Sustainability is a topic high on the agenda in many boardrooms, also at SAP, where sustainability is one of the three strategic pillars. Alliances have a big role to play in sustainability, for example, sustainability in terms of constraining GHG-emissions, 90% of a companies GHG-emissions are out of it’s own direct control (Boston Consultancy Group, 2022). These emissions, also referred to as “scope 3 emissions”, can only be reduced by collectively transforming the whole ecosystem. For this transformation, sustainable alliances are needed.
In the guest lecture, …. Mentioned that one of the target client fields for SAP (and Accenture) was the oil and gas sector. The oil and gas sector is widely regarded as one of the most emitting and unsustainable sectors, it seems strange that a company with, on the one hand has sustainability as strategic pillar, and on the other hand is targeting oil and gas companies as a strategic opportunity.
By getting involved the reputation as a sustainable company SAP is trying to gain will actually be vulnerable. NGO’s are known to target companies who say they work on sustainability, but are working together with fossil fuel companies. For example, in 2014 Greenpeace started a three-month lasting campaign, to stop Lego from working together with Shell. This damaged the sustainable reputation from Lego (Greenpeace, 2014)
Moreover, by getting involved with fossil fuel companies you legitimize the existence and activities of those companies. According to the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC), we should not explore new fossil fuel fields to limit the global warming to 1.5C degrees. An activity most fossil fuel companies are still heavily invested in.
And finally, by focusing on fossil fuel companies you fail as a company to address the transformational changes which are needed to move to a more sustainable world. SAP should look to the opportunities the energy transition is offering by forming alliances with companies that are the frontrunners of the transition, instead of forming alliances with the companies of the past.
On the other hand, by forming an alliance with oil and gas companies you can also direct them into the right strategic direction. You can work together to create a more sustainable business. If SAP will be able to address systemic issues at the oil and gas companies they will work with, they might be able to make a real-world impact and follow up on their sustainable strategic pillar.
To conclude, it may seem paradoxically that a company with sustainability as strategic pillar would focus on oil and gass companies, but this will only be the case if the company (SAP) fails to address sustainability issues in their collaboration with the oil and gas companies.