Value chain

Make ESG second nature across the logistics value chain

Anjali BhadbhadeCFO, DHL Express India spoke to Rusen Kumar, India CSR on Making ESG second nature across the logistics value chain at DHL Express India.

Logistics companies need to accelerate their green efforts by increasing the efficiency of supply chain processes.

In today’s rapidly changing business climate, attention to environmental, social and governance (ESG) concerns has become essential for competitiveness, but more importantly, for the benefit of people and the planet. . Since the pandemic, ESG has also risen to the top of regulatory agendas. This has made organizations realize that ESG accountability is a way to give back to society and improve corporate culture and employee engagement.

As a global logistics leader, we are responsible for reducing our company’s carbon footprint and implementing the highest social and governance standards. Sustainability is our duty and the decisions we make today can have a positive impact tomorrow. Logistics companies need to accelerate their green efforts by increasing the efficiency of supply chain processes.

Green logistics policies have a strategic advantage over the competition. Not only do they set businesses apart, but they also prepare them for a sustainable future. The logistics sector is a big carbon emitter. In fact, 70% of Deutsche Post DHL Group’s greenhouse gas emissions are generated by the air transport network.

As a result, major logistics players like us are making deals for sustainable aviation fuels to reduce the carbon footprint. Additionally, it has been found that millennials are expected to pay more for products that have been produced and delivered in a sustainable manner. Thus, to be more eco-responsible, logistics companies are increasingly adopting decarbonization strategies using digitalization.

Apart from hardware-based trends like robotics, these are essentially software-based technologies that take advantage of substantial change in processes, operations, and functions. Logistics companies are also exploring options such as electric cargo planes for sustainable aviation in the future. In a pioneering initiative, DHL Express has ordered 12 electric aircraft, Alice, to be delivered by 2024 to form an unparalleled electric network of cargo aircraft and commit to achieving net zero emissions by here 2050.

Given the nature of the logistics business, we work with multiple stakeholders and communities. As logistics players expand their operations, providing community wellbeing is our way of giving thanks and showing our appreciation to the communities in which we operate. Hiring locals ultimately gives a boost to the economy and increases the GDP of the country.

In addition to hiring locals, the logistics industry, which used to be male-dominated, is changing by hiring more women and championing diversity and inclusion. In India, we have added 19 women to the frontline operations team this year and aim to increase the share of women employed to 25% by 2027. The industry is also working with the government to adapt logistics infrastructure and hiring processes to support people with disabilities. , and I think we will soon see the results.

Many logistics players also contribute to society by providing education to marginalized children and guidance to disadvantaged women to help them become successful entrepreneurs. Logistics also helped disaster response teams deliver relief to flood-prone areas. Logistics has played an indispensable role during the pandemic in the delivery of life-saving vaccines and other personal protective equipment.

We live in a global village where businesses work in a connected ecosystem. Therefore, global logistics players operating in several different countries must adhere to trade rules and regulations related specifically to each region. These trade laws can be overwhelming for MSMEs. To address these issues, we have implemented “Yellow Yatra” to help businesses understand the shipping process and compliances required for international trade. Along the same lines, DHL has specifically designed a website called Trade Automation Service (TAS) to help companies understand landed costs in different countries and to help companies price their products accordingly.

Speaking of positives for the industry from a governance perspective, the recently announced National Logistics Policy effectively addresses supply chain constraints, resulting in lower logistics costs and greater competitiveness of Indian products globally. global scale. It effectively creates a one-stop electronic logistics market and focuses on the seamless movement of goods across borders. Highlighting the need for paperless EXIM technology and business processes will significantly solve the current hurdles in the logistics industry. The policy has the potential to improve different sectors of the economy and place significant importance on the ease of doing business.

In my opinion, the policy was essential to sustainably revolutionize the logistics industry over the next decade. This follows a report by the World Economic Forum, which predicted that by 2030, the growth of e-commerce alone will drive 36% more delivery vehicles, generating an additional 32% of carbon emissions. Currently, a truckload’s worth of plastic, from product parts to packaging, enters the ocean every minute. This will quadruple by 2050 if no action is taken today. With these predictions, companies, governments and customers must make ESG an integral part of the logistics industry. This serves the business proposition and facilitates growth, attracts great talent and builds trust between stakeholders.