Earth Day 2023: The Ongoing Push for Sustainable Logistics
The e-commerce industry, which has seen a surge in demand over the past few years, plays a significant role in shaping our environmental impact. As consumers increasingly rely on online shopping, e-commerce logistics must strive to minimize their carbon footprint and invest in a more sustainable future for our planet.
In celebration of Earth Day 2023, we reconnected with some of the top sustainability experts in e-commerce logistics to learn more about the new initiatives undertaken by their companies in the last couple of years and if priorities have changed in their fields. Here’s what they have to say:
#1: Suhas Singh, Regional Logistics Sustainability Manager Asia & Pacific, H&M Group
Suhas Singh is a seasoned sustainability professional with 14 years of experience working In the apparel and textile Industry. Since joining the H&M Group 11 years ago, Suhas has worked in different parts of the organization, starting out in business, and moving on to sustainability in roles as Sustainability developer, Environmental Program leader and more recently as a Regional Logistics Sustainability Manager Asia & Pacific.
During our interview last year, Suhas highlighted H&M Group's commitment to sustainability as an essential aspect of its business model, and it seems that this dedication remains unchanged this year. In fact, the Group has recently collaborated with its various partners to implement sustainability initiatives and improve its performance in creating a circular and climate-positive supply chain, while also ensuring fairness and equality for those associated with its business. Just in 2022 alone, the company spent approximately SEK 2.6 billion on decarbonization efforts, including energy efficiency investments in its stores, supporting its suppliers to phase out coal, and increasing the share of more sustainably sourced materials.
“To name a few of our climate initiatives in transportation, for China, 31 cities are using e-truck for last mile delivery and covering 53.4% of the retail store cartons/totes. As for online operations in China, we have over 90% of parcels delivered by electric bikes and we have moved from road to rail in 5 China provinces accounting for 26,222 retail store cartons/totes. We are also constantly monitoring the opportunities and similar initiatives in the rest of the markets as well including Hydrogen, LNG, and Biofuels,” Suhas elaborated.
That being said, there are many significant challenges when it comes to scaling up the use of low-emission fuels, particularly in markets with inadequate service providers and infrastructure like charging stations. Despite these challenges, the H&M Group remains committed to its sustainability goals and believes that collaboration and innovation are essential in finding viable solutions that benefit both the environment and the industry as a whole. Therefore, the company is actively exploring new technologies and alternative approaches to reduce emissions in its operations, supply chain, and products, in addition to collaborating with its peers and stakeholders to create a sustainable future.
#2: Florian Schwarz, Head of Sustainability, DHL Customer Solutions & Innovation
As the Head of Sustainability in DHL Customer Solutions & Innovation (CSI), Florian Schwarz is responsible for driving the ESG Roadmap for and with the top 100 customers across the Deutsche Post DHL Group divisions. This includes achieving a GHG emission reduction through the GoGreen Plus product portfolio of clean fuel & technology, as well as supply-chain optimization, and circularity solutions.
According to Florian, sustainability has always been a top priority for Deutsche Post DHL Group, and recently an increasing number of customers are taking this issue more seriously, especially due to new or upcoming regulation on sustainability reporting and Science Based Targets which those organizations have committed towards. As part of its efforts towards sustainable logistics, Deutsche Post DHL Group has pledged to invest up to 7 billion euros for sustainable measures to reduce its logistics-related emissions below 29 million tonnes of CO2 emissions by 2030. In 2022, the Group was able to spend 284 million euros on sustainable fuels and technologies, e.g. for E-vehicles and in buildings. Furthermore, the organization recognizes the significance of investing in the education of their employees and customers as a crucial catalyst to accelerate progress sustainability for all stakeholders.
When asked about Deutsche Post DHL Group’s success in their pursuit of meeting their sustainability objectives, Florian shared the following: “We have defined specific and measurable milestones along all E/S/G dimensions in order to meet our mid and long term targets. One critical success factor here is certainly that our board of management has 30% of their bonus tied to meeting ESG targets. Specifically on reducing emissions we are also on track for our commitments in line with SBTi." He also added that some obstacles encountered were “the availability and price of the means to drive decarbonization, namely trucks (electric or other alternative fuel) as well as sustainable aviation fuel.”
#3 Zsófia Agnes Nagy, Sustainable Supply Chain Adviser, BZLW GmbH
With over 20 years of strategic and operational leadership experience in global value chain setups, Zsofia Agnes Nagy has helped companies across different industries become sustainable, yet remain profitable. As an independent supply chain professional, Zsofia offers an objective pair of lenses and has consistently delivered results throughout her career. Specializing in transformation programs, sustainable supply chain solutions, and organizational development, Zsofia takes pride in having empowered several individuals to live their best professional lives through functional coaching at all levels of seniority .
During the interview, Zsófia provided a comprehensive list of areas BZLW GmbH typically works on. These include sustainable sourcing frameworks, LCA of product portfolios in SME/startup companies, end-to-end planning, sustainability education, value chain analysis for GHG scope 1-2-3 (currently under implementation), and evaluation of sustainability in supply chain strategy.
With regards to challenges that the company has faced while striving to meet their sustainability objectives, Zsófia noted three main ones. First and foremost, there is a lack of understanding and buy-in at the board level for solutions, which are mostly considered as novel or not concepts proven with larger companies. Secondly, there is a lack of relevant and effective legislation globally, with some legislations going against sustainable solutions. Lastly, tight budgets at supply chain and operative areas can only be overcome by conscious budget and resource allocation.
As for how BZLW GmbH is investing in sustainability this year, Zsófia mentioned the following:
“We have been and will continue investing into startups, scaleups and SME companies to further sustainability education, as well as work with them pro bono to help them overcome critical gaps that hold them back from taking tangible actions. These are usually considerable time and effort investments to help these companies. We are also mentoring startups to ensure they are already sustainably set up as much as possible from the get go or even better, pursue an already sustainable business model and make it successful. These will serve as examples to many larger organizations as well.”
Towards a More Sustainable Future
Did you know that 68% of shoppers plan to base their future purchases on whether or not a brand is committed to sustainability? As the world becomes increasingly aware of the negative consequences of climate change, customers, investors, and regulators are all placing greater emphasis on sustainable business practices. Companies that prioritize sustainability are not only doing their part to protect the planet, but are also positioning themselves for long-term success in a rapidly changing business landscape. Ultimately, by working together to create greener logistics, we can build a more sustainable future for ourselves and future generations.
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