SAP: AI & Data Key to Closing COP29 Climate Commitments Gap

As governments continue to implement stricter emissions reporting requirements, global technology companies are facing mounting pressure to provide adequate tools for measuring and reducing corporate environmental impact – especially amid the rapid deployment of large language models and generative AI.

With predictions that the growth of AI infrastructure could generate emissions equivalent to the annual output of Saudi Arabia by the end of the decade, regulators in the European Union, United States and Asia have introduced mandatory climate disclosures for large companies, creating challenges for businesses that lack systems to track their environmental impact.

Despite the scale of this challenge, technology providers have identified this gap as a market opportunity. Tech giants including Microsoft, Oracle and Salesforce have launched products to help organisations measure their carbon footprint, while startups continue to develop innovative and specialised tools for emissions tracking.

Yet according to SAP’s sustainability chief, enterprise technology companies must focus on data collection and AI to help businesses implement climate commitments made at the United Nations climate conference

SAP, which provides enterprise resource planning software to 88% of Fortune 500 companies, sees technology as central to implementing agreements reached at COP29 in Baku, Azerbaijan.

The conference aimed to establish new climate finance frameworks and strengthen national commitments to reduce emissions. However, according to SAP, implementation remains a challenge for many organisations.

Technology giants target climate data collection

Sophia Mendelsohn, Chief Sustainability and Commercial Officer at SAP, says companies already possess the data needed to measure their environmental impact. “Sustainability data is available in every organisation's ERP system, so it’s time to start automating data collection and reporting processes to ease some of the regulatory burden,” she says.

Enterprise resource planning (ERP) systems – which manage business operations and customer relations – contain information about supply chains, energy usage and materials that could measure environmental impact.

The shift towards renewable energy presents opportunities for technology companies to develop new measurement tools. Investment in renewable infrastructure continues to grow, though fossil fuels remain central to many economies.

According to SAP, technology providers see opportunities in carbon markets and product-level emissions tracking. These markets require precise measurement of emissions and verification of carbon credits.

“Companies should leverage IT spending to support sustainability initiatives, specifically by applying generative AI to optimise climate solutions and create circular products,” says Sophia, who suggests that AI tools could help companies analyse their environmental impact and identify areas for improvement.

Global standards emerge for carbon accounting

The development of tracking tools comes as regulators implement environmental disclosure requirements. The European Union’s Corporate Sustainability Reporting Directive requires 50,000 companies to report environmental impact data from 2024.

Similar requirements have emerged in other regions. The United States Securities and Exchange Commission plans to introduce climate disclosure rules, while Singapore requires financial institutions to report climate risks.

At COP29, participants discussed the need for harmonised global standards in carbon reduction and accounting. Representatives from central banks emphasised the need for consistent measurement approaches to enable cross-border comparison of environmental impact.

Looking forward, close collaboration between finance and sustainability departments has become essential as climate considerations affect business planning. “Effective climate action demands collaboration between chief sustainability officers and chief financial officers, as climate change has evolved from an ethical and environmental issue to a pressing financial imperative,” says Sophia.

“To accelerate progress, we need globally harmonised policies, rigorous carbon accounting frameworks and advanced technology solutions. By embedding AI-driven innovation, robust reporting standards and actionable insights into business operations, we can ensure that COP events, such as COP29 in Baku, are remembered as turning points – not just discussions. While the challenges ahead are formidable, the opportunities for transformative action are even greater – and SAP is here to lead the way on a low-carbon, circular future.”

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