How the transport & logistics sector can meet ESG targets

We live in a time where all businesses, across every sector, are expected to play their part in reducing their carbon emissions and joining the fight against climate change. Authorities all over the world are pressing businesses to take action, such as in the UK, where the Government has committed to reaching net-zero emissions by 2050.

However, the demand on the transport and logistics sector to operate more sustainability is particularly acute: this is because of the large amounts of energy needed by the sector, and its historical reliance on fossil fuels. According to the International Energy Agency, transport and logistics accounted for 37% of all CO2 emissions worldwide in 2021.

This means that having an effective strategy around ESG (Environmental, Social and Governance) is an absolute must for every transport and logistics organisation. This blog highlights why an ESG plan is so important, and some of the sustainable processes that can simultaneously cut emissions and improve business efficiency.

Why ESG is so critical for the transport and logistics sector

There are a number of reasons that an ESG strategy is now essential, even beyond any legal requirements for sustainable operation that governments may put in place. There is also an increased social and moral expectation for companies to demonstrate a genuine commitment to sustainability; and those who don’t will suffer from reduced revenue and reputational damage as customers and suppliers go elsewhere. Furthermore, with many investors prioritising green investment opportunities, the ability to attract new funding will be restricted.

On a more practical level, an ESG strategy can help companies explore areas to reduce emissions and find efficiencies in every part of their operations. Transport and logistics companies tend to have lengthy and complex supply chains, and there are often opportunities to make changes at every stage within them.

Improving business efficiency through more sustainable processes

Every transport and logistics business is different, and so sustainability initiatives that will yield major benefits for some will not necessarily be viable for others. However, these three changes are widely suitable for most organisations within the sector, and can be relatively simple and cost-effective to implement:

• Consumption monitoring: the first place to start in understanding where to reduce energy consumption, is to accurately measure how much energy is used by different operations and processes. Methodologies and tooling can be deployed to monitor operations, and track the energy implications of any changes that have been made.
  
  A good example is where a business implements a new printing policy that restricts all non-essential printing, such as email trails, single-sided printing, or colour print jobs over a certain size. The reduced workload on printers can be measured and quantified, and environment-focused dashboards can then display the level of savings made in terms of energy and emissions. This can help gauge improvements and increase awareness of the environmental impact of certain activities, as well as identifying which business processes are generating the biggest print burden.
• Workflow mapping: this helps an organisation identify the number of manual steps in a process, including printing, annotating, scanning, and manual data entry into other systems for data capture. Using this insight, it’s then possible to pinpoint business processes that can be digitised and automated simply by monitoring consumption.
• On-site scanning: connected to the previous point, the production of paper documents has a major environmental impact outside of printing. As well as the trees that need to be cut down to make the paper (or the energy needed to make recycled paper), businesses themselves also have to invest in space and filing systems for storing paper documents. There’s also the energy implication of heating, lighting and ventilating these environments.
  
  A digitised approach to file scanning and archiving can cut out all of these emission generators, as well as making it faster, cheaper and easier to produce and store documentation.
• Compliance management: businesses need to know how well their processes are performing from an environmental perspective, but also how sustainability initiatives affect operational and financial performance, as well as compliance requirements.
  
  This can be particularly complex for transport and logistics companies with a large number of interconnected processes. However, an overarching service platform can make it far easier to gain a consolidated, unified view of processes, and enable environmental efforts to be placed into wider business contexts.

The benefits of sustainable IT for transport and logistics businesses

Greener, leaner IT can be beneficial for transport and logistics companies in a number of different ways, far beyond the headline savings in emissions. Businesses across the sector can also gain from:

• More efficient supply chains: automation of business processes can iron out the inefficiencies and human errors throughout the supply chain, making things run faster, smoother and more reliable.
• Improved compliance: digitisation of many processes, including documents that would normally be in hard copy format, makes it easier to complete an audit trail of information. This makes it far simpler to maintain compliance with various regulations, and to provide validation of this as and when required.
• Higher profit margins: faster, easier business processes can lower the cost of operations, generating the potential for a substantial boost to profitability without the need for major capital investment.

In summary

It wasn’t so long ago that making steps towards more sustainable operations was a ‘nice to have’, but it’s now a business essential that cannot be ignored. Of course, an ESG strategy needs to be balanced against compliance needs and profitability objectives, but this is an area where the help of technology and an expert partner can make things much easier, practical and cost-effective.

SCC’s comprehensive range of Document Services can play a vital role in making your business more sustainable, helping you drive forward with greener transport and logistics.

 To find out more or start your journey. Get in touch