While digitalization is revolutionizing today’s business landscape, another transformation is also underway – one that strikes at the very heart of the way we do business: a movement toward fair and responsible business practices. The logistics industry can play a key role in driving this transformation and contributing to a sustainable future for all.
If you were given a choice, wouldn’t you prefer to purchase products with a ‘fair and responsible business’ label? A guarantee that fairness and sustainability was high priority at every link product’s entire value chain, from materials sourcing and manufacturing to storage and transportation?
I would. And all indications are that I’m not alone. People are demanding more transparency and fairness from business – and they are interested in consuming fair and responsible products.
We are, in fact, seeing a transformation. And it’s being driven by a unique fusion of social, mobile, cloud and big data trends that are connecting societies around the world and enabling companies to achieve more transparency and access to their supply chains. A growing awareness that mother earth is truly in trouble and increasing environmental and compliance standards are also contributing.
Profits and sustainability go hand in hand
‘Going fair’ is the next evolutionary phenomenon that will impact the way we do business. It is a new approach that places fairness and responsibility at the heart of the business model to ensure that profits and sustainability work hand in hand.
We all know that business has always been about creating value. In past decades, many companies have pursued a somewhat narrow definition of value. Under pressure from international competition and financial markets, they have focused on the bottom line and efficiency measures designed to maximize short-term profits. However, it is becoming increasingly clear that this approach is losing its edge. Efficiency has been stretched to such an extent in many industries that further growth potential is marginal, and public attention is increasingly drawn to the negative (long-term) consequences of this approach.
Most companies, however, are not ignoring these demands. Many have established large corporate social responsibility (CSR) programs. These initiatives are having a positive impact on society and the environment and help to ensure compliance, reduce the detrimental effects of business operations on society and the environment, and stimulate charitable activities. Today, CSR programs have become the norm around the globe. In fact, more than 90% of the world’s largest companies publish CSR reports to demonstrate their commitment and contributions.
Logistics can lead the way
So how does the logistics industry fit into all this? First, it’s an industry that is at the nexus of global challenges. On the one hand, logistics requires intensive investment of resources, capital, assets, and labor and therefore has considerable impact on society and the environment. On the other hand, efficient logistics is vital to world trade and forms the backbone of many industries. It improves transparency across the entire supply chain and can connect the smallest to largest of markets, creating awareness for social and environmental challenges as well as opportunities.
Logistics is a network business with a global reach that can play a key role in helping businesses ‘go fair’ as well as in improving overall transparency in the entire supply chain. Fair and responsible logistics can generate new revenue streams as well as social and environmental value for all stakeholders.
And logistics companies like DHL are already doing it. Sustainable solutions are an essential part of our product portfolio. We call them GoGreen Solutions. And we have a dedicated shared value team that is leading the way as we continuously develop and deploy new green products and services.
Fair and Responsible Business trend report
We’ve issued a new study on fair and responsible logistics as part of our on-going deep dive into the topic. In it we identify fifteen potential use cases for fair and responsible logistics, ranging from the circular economy to creating fair access and enabling fair production and trade. We plan to use these cases to develop proofs of concept to drive this new responsibility transformation.
In a nutshell, we are looking for ways to further accelerate our fair and responsible business practices.
One of the key actions we identified in the report is that the logistics industry must leverage its interconnectedness, assets and overview of supply chains, to become a guarantor for the circular economy and to create fair access, production and trade.
We also sketch how logistics providers could play a crucial role in furthering a circular economy by implementing innovative reverse logistics solutions such as recycling friendly hubs and trucks that act as both logistics and recycling infrastructure. It also illustrates how transportation and last-mile delivery could be transformed by offering discount deliveries to the underprivileged in order to enable fair access to basic logistics services.
You’ll also find ideas for fair and responsible packaging solutions, such as utilizing bio-degradable or other eco-friendly materials. One innovative use case is to completely eliminate the need for packaging for online deliveries by adopting a zero-waste approach. Moreover, the implementation of fair and responsible business practices could encourage the complete mapping of supply chains to identify responsibility risks and conduct regular spot checking. This would confirm that all logistics services are being conducted in a fair and responsible manner.
In today’s climate, ensuring a sustainable future is proving more challenging than ever before. Yet the move toward fair and responsible business is underway, and it’s time for the logistics industry to be a driver of that transformation.