Information Systems for Environmental Sustainability

IT, Resource Productivity, Environmental Preservation, and the Fourth Industrial Revolution

KPMG: “Vital component of successful [GHG] data collection is the integrity, robustness and adaptability of the information systems being used”

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KPMG posted a new report on what CEOs need to know about carbon emissions.

Ironic treatment of IS.

On the one hand, IS is left out of the governance figure below (not sure what evidence underlies this, and curious exclusion given that KPMG itself has a strong IT governance component in sustainability efforts). What do supply chain managers, lawyers, financial analysts, and production engineers know about effective purchase and roll-out of complex IS that change day-to-day work practices across the enterprise? How about the cost-benefit computations involved with making the business case? How about vendor vetting and management? How about customization? How about maintenance and upgrades?

On the other hand, the authors acknowledge the importance of IS and the immature management of carbon data:

A vital component of successful data collection is the integrity, robustness and adaptability of the information systems being used.

“Vital components” also apply to data management, data maintenance, data validity, information processing, information presentation, information reporting, etc.

Many IT organisations are developing commercial software solutions for carbon emissions data collection and management. This is likely to be a significant growth area, allowing organisations to select an appropriate information system.

If they understand the twin complexities involved with large-scale software implementation in an area with rapidly evolving metrics and requirements (carbon emissions).

Emissions reporting should be based on a streamlined reporting process to provide a single, robust, source of emissions data. This reporting should link to other corporate reporting systems including finance, rather than operate a stand alone system where data can be lost or corrupted as it is moved.

Lots of “shoulds” here. What about the challenges involved with doing this and how to overcome?

As in a business’s finance function, a system of data controls is needed for emissions and energy reporting. The controls inherent in carbon emissions data collection systems, whilst improving in many organisations, are often not strong because:
• they are usually in sites remote from head office without a direct focus of attention
• they do not have a general ledger control account such as occurs with inventory
• checks and cross-checks common in financial systems are often missing due to the immaturity of systems.

…because they are often based on Excel spreadsheets, which are incompatible with these requirements.

Features of robust systems of carbon emissions data and collection include:
• regular checks and calibrations of monitoring devices or measurement equipment
• sign-off by the person taking measurements or making calculations
• approval by a more senior knowledgeable person of the recorded readings or calculations
• reconciliation of periodic measurements or calculations to six-monthly or annual results
• cross checks, with an analysis and explanation of variations, of qualitative data to other data such as production levels where a relationship exists and budgeted data and/or data from previous periods.

How can the substantial data collection and inf0rmation management and reporting tasks be effected without strong involvement and leadership from the IT organization? Will this be similar to ERP in the 1990s, where many organizations failed to successfully roll out similarly large enterprise systems?


Author: nigelpm

Associate Professor of Information Systems, Stephen M. Ross School of Business, University of Michigan - Helping organizations to navigate digital transformation.

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