The EU’s Carbon Border Adjustment Mechanism (CBAM) is moving beyond a regulatory reporting exercise. From 2026 onwards, emissions embedded in imported goods carry real, measurable cost exposure. To help customers navigate it, SAP is introducing an integrated, end-to-end CBAM solution that starts with CBAM declarants, built on SAP Sustainability Footprint Management and SAP Green Ledger, and will expand to fully support operator needs.
Companies need to quantify those emissions, recognize liabilities, withstand audit scrutiny, and, ultimately, prepare to settle carbon costs through certificates linked to the EU Emissions Trading System.
In practical terms, carbon becomes a priced input, one that directly affects margins, cash flow, and sourcing decisions in a way that is comparable to other cost drivers.
Why CBAM matters now
CBAM cuts across business functions. Finance teams manage liabilities and forecast costs. Procurement teams need emissions data from suppliers and must incorporate it into sourcing decisions. Trade and compliance teams ensure imports are correctly classified and reported.
No single function can manage this in isolation. The financial implications depend on operational data, and operational decisions increasingly depend on carbon cost exposure.
The regulation initially applies to imports of iron and steel, aluminum, cement, fertilizers, hydrogen, and electricity, with a threshold of more than 50 tonnes annually for declarants. While this concentrates formal obligations on larger importers, the effects extend into supply chains as companies request more detailed and verified emissions data from suppliers and adjust sourcing decisions accordingly.
From reporting to financial exposure
What changes in 2026 is not only what companies must report, but what follows from it. Imports of CBAM-covered goods into the EU create a carbon liability for authorized declarants based on their verified embedded emissions. Those liabilities accumulate throughout the year and must be reported, audited, and settled through the purchase and surrender of CBAM certificates in 2027.
This creates an ongoing compliance cycle with clear financial implications:
- Emissions must be tracked and translated into certificate requirements.
- Liabilities accumulate throughout the year.
- Certificates must be purchased, managed, and surrendered to cover those liabilities.
For finance, this means ongoing exposure that needs active management. For procurement and supply chain teams, costs now hinge on supplier emissions data.
An integrated approach to CBAM
Decarbonize your value chain with carbon accounting software from SAP
Many organizations are currently managing CBAM across multiple systems, spreadsheets, and manual processes. That approach becomes difficult to sustain under audit and as volumes increase.
SAP’s approach brings together the key elements of CBAM management into a connected process: data collection and mapping, emissions and cost calculation, analytics, carbon and financial accounting of liabilities, certificate asset management, and declaration generation.
SAP will offer an integrated, end-to-end CBAM solution for declarants, designed on SAP Sustainability Footprint Management and SAP Green Ledger. This builds on SAP’s strengths in carbon and financial management.
This new approach allows companies to move away from fragmented workflows toward an integrated solution tied to core business processes.
Coming soon: End-to-end CBAM data capture and calculation with SAP Sustainability Footprint Management
SAP Sustainability Footprint Management will provide the operational backbone for CBAM by helping to establish a reliable data foundation. At its core will be customs data, such as import records and CN code classification, sourced from SAP Global Trade Services and other trade systems. Without that layer, companies struggle to identify where CBAM applies.
Building on this foundation, SAP Sustainability Footprint Management will help centralize CBAM-relevant ERP, trade, and supplier data in one place; ingest supplier emissions data via Excel uploads with automated interpretation; and calculate embedded emissions, certificate requirements, and estimated CBAM costs. A dedicated CBAM dashboard will allow organizations to analyze emissions and cost exposure, while built-in reporting capabilities support the generation of CBAM reports ready for submission to EU authorities.
Available today: Financial control of CBAM exposure with SAP Green Ledger
A critical differentiator in CBAM readiness is the ability to connect carbon data with financial processes. Today, with SAP Green Ledger, companies can track the number of certificates required, valuate them as financial liabilities, continually revaluate based on price changes, and post financial impacts to the appropriate accounts. This is the level of traceability finance teams and auditors expect, in line with the International Accounting Standards.
This integration enables organizations to:
- Recognize, valuate, and periodically revaluate CBAM liabilities.
- Track certificate holdings and their valuation (coming soon).
- Support audit-ready reporting and verification.
- Forecast and plan for cash impacts (coming soon).
- Break down and manage costs on a product level (coming soon).
Most organizations still treat operational data and financial impact as separate. These capabilities can bring them together.
Beyond compliance: enabling better decisions
While CBAM is often framed as a compliance burden, it also provides an opportunity to improve decision-making. When carbon costs are visible and integrated into business processes, companies can see exactly where exposure sits and where action will make the biggest impact.
With better data, organizations can:
- Identify high-cost emission hotspots in their supply chains.
- Evaluate supplier choices based on emissions and cost trade-offs.
- Improve forecasting and budgeting of carbon-related costs.
- Reduce reliance on conservative and costly default values by using actual data.
This does not remove the cost, but it can make it easier to manage and, in some cases, reduce.
What to focus on now
As CBAM has entered its definitive phase, the immediate priority is building a reliable data foundation. That includes accurate customs data and clear mapping of where CBAM applies. Supplier engagement is another practical constraint. Collecting verified emissions data often requires structured outreach and follow-up. Tools such as SAP Sustainability Data Exchange can support with supplier communication and data collection, but the effort remains organizational as much as technical.
From there, organizations can assess their CBAM exposure, ensure the necessary data flows are in place, and plan their solution architecture to optimize total cost of ownership, automation, and integration into business functions. It continues with ensuring that emissions calculations are traceable and auditable. That influences behavior; carbon now drives planning, which no team can ignore.
At the same time, companies need to define how CBAM data flows into finance. Linking emissions, liabilities and certificates to financial systems early helps avoid rework and reduces audit risk.
What’s next
CBAM is a broader shift in how environmental impact is reflected in business performance. Carbon is tracked, priced, and managed alongside other cost drivers.
Organizations that treat CBAM as a periodic reporting task will likely remain reactive. Those that integrate it into financial and operational decision-making will be better position to manage its impact.
For more information, visit sap.com/carbonaccounting.
Gunther Rothermel is chief product officer for SAP Sustainability.
Get the latest SAP news delivered to your inbox once a week
