As many of us in the supply chain industry continue to worry about high fuel costs, inflation, the labor shortage, and new waves of Covid-19 variants, I think we have an even more pressing problem—the record heat waves that are burning up large swaths of the planet this summer. We’ve understandably been distracted for the past two and a half years by the pandemic and its impact on our supply chains, yet Mother Nature seems to be sending more frequent and urgent messages lately. For shippers and carriers, the time is now to step up their sustainability efforts before it’s too late.
In the 2022 “State of Logistics Report,” released in June by the Council of Supply Chain Management Professionals (CSCMP) and global consulting firm Kearney, and presented by Penske Logistics, the authors point out that in the past century, global temperatures have increased an average of 0.13 degrees Fahrenheit each decade. This alarming figure has not gone unnoticed by the logistics and supply chain community. Large carriers are implementing a wide range of sustainability programs, from reducing carbon in packaging to using clean energy in their facilities and moving toward sustainable aviation fuel. Big shippers are looking to do their part as well. For example, Unilever has set an aggressive goal of reaching net-zero emissions by 2039 by transitioning to renewable energy and adopting sustainable practices throughout its logistics network.
Another encouraging trend noted in the report is “a growing movement toward a new standard called ‘Scope 3.’” As the report explains, Scope 3 “is an internationally recognized metric for measuring emissions not only within a single organization, but across its entire value chain.” Released in 2011, Scope 3 was developed to help shippers and carriers work together toward shared sustainability goals. As more companies adopt Scope 3, shippers can use these emissions metrics to assess their suppliers’ sustainability practices, while carriers can use their Scope 3 expertise and capabilities to differentiate themselves from the competition, the report’s authors say.
In addition to Scope 3, the authors also point to the Science Based Targets initiative (SBTi), a measurement tool that companies can adopt alongside their suppliers and customers to set common goals and track carbon impact together. A recent study of company executives from SBTi-committed businesses revealed that one-third saw a positive effect on their bottom line, while more than 50% believe that the SBTi initiative gives them a competitive advantage.
While it’s clear that companies are working aggressively to reduce greenhouse gas emissions, are all these efforts enough? It certainly seems like the industry is heading in the right direction. Hopefully, more shippers and carriers will work together to synchronize their supply chain sustainability goals.
If they can keep the momentum going, we just may be able to reach those greenhouse gas reduction targets. The report’s authors seem optimistic that “interconnected objectives and joint Scope 3-SBTi tracking could accelerate the attainment of net-zero emissions … well in advance of standard 2050 timeline aspirations.” Let’s hope they are right.
To download the full “State of Logistics Report,” visit cscmp.org.
Gartner, Inc.