Sustainability will drive returns on investment with assist from inflation

Sustainability will need to generate returns on investment, but surging inflation means the hurdle to transitioning to net zero carbon is lower, said Janina Nakladal, Director of Sustainability at Celonis.

"The cost increases of transitioning to net zero are lower than they were due to inflation," said Nakladal.

Speaking at Celonis' World Tour 2022 Houston, Nakladal said that efficiency and sustainability will converge. "It will be efficiency plus sustainability that will get you performance," she said.

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Nakladal said that sustainability efforts will deliver returns as long as it's more than just about window dressing. In addition, top-down sustainability goals often lack the focus on the process details that also lead to efficiency gains elsewhere.

For instance, suppliers, procurement, production, logistics and inventory and order management are all key areas that impact sustainability, said Nakladal. She added that emissions data can be calculated by data that already exists in many systems.

For instance, a Celonis Data Connector to an ERP system can provide data elements such as departure address, arrival address, shipping type and weight. Those data elements can be further quantified in the Celonis EMS and enriched with more data.

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• Proposed SEC rules could accelerate sustainability data collection

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Sustainability return on investment was a core theme at the Houston World Tour 2022 stop. During the keynote, IBM's Scott Layton, Vice President of Global Finance Transformation, noted that "sustainability has to have a return on investment." Layton added that looking at the carbon footprint in the supply chain can also achieve sustainability and efficiency goals.

Nakladal added that momentum for sustainability projects is increasing due to regulation as well as supply chain efficiency. Ultimately, Nakladal said the green line for enterprises will be as important as the top and bottom line growth.

"We need to have return on investment on sustainability," said Nakladal. "It's tough, but comparable to other transformations. It's a matter of putting sustainability into the day-to-day operations."

Larry Dignan

Editor in Chief (former)

Larry Dignan is the former Editor in Chief of Celonis Media. Before joining Celonis, he was Editor in Chief of ZDNet and has covered the technology industry and transformation trends for more than two decades, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine.