IFS Enhances Sustainability with New AI Module

IFS launches cloud sustainability module with automated emissions tracking

Enterprise software provider IFS has released a dedicated sustainability management module within its cloud platform. The October 2024 update introduces automated ESG data collection, emissions reporting for Scopes 1 to 3, and compliance tools for regulations including the Corporate Sustainability Reporting Directive (CSRD). Developed with PwC, the module integrates with existing enterprise systems used by manufacturers, energy companies, and construction firms.

The release represents a shift in how businesses manage environmental data. Instead of relying on spreadsheets and manual calculations, companies can now track carbon emissions, resource consumption, and waste metrics within the same platform they use for operations. For UK SMEs in regulated industries or those bidding for public contracts, this matters because accurate sustainability reporting is becoming a commercial requirement, not just a compliance exercise.

IFS appointed Sophie Graham as Chief Sustainability Officer in January 2024. Graham previously held sustainability roles at Santander UK and Fujitsu. She brings experience in environmental law and responsible business strategy across European and American markets. Under her leadership, IFS has aligned its internal decarbonisation targets with customer-facing technology development.

The company’s own emissions reduction plan has approval from the Science Based Targets initiative (SBTi). This certification requires businesses to demonstrate how their targets align with climate science. However, the commercial focus now centres on helping customers measure and reduce their own environmental impact through better data management.

New platform features address regulatory compliance gaps

The IFS Cloud Sustainability Management module launched on 15 October 2024 as part of the 24R2 release. It offers a centralised system for collecting environmental data from multiple sites and operations. The module includes pre-configured key performance indicators (KPIs) that align with CSRD requirements and the Greenhouse Gas Protocol.

CSRD applies to large companies and listed SMEs operating in the EU. It mandates detailed environmental disclosures, including emissions across all three scopes. Scope 1 covers direct emissions from owned sources like company vehicles and facilities. Scope 2 includes indirect emissions from purchased electricity and heating. Scope 3 encompasses all other indirect emissions, including supply chain activities, business travel, and product lifecycle impacts.

Many businesses struggle with Scope 3 reporting because it requires data from suppliers, logistics providers, and distributors. The IFS module addresses this by connecting emissions tracking to supply chain management systems. When a company records a purchase order or freight movement, the system can automatically calculate associated carbon impacts based on industry standards and supplier data.

The platform also supports customised sustainability plans. Companies can set reduction targets, track progress against baselines, and generate reports for regulators or tender submissions. For example, a manufacturing business might track energy consumption per unit produced, waste sent to landfill, and water usage across production lines. The system aggregates this data and presents it in formats required by different reporting frameworks.

PwC collaborated on the module development. The consultancy provides advisory services to help businesses implement the software and interpret the data it generates. This partnership aims to reduce the time between software deployment and meaningful reporting outcomes.

AI-driven emissions tracking automates Scope 1 to 3 calculations

IFS plans to release version 25R1 in 2025. This update includes over 200 enhancements driven by artificial intelligence. The centrepiece is an Emissions Tracker that automates carbon accounting across all three scopes. Instead of manually gathering data and applying emission factors, the system pulls operational information from connected modules and calculates carbon impacts in near real time.

The tracker uses time series forecasting to predict future emissions based on current trends. For instance, if a company plans to increase production by 20%, the system can estimate the corresponding rise in energy consumption and associated emissions. This helps businesses model the carbon impact of growth scenarios before committing to expansion plans.

Explainable AI features provide transparency about how calculations are made. When the system generates an emissions figure, users can see which data inputs, emission factors, and assumptions contributed to the result. This matters for audits and external verification, where regulators and certification bodies need to understand the methodology behind reported numbers.

The IFS.ai Copilot functions as a conversational interface for sustainability queries. A supply chain manager might ask, “Which suppliers contribute most to our Scope 3 emissions?” The system analyses purchasing data, freight movements, and supplier carbon intensity to provide a ranked answer. Similarly, a field service coordinator could query, “How can we reduce fuel consumption on maintenance visits?” The copilot might suggest route optimisations or vehicle replacements based on usage patterns.

Predictive maintenance capabilities reduce waste and emissions by preventing equipment failures. Sensors and usage data feed into models that forecast when machinery needs servicing. Addressing issues before breakdowns occur cuts unplanned downtime, emergency call-outs, and the carbon cost of rushed repairs or replacement parts.

Manufacturing and energy sectors gain circular economy tools

The platform includes features designed for circular manufacturing. This approach extends product lifecycles through repair, refurbishment, and remanufacturing. Companies can track components through multiple use cycles, recording condition, maintenance history, and remaining useful life. When products return from customers, the system determines whether parts can be refurbished for resale or must be recycled.

Remanufacturing generates revenue while cutting emissions. Producing a refurbished component typically requires less energy and raw material than manufacturing a new one. For businesses with repair operations, the module tracks inventory of reusable parts and manages warranties for refurbished products.

Packing material management addresses waste from logistics. The system monitors reusable containers, pallets, and packaging across distribution networks. When a delivery arrives at a customer site, the system records which packaging was used. If containers are reusable, it schedules their return and tracks them for the next shipment. This reduces spending on single-use packaging and the emissions associated with manufacturing and disposing of cardboard, plastic, and foam.

Energy companies and utilities benefit from asset management integration. The platform connects sustainability metrics to enterprise asset management (EAM) systems. An energy provider might track the carbon intensity of power generation assets, maintenance schedules for renewable installations, or grid efficiency improvements. Field service teams receive AI-generated recommendations for reducing travel emissions during site visits.

Construction firms can use the module to report on project-level sustainability. Each development site becomes a data collection point for materials used, waste generated, fuel consumed, and transport emissions. Project managers access dashboards showing environmental performance against targets. This helps when tendering for contracts that require sustainability credentials or when reporting to investors focused on environmental, social, and governance (ESG) criteria.

Core facts about the IFS Cloud sustainability release

• IFS released the Sustainability Management module on 15 October 2024 as part of the 24R2 cloud platform update.
• The module was developed in partnership with PwC and includes pre-configured KPIs for CSRD and Greenhouse Gas Protocol compliance.
• Sophie Graham joined IFS as Chief Sustainability Officer on 25 January 2024, bringing experience from Santander UK and Fujitsu.
• Version 25R1, planned for 2025, adds an Emissions Tracker with automated Scope 1 to 3 reporting and AI-driven forecasting.
• The platform integrates with ERP, supply chain management, asset management, IT service management, and field service modules already used by IFS customers.
• Circular manufacturing features track components through repair and refurbishment cycles to reduce waste and generate revenue from remanufactured products.
• IFS has SBTi-approved science-based emissions reduction targets for its own operations.

Implications for UK businesses facing procurement and compliance pressure

For UK SMEs, the expansion of sustainability software tools reflects a broader market shift. Public sector procurement increasingly requires carbon reduction plans. Suppliers bidding for central government contracts must demonstrate net zero commitments and report on Scope 1 and 2 emissions as a minimum. Many tenders now request Scope 3 data as well, particularly in sectors like construction, facilities management, and transport.

Private sector clients are following suit. Large corporations with their own net zero targets need supply chain partners who can provide emissions data. Consequently, smaller suppliers face pressure to measure and reduce their environmental impact or risk losing business to competitors who can meet these requirements. Software that automates this reporting reduces the administrative burden and ensures consistency across submissions.

Compliance costs matter for businesses evaluating whether to invest in sustainability management systems. The IFS module represents a capital expenditure decision, though the company has not published pricing. Firms must weigh software costs against potential benefits including tender success rates, operational efficiencies, and reduced risk of regulatory penalties. For companies already using IFS Cloud for operations, adding the sustainability module may be more cost-effective than implementing a standalone environmental management system.

Data quality remains a critical factor. Automated emissions tracking depends on accurate operational data inputs. If a company’s existing systems contain gaps or errors, the sustainability module will propagate those flaws into carbon calculations. Consequently, businesses need reliable data governance before deploying advanced reporting tools. This often requires upfront work to standardise how energy use, materials consumption, and waste are recorded across sites and departments.

The AI-driven forecasting features help with scenario planning. A manufacturer considering equipment upgrades can model how different investments affect energy consumption and emissions. A logistics company evaluating electric vehicle adoption can compare the carbon and cost impacts of various fleet transition timelines. This capability supports capital allocation decisions by quantifying environmental outcomes alongside financial returns.

Supply chain transparency poses challenges, particularly for Scope 3 emissions. Many suppliers lack sophisticated carbon accounting capabilities. They may provide estimates based on industry averages rather than specific data from their operations. The IFS platform can incorporate supplier-provided emissions data when available, but businesses should expect variability in data quality across their supply base. Building supplier engagement programs to improve environmental data sharing becomes part of the implementation process.

Where UK businesses can find regulatory guidance and support

The UK government publishes guidance on greenhouse gas reporting through the Department for Energy Security and Net Zero. The government conversion factors for company reporting provide emission factors for activities including transport, energy use, and water consumption. These factors are updated annually and align with international standards.

For businesses preparing for extended producer responsibility and waste reporting, the Environment Agency offers detailed guidance. The environmental permits section on gov.uk covers regulatory requirements for different industries and operational scales.

Companies pursuing science-based targets can access resources from the Science Based Targets initiative. The organisation provides tools and criteria for setting emissions reduction goals consistent with climate science. UK businesses can review case studies and technical guidance relevant to their sector.

Trade associations often provide sector-specific sustainability resources. Make UK represents manufacturers and publishes guidance on environmental compliance and operational efficiency. The Chartered Institute of Procurement and Supply (CIPS) offers resources on sustainable procurement practices and supplier engagement strategies.

For practical support with carbon reporting and net zero planning, SBS provides compliance services for ESG reporting tailored to UK SMEs. Our approach focuses on meeting procurement requirements, managing regulatory obligations, and identifying cost reductions through operational improvements. We also deliver training through SBS Academy on topics including Scope 3 emissions measurement and supply chain engagement.