Friday 15th Dec 2017 - Logistics Manager

Going green: who pays?

Apparently, going green is all very desirable – but only if someone else is paying for it. A survey conducted by Transport Intelligence and sponsored by IT supplier Kewill found that three quarters of companies awarding logistics contracts included sections on environmental compliance. But 54 per cent made no provision for the extra costs involved.

Of course, there are some things that cost nothing. Training drivers to be less heavy footed could be classed as a “green” initiative because it can result in a substantial cut in the amount of greenhouse gases produced. But, of course, it also reduces fuel consumption so it also saves money.

Nevertheless, many green initiatives will add to costs and so it is inevitable that this survey will raise questions about the commitment of some organisations to real environmental improvement. Are they serious – or is it just greenwashing? And, how far can third party logistics providers be expected to underwrite the exercise?

These are dangerous days: the green bandwagon is building up a huge amount of momentum, and consequently the pressure to be seen to be doing something is also growing. This can have all sorts of unfortunate consequences, such as ill-informed decision-making, reliance on questionable technologies, focusing on making a splash, failure to do the basics.

The bio-fuels issue is a salutary one – on the face of it this seemed to be an excellent option until it was found that rain forest was being grubbed out, as well as land being switched from food production, to make bio-fuels.

In the survey, 70 per cent of companies awarding contracts said that environmental compliance was either ‘reasonably important’ or ‘very important’. Survey respondents were also asked whether their companies’ environmental enthusiasm would change in the coming years, given the chances of an economic slowdown.

The overwhelming sentiment seemed to be no – but according to two-thirds of respondents, that is largely due to the “win-win” of implementing green initiatives which bring operational efficiencies and also cut costs. The number who said they would continue to pay more for an environmentally-friendly alternative (17 per cent) was balanced by the proportion who said they would base their sourcing decisions on cost alone.

Clearly, all aspects of environmental improvement are going to be revisited again and again over the coming years, but I suspect that the thorniest problem will continue to be: “who pays?”