Beyond compliance: using Business Central to report and deliver on sustainability targets

When you look at your current ERP or think about a new system, sustainability features may not be the first to spring to mind. It's tempting to stall sustainability tracking and reporting when things like inventory management and production planning come first.

But the tides are changing. Consumers, suppliers and employees want sustainable and ethical practices. Just "doing your bit" isn’t enough anymore. Businesses need to set clear, measurable sustainability goals and be able to prove they’re delivering on them. 

Using the right tools to track and report your sustainability efforts helps your business stand out, ultimately drawing customers to your company.

What is corporate sustainability?

Sustainability can feel like an emotional topic, and it means something different to everyone. For businesses, corporate sustainability is a balancing act of environmental responsibility, social impact and the bottom line. It’s meeting your needs without stopping future generations from meeting theirs.

Making your business more sustainable may mean some short-term costs. However, the long-term benefits (think economic, social and environmental) are worth it.

The EU has strict laws for sustainability. These include the EU Nature Restoration Law and the Packaging Waste Regulation, among others. The UK has sometimes lagged in areas like water quality, chemical use and air pollution, but that’s changing.

As these practices become common, more EU-style laws will come to the UK. Your business must be ready to track, report and meet sustainability targets.

Why sustainability reporting is important for manufacturers and distributors

When thinking of why sustainability matters, doing the right thing plays a huge part. Reducing your environmental impact and carbon footprint helps tackle climate change. Every business has a role to play in adopting sustainable practices and helping future-proof the world we live in.

Companies also have a social responsibility. Whether you're a small or large organisation, every company is part of a community, which brings responsibility, from fair and inclusive labour practices to transparent reporting and community engagement.

Here’s the business case: sustainability isn’t just good for the planet; it gives your company a competitive advantage. Customers and suppliers working with companies that take sustainability seriously (no more greenwashing) equals long-term profits, stability and opportunities to innovate.

The shift is already happening. 62% of manufacturers now have ESG targets or KPIs – a 48% jump since 2021 (Make UK). If you’re in the 38% who haven’t started yet, now’s the time to get moving.

CBAM regulation is coming to the UK – how to prepare

The UK is catching up with EU sustainability laws. Right now, the hot topic for manufacturers and distributors is CBAM.

CBAM (Carbon Border Adjustment Mechanism) is a tax on imported goods that produce a lot of carbon emissions. CBAM is coming to the UK on 1st January 2027. The new legislation will make sure cheaper imports that don't factor in their environmental impact will not undercut local suppliers. Essentially, it's a driver for positive change.

CBAM will apply to companies importing certain goods like aluminium, cement, fertilisers, hydrogen and iron steel products (this may evolve). If you’re bringing these goods into the UK, it’s time to get ready for new reporting and fee requirements.

So, what should you do now to make sure you’re ready for CBAM? Start gathering data. Talk to your customers and suppliers, see what they need from you and review how this legislation could affect them.

Using Business Central to track and report on sustainability practices

Sustainability is climbing the priority list for UK businesses. A whopping 90% of organisations plan to boost ESG investments, but nearly half still use spreadsheets to manage data (PwC ESG Reporting Survey).

Thanks to digital tools, it’ easier than ever to bring sustainability into your daily operations. Platforms like CBAMBOO and Valpak help with carbon intelligence and CBAM compliance, whilst Microsoft Dynamics 365 Business Central gives you powerful sustainability features right at your fingertips.

Business Central is evolving to help manufacturers and distributors put sustainability at the heart of their operations. With features like the Chart of Sustainability Accounts, you can track emissions just like you track financial data. Sustainability journals let you post emissions entries and create a clear audit trail for carbon reporting, so no more digging through spreadsheets.

Sustainability features already built into Business Central mean organisations can adapt as regulations like CBAM demand more granular traceability across procurement and production processes.

Embedding your sustainability tracking and reporting into Business Central makes sustainability actionable for all teams, from operations to finance. Procurement value chain tracking links emissions to purchases and manufacturing steps, while emission fee management makes sure carbon costs are accurately applied and updated. All this data can be stored securely, ready for compliance reporting.

Having this data means nothing if you can’t make sense of it or turn those numbers into actions. Enter Business Central’s built-in reporting tools and Power BI integration. 

Power BI integration in Business Central + corporate sustainability reporting = your ESG superpower

With Power BI’s Business Central integration, manufacturers and distributors can transform raw emissions data, procurement footprints and CBAM-related costs into interactive dashboards and visual analytics. It’s an easier way to monitor carbon intensity, track emissions and compare actual performance against regulatory targets in real-time.

The built-in Power BI apps for Business Central bring your financial and sustainability data together, so you get a unified view of your ESG performance.

These dashboards don’t just look good – they highlight trends, forecast future emissions and flag compliance risks before they become a problem. For CBAM, Power BI can help you see carbon fee impacts across different scenarios so you can plan imports and protect your bottom line while staying compliant.

Reporting on sustainability and staying ahead of legislation – the next steps

New sustainability legislation like CBAM might not come into effect until 2027, but there’s no time like the present to start preparing! 

Get your business ready with the tools, knowledge and know-how for reporting and delivering on sustainability goals with these practical steps:

• Start internal planning – look at what’s coming (CBAM, UK carbon pricing, packaging rules) and where it might hit your business hardest.
• Get talking! Chat with your customers and suppliers. See what they need from you and how to prepare them for the upcoming changes.
• Tap into Tecman resources – from blogs to training sessions, dive into Tecman resources to get to grips with sustainability reporting and tracking in Business Central.
• Check your goods against the CBAM scope – both EU and UK versions. If you’re importing carbon-heavy items like steel or cement, you’ll need to be ready for new reporting and fees.
• Talk to your suppliers about emissions data – you’ll need their numbers for your own calculations. The sooner you start, the easier it’ll be to build a complete picture.
• Start playing with Business Central’s sustainability features – before it’s mandatory, start tracking emissions data and carbon costs in Business Central and keep an eye out for new sustainability features. Test, tweak and get comfortable.

Businesses that put sustainable practices into action and can report and show their progress stand out to customers, suppliers and employees.

With digital tools and built-in sustainability features in Business Central, you can stay ahead of upcoming legislation and make your business socially, economically and environmentally responsible – showing you’re serious about making a difference.

Learn more about Business Central and integrated sustainability features. For more tips, insights and advice on preparing for CBAM and upcoming legislation, get in touch – we’re happy to help!