future will include a whole lot more."

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