Addressing climate risk is an opportunity to drive value
FOR ANY major global company – in our case as the world’s leading logistics provider – the commitment to go emissions-free by 2050 tends to trigger one of two reactions. Some regard it as a public relations ploy, others think setting such a goal is overly optimistic.
I think both reactions are wrong. Making such a commitment is simply inevitable. Climate change is a clear risk to the value of all companies anywhere.
At the same time, the true potential to combat climate change will only be achieved once human ingenuity and the resource efficiency of the market are fully tapped.
For that reason, business leaders increasingly understand that addressing the climate risk is not just a cost imposed on them. It is also an opportunity to drive value through new business models and investment in new technologies.
The goal of COP 23, this year’s UN climate change conference – currently held in Bonn, Germany, the city where our company’s global headquarters are located – is to become very specific on how to achieve a positive outcome for the environment.
That challenge is also very much addressed to large corporations. Based on what I have learnt since 2008, when we first established specific commitments to reduce our global emissions, I would point to four key lessons:
First, the commitment to go emissions-free requires a fundamental rethink of many business activities. For us, re-evaluating everything through the prism of sustainability has given a new quality to our relationship with suppliers and customers.
For example, our aerodynamically designed Teardrop trailers, used for longhaul road transport, reduce fuel consumption as well as carbon emissions. Beyond our own company’s needs, we work with our customers to create tailor-made versions for them.
Second, precisely because there is no silver bullet, one must launch many concrete steps rapidly and systematically. These efforts start with such little steps as switching to LED lighting in our facilities worldwide and rediscovering the benefits of relying on bicycles for urban delivery to the maximum extent possible.
Third, success depends at least as much on solutions flowing bottom-up inside each company as top-down. Start-up labs, which capture promising ideas from rank-and-file employees, play an important role in that regard.
Fourth, a company prepared to undertake a fundamental rethink of its established way of doing business may well discover transformative solutions that yield new businesses with true long-term potential.
As for us, we have become e-entrepreneurs. Operating a total fleet of 92 000 delivery vehicles, a central task on our 2050 agenda is to move beyond our reliance on diesel-powered delivery vehicles and shift to electric vehicles.
Such e-vehicles have to be as robust as diesel vehicles in handling heavy loads, able to sustain the stresses of constant stopand-go traffic on urban delivery routes, and reliable enough to be used up to 300 days a year.
When we could not find a suitable provider in the market place, we linked up with a university-based start-up, StreetScooter, which we subsequently acquired. We are now building out its initial product to a full range of electric vehicles and expanding its production capacity from 10 000 vehicles this year to 20 000 in 2018.
An important motivation for us is to demonstrate that e-mobility can become standard practice in the global logistics industry and beyond. That is why, after scaling up in Germany, we are now beginning to roll out this solution globally. In addition, since StreetScooters can be adapted to the sector-specific delivery needs of other industries, they can provide urban mobility solutions on a much broader basis.
To reduce our company’s emissions and noise profile further, we also put great emphasis on e-bikes and e-tricycles. We currently use them in 58 cities in 12 different European countries, including France, Italy, the UK and the Netherlands.
For us, the full-scale implementation of these various measures is key to reaching an important milestone for 2025 – that 70 percent of our first-mile pick-up and final-mile delivery services will be emissions-free.
There is no doubt that meeting our own 2050 net-zero emissions commitment will become incrementally harder. For the road ahead, I am greatly encouraged by one unexpected fact: Responding to the climate challenge goes far beyond addressing “just” environmental issues.
As I have learnt first hand, green initiatives lead to new forms of productivity and over time the creation of entirely new markets with increasing demand for sustainable solutions.
Bold aspirations are necessary, however, to catalyse this process. This is the way in which business can – and must – lead the transformation that’s required globally.
Green initiatives lead to new forms of productivity and over time the creation of entirely new markets with increasing demand for sustainable solutions.