Corona does not weaken sustainability

Martin Schrüfer,

"Greening" logistics and supply chains? Kühne Logistics University says: Yes!

Are logistics and supply chains "greening"? A recent study by the new Center for Sustainable Logistics and Supply Chain (CSLS) at Kühne Logistics University (KLU) in collaboration with The European Freight & Logistics Leaders' Forum (F&L) shows: Despite corona, the decarbonization of logistics in Europe is underway and is being integrated into companies' strategic planning. Nevertheless, many companies are still at a relatively early stage of the process. The study provides evidence that companies are continuing their greener transformation despite the COVID-19 crisis.

Prof. Alan McKinnon, one of the authors of the study. © KLU/Christian Schwarzer

The report "Measuring Industry's Temperature: An Environmental Progress Report on European Logistics" summarizes the results of a survey of more than 90 executives involved in the management of European logistics systems, including case studies from Procter & Gamble, Stora Enso, Kuehne+Nagel, Vlantana, Tata Steel, Saint-Gobain Isover, Transporeon, Bertschi and LKW Walter.

One third of companies pursue a sustainability strategy and concrete emission reductions

Overall, the decarbonization process in Europe is well underway. More than half of the companies surveyed already have a sustainable logistics strategy or are in the process of introducing one. In the study, 30 percent of the companies surveyed were categorized as "leaders" in sustainable logistics: They already have corresponding strategies in place or are in the process of implementing them and they have already set absolute CO2 reduction targets for their logistics operations and are able to measure the associated CO2 emissions in a differentiated manner. At the other end of the scale are 15 percent of companies that do not currently measure their logistics emissions. One third have not yet set any targets for reducing emissions.

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Corona does not weaken sustainability

Almost 70 percent of all respondents, and 87 percent in the "leading" category, stated that their companies' recovery from the COVID-19 crisis has had either no or even a positive impact on their decarbonization efforts. Prof. Alan McKinnon, one of the authors of the study, explains: "The study clearly shows that the Covid-19 crisis has so far not weakened or reversed companies' efforts to decarbonize their logistics."

Ecological and commercial goals go hand in hand

60 percent of respondents who were classified in the "leading" category assume that at least half of their CO2-reducing measures will also save costs. The three most cost-effective ways are: shifting freight from road to rail, improving vehicle utilization and switching transport operations from fossil fuels to renewable energy.

Three quarters of those surveyed assumed that digitalization will have a transformative impact on logistics in the next five years. They see the greatest IT contribution coming from improved supply chain transparency, advances in transport management systems, innovations in vehicle utilization and online logistics platforms.

Responsibility for decarbonization

"By and large, logistics service providers seem to have a greater ability to measure and manage the decarbonization process, unlike users," says Prof. Moritz Petersen, Director of CSLS and co-author of the study. Nevertheless, companies could exert more ecological influence on the logistics process through their procurement processes.

Net zero logistics requires much greater sharing of logistics assets, but this is still hampered by a number of constraints. Respondents cited competitive pressures, management culture, data privacy concerns and lack of trust as the biggest barriers to greater collaboration.

The report contains a series of recommendations for the various players in the European logistics industry.

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