Collaboration: the key to sustainable logistics and the urbanization challenge

Sustainability initiatives are good for business, the long-term health of urban citizens, and the environment, but it will take long-term thinking and engaged problem-solving strategies. (Shutterstock)

Sustainability initiatives are good for business, the long-term health of urban citizens, and the environment, but it will take long-term thinking and engaged problem-solving strategies. (Shutterstock)

UPS and Greenbiz Group recently released a report on business growth and sustainability. Nearly all the companies surveyed are concerned with urban logistics, but less than half feel prepared to address the challenge. The study presents the findings of qualitative research, among a sample of 612 respondents. It reveals that 95 percent of companies surveyed are aware of the impacts—primarily air quality and traffic congestion—urbanization will have on business growth and sustainability.

A majority of survey respondents (72 percent) believe that businesses need to work closely with city officials to identify and address these urban environmental and social challenges. The report confirms other recent policy collaborations on the importance of business and cities working together.

The real difference-maker

“Increased urbanization and congestion make logistics far less predictable and harder to manage,” says Mark Wallace, UPS senior vice president, global engineering and sustainability. “Without implementing innovative solutions supported by technology and logistics ingenuity, we run the risk of increasing congestion and emissions. We need solutions, and collaboration is the key.”

The real difference-maker isn’t going to be any one piece of technology. It’s the commitment to partner with cities, academics, and other business leaders to develop solutions that work for the good of everyone.

The majority of those surveyed believe businesses play a critical role in activating and adopting innovative approaches to creating more sustainable environments. Most want to work closely with city officials to make it happen.

That’s exactly what Sustainable Urban Logistics Plans (SULP) guidelines laid out in 2015 in anticipation of meeting a series of 2020 goals throughout Europe. The European Union partnered with the Civitas Initiative anticipating massive urban growth challenged with aging infrastructure.

Congestion and pollution

Logistics is one part of the equation businesses and cities are challenged to strategize. The increase in urbanization brings with it a number of challenges. By far, though, the biggest challenges from an infrastructure and quality of life standpoint can be summarized in two words: congestion and pollution.

To address increasing congestion, many cities have committed to more sustainable mobility options, such as biking, by providing bike lanes. While beneficial for encouraging commute options, these efforts alone will only help reduce congestion if the number of personal vehicles on the streets is reduced. Urban congestion is essentially a problem of competing priorities, and requires collaboration to create solutions.

The rise of e-commerce

As logistics operations become more complex, costly and difficult to control, more conflicts will arise. Meanwhile, customers demand faster, more reliable and more flexible delivery options. The rise in e-commerce transactions is creating an increase in the volume of packages to be delivered which, if not supported by sustainable logistics practices, could result in even more vehicles on the road and an increase in congestion and emissions.

Many forward-looking businesses already embrace the shift away from coal and other fossil fuels. The RE100, a partnership between The Climate Group and CDP, is yet another collaborative global initiative uniting more than 116 influential businesses committed to 100 percent renewable electricity.

Good for the environment = good for business

Companies such as Apple, BMW, BT, Coca-Cola, General Motors, Microsoft Corporation, Google and Unilever have committed to going 100 percent renewable, and it’s proving to be good business. These companies are part of a group that outperformed companies in the Bloomberg World Index by 9.6 percent and the Dow Jones Sustainability World Index by 19.6 percent, according to CDP data

 “There is a palpable sea change in approach by companies driven by a growing recognition that there is a cost associated with the carbon they emit. Measurement, transparency and accountability drives positive change in the world of business and investment,” says Paul Simpson, CEO of CDP.

Leading businesses are also more committed to finding a global solution, engaging with policymakers on climate change far more than the others—78 percent compared to 49 percent. CDP’s report is just the latest in a series of high-profile research that underlines the clear benefits for businesses investing in low carbon efficiencies.

The Global Commission on the Economy and Climate released yet another climate change and economic report. The Commission’s report Better Growth, Better Climate: The New Climate Economy reveals 50-90 percent of the actions required to cut emissions in most countries will also drive economic growth. “We must not choose between fighting climate change or growing the world’s economy,” said the former President of Mexico Felipe Calderón, chair of the commission.

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