While green IT is gaining a lot of attention and investment in the high-tech industry, the related concept of corporate social responsibility has only been tackled by a few of the largest software developers in the business.
But now CSR (corporate social responsibility) software, which gives enterprises tools for tracking the amount of resources, such as energy, they are consuming and the amount of greenhouse gases they are releasing into the atmosphere is getting a new twist from an early-phase startup.
CSRware is in the midst of developing software, expected to be available with a summer launch, which will enable companies with multiple data centers to both track their use of resources and identify consumption reduction opportunities.
Large and established vendors like IBM and Lawson Software, are among the few that offer CSR-based applications.
But there is a key difference in how CSRware is going to deliver this functionality. CSRware is utilizing a SAAS (software as a service) model to deliver a suite of Web-based software that, through a set of dashboards and a centralized repository for sustainability management processes, links data center emissions and resource utilization.
The company’s founder, Karen Alonardo, has a strong background in IT-with 17 years running data centers at Electronic Arts and Critical Path-coupled with a Masters degree in Environmental Management.
“My background is in high tech and I come from a hosted IT environment,” said Alonardo. “After doing that for a long time-I went through the [dot-com] bubble and had a good time-I went back to graduate school. It dawned on me that there was no situation or technology around corporate social responsibility or sustainable management. There are a lot of smart people putting things together, but there was no way to get into the enterprise environment easily. CSR was always a public affairs issue, where people are writing reports.”
What Alonardo realized is that in order for business and IT to really take corporate social responsibility seriously, CRS had to be positioned as a technology play and become more of a repeatable process.
At the same time many of the people who deal with corporate social responsibility issues (outside of IT) are not concerned with on-premise implementations of software. “Quite frankly a lot of CSR people are not technical; they actually prefer CSR as a service,” she said.
But industry analysts indicate CSRware faces significant challenges as an SAAS pioneer in what is clearly an emerging technology sector.
“Both compliance and corporate social and environmental responsibility will be strong market drivers for eco-efficient software in the next three to five years, especially in reporting and analytics,” wrote 451 Group analyst Andy Lawrence in a Feb. 15 report.
“We believe the SAAS delivery model is well suited to this function, and CSRware’s understanding of both environmental reporting and datacenters will give it an edge in data collection and presentation,” the report continued. “But given the immaturity of both the market and of CSRware itself, it will face some tough challenges in winning customers and establishing a defensible market position as competition heats up.”
While Lawrence lists a number of potential competitors to CSRware-Enablon, ESP, credit360, StakeWare, Proventia, TechniData aimed at big corporate compliance initiatives-there are some established applications vendors on the CSR trail as well.
On Feb. 12 IBM Global Services released a white paper, titled “Attaining Sustainable Growth through Corporate Social Responsibility,” that makes recommendations to help companies develop an integrated CSR strategy.
Part of that strategy, of course, is implementing IBM’s software. But IBM also suggests that companies can actually make money through compliance initiatives.
“Quite recently companies have started shifting their thinking about what it means to be socially and environmentally responsible,” wrote George Pohle, vice president and global leader for IBM’s Business Strategy Consulting Practice and Jeff Hittner, corporate social responsibility leader for the IBM Institute for Business Value in the paper. “Today, a surprising number of companies already regard corporate social responsibility as a platform for growth and differentiation.”
Pohle and Hittner said that, in a survey of more than 250 businesses, IBM found 68 percent of businesses are focusing on CSR activities to create new revenue streams, and over half (54 percent) believe their companies’ CSR activities are already giving them an advantage over their top competitors. The duo gives the example of Catalyst Paper, a Canadian pulp and paper company that uses its own by-products to power its operations and regains heat from effluence to warm process water, which in turn reduces the company’s carbon emissions.
Lawson on the other hand provides a suite of software based on a number of areas including GRC (governance, risk and compliance), food safety and the environment. Lawson, like CSRware, is a registered organizational stakeholder of the Global Reporting Initiative, or GRI. Both companies support the mission of GRI, which is to develop globally accepted sustainability reporting standards. CSRware’s reporting framework that helps companies analyze their use of resources and gas emissions is based on GRI’s standards, according to 451 Group. “This should ensure that the results are acceptable to CSR professionals and, presumably, auditors,” writes Lawrence.
CSRwares three modules
CSRware’s software includes three modules: the Corporate Sustainability Module that covers eco-efficient IT and greenhouse gas reporting; an Enterprise Sustainability Platform used to benchmark, quantify and monitor initiatives; and the Corporate Sustainability Analytics used to plan and model data.
The software can take data from most electronic sources including Excel, which is the most widely used application companies use to track resource use and CO2 emissions.
The difference between what CSRware provides, compared to more established companies like IBM and Lawson, is a more holistic approach to sustainability, according to Alonardo. “Their focus is specifically on energy efficiency in the data center. We incorporate the data center aspects-including the overall footprint of an organization-with areas like the real estate group and suppliers,” she said. “It’s like eco-analytics with a very strategic perspective.”
But CSRware, like many of its would-be competitors, still in the early stages of market development. And that market is clearly fragmented. Alonardo likened CSRware’s software to PeopleSoft in its early days; PeopleSoft was the first software company to automated Human Resource processes.
“There are still a lot of people grappling with spreadsheets,” she said. CSRware, in pilot phase now, is seeking additional funding to build out the infrastructure necessary for the summer launch.
The million dollar question for CSR vendors is who to approach in the enterprise: the sustainability group-if it exists-or IT? Alonardo said that if a sustainability group is indeed in place that typically will be her company’s first target. Absent that, the company will target the IT group, which often has the budget to acquire new software, and the ability to manage the data center.
CSRware is currently piloting projects with three major companies targeting specific vertical segments: high tech, retail and the data center.
“There is clearly a big opportunity for more specialist software,” writes Lawrence. “Businesses must address increasing corporate responsibility pressure, and regulations, relating to their use of natural resources. At the bottom of the all the world’s carbon mitigation schemes-whether voluntary or mandatory, cap and trade or taxation, offset or sequestration-somebody will have to be collecting and reporting on the raw data.”