April 22, which fell last week, was Earth Day – when people all around the world were encouraged to think and take action to help the environment and mitigate the effects of climate change. But while Earth Day provides a focal point and a catalyst for change, there are steps that businesses can (and should) be taking year round to address their resource consumption.
Many companies are drowning in paper, and nowhere is this more evident than in the Accounts Payable department. Of the approximately 350bn bills and invoices sent globally each year, around 330bn (or more than 94%) are sent as paper invoices. These create business as well as environmental problems, increasing costs, inefficiencies, errors, and more.
However, by switching to e-invoicing and automating financial processes, companies can gain greater visibility and control over spend and working capital, as well as improve their supplier relationships. Moreover, they can contribute to substantial environmental savings. If all 330bn paper invoices were sent electronically, we’d see global savings of 138.6m trees and 143bn litres of water each year. That’s a reduction in the carbon footprint of every invoice by 63%.
With this in mind, there are four key steps we’d recommend that businesses take in order to bring about greener practices in their Accounts Payable departments.
Send invoices electronically through cloud-based business commerce networks. Plus, make the most of services such as supplier on-boarding and supplier portals to encourage environmentally friendly practices among your trading partners.
Order through e-catalogues, not paper catalogues. Additionally, identify and purchase from suppliers that support environmentally friendly initiatives.
Look for ways to make payments electronic. Innovative e-payment solutions are on the rise and can speed up slow invoice processing tasks, ensuring that suppliers get paid quickly without tougher terms for buyers.
Strive for continual improvement. Use analytics to measure key metrics in your green initiatives, as this will provide insight into other ways you can work smarter, achieve greater green benefits, and take performance to new levels.
These steps create a win-win situation for both the economy and environment and should be an easy decision for businesses to make. But paperless invoicing is not only a matter of businesses ‘doing good’. They’re also, quite simply, good business.