Sustainability reporting in the global logistics industry
Sustainability reporting helps in providing meaningful information about environmental, economic, governance and social performance of a business organisation. This type of reporting is significant for almost all types of business organisations operating in the global industrial sectors (Amran, Lee and Devi 2014). The current report would focus on two aspects of sustainability reporting that include environmental performance and social performance of the three selected organisations, which are FedEx, Schneider Logistics and DHL Supply Chain. These organisations operate in the global logistics industry in different nations of the world. Therefore, this report would shed light on the environmental as well as social disclosures made by these organisations in their latest annual reports in 2017 and then they would be compared with each other to find out the similarities and differences in their sustainability disclosures.
Sustainability reports are published on the part of three stated organisations due to the following purposes:
FedEx:
FedEx is an US multinational courier delivery service organisation that provides crucial information to the internal as well as external stakeholders about the different sustainability actions with the help of sustainability reporting. Moreover, it aims to assure the success of its customers, which are present in the global markets. The management of FedEx sees sustainability reporting as a major factor, which enables in creating long-term values for internal as well as external stakeholders. Finally, it follows General Reporting Initiative (GRI) for creating values related to safety, trust, respect, excellence and reliability (Investors.fedex.com 2018).
DHL Supply Chain:
DHL Supply Chain is a German supply chain management and third party logistics service provider, which provides reports on GRI with the goal of achieving effective standards in areas related to safety, environmental management, efficacy, safety and governance. More precisely, DHL Supply Chain publishes sustainability report for providing positive societal as well as environmental outcome. Hence, it intends to take into account the different issues of business sustainability related to four important sectors. These issues take into account accountable business activities, economic development coupled with secured and safe workplace (Annualreport2017.dpdhl.com 2018).
Schneider Logistics:
Schneider Logistics is a provider of intermodal, truckload and logistics services in US, which functions as a responsible citizen by focusing on fuel efficiency, energy conservation and freight consolidation. The sustainable business operations have allowed the organisation to carry out better work with minimised emissions. Moreover, it has active involvement in community outreach at the time of the Schneider Foundation back in 1982 by sponsoring programs for strengthening well-being, community health and positive change (Investors.schneider.com 2018).
Environmental and social disclosures of FedEx, Schneider Logistics, and DHL Supply Chain
FedEx:
In terms of social responsibility, FedEx invests in programs in order to ensure the welfare of the global communities by providing financial assistance, in-kind charitable shipping as well as volunteerism. It has committed to invest nearly $200 million in 200 global communities by the end of 2020. The global reach and unmatched logistics skills have allowed the organisation to provide necessary resources at times of need (Cho et al. 2015). In 2016, the organisation has donated above $5.67 million in terms of cash and in-kind support to humanitarian organisations. Moreover, assistance has been provided in relief efforts for 15 disasters including support for the European migrant crisis along with earthquakes in Ecuador and Japan and wildfires in Canada (Barkemeyer, Preuss and Lee 2015).
In terms of environmental reporting, FedEx has made adequate disclosures regarding direct as well as indirect consumption of energy in terajoules, direct as well as indirect greenhouse gas emissions in CO2e metric tons, intensity of emissions and other important pollutants in air in metric tons. In order to minimise the usage of fuel cost and related greenhouse gas emissions, efficiencies have been implemented by introducing FedEx Fuel Sense Program along with replacing many old airplanes with higher fuel-efficient models. Such initiatives have helped the organisation in saving above 153 million jet fuel gallons and 1.5 million metric tons of CO2e emissions. Moreover, it has optimised its truck routes, encouraged good habits of driving, upgraded vehicle fleet to effective models while finding alternative technologies and fuels (Ehnert et al. 2016). Finally, adequate disclosures regarding conformance to GRI could be found from the annual report of the organisation.
DHL Supply Chain:
In terms of social reporting, the organisation has developed a team of disaster management for the international community by introduction of its Group Program, GoHelp. Moreover, it provides educational support for the weaker and economically backward classes of the international community and thus, equal opportunities are offered in terms of employment (Fonseca, McAllister and Fitzpatrick 2014). This is mainly conducted by collaborating with the international Teach For All network that recruits as well as trains graduate students with the help of its independent partner organisations at the national level. Finally, it helps in aiding the refugees and charitable organisations by assisting them in their local projects.
In terms of environmental reporting, the organisation has concentrated on modernising its air fleet so as to keep in line with the changes in sustainability reporting expected to occur in the future years. Moreover, with the increase in technical modifications as standard procedure in European Union, the organisation has decided not to report such developments in detail (Junior, Best and Cotter 2014). In 2017, DHL has initiated minimum standards for its heavy trucks like speed limiting devices, automatic transmissions and anti-idling systems for increase in carbon efficiency. Moreover, adequate disclosures are made in terms of lighting systems, air pollution, clean delivery solutions and E-mobility, which is about to become necessary in the industry in future.
Comparative analysis of sustainability disclosures
Schneider Logistics:
In terms of social reporting, Schneider Logistics has active involvement in community outreach at the time of the Schneider Foundation back in 1982 by sponsoring programs for strengthening well-being, community health and positive change. Support has been extended to the armed forces, as 25% of the company associates have military background.
In terms of environmental reporting, focus has been kept always on fuel efficiency, energy conservation and freight consolidation. Moreover, it has managed to reduce waste by using 12,000 batteries yearly, 160,000 oil gallons yearly and 93,000 retreaded tire casings with the help of smarter recycling. However, not adequate disclosures regarding its environmental reporting could be found from its annual report.
Similarities:
- All the organisations have been extending support to the social community by developing sustainable business practices and financial assistance.
- The organisations have concentrated on waste minimisation through energy efficient techniques for maintaining environmental sustainability.
- Freight consolidation has been provided with adequate importance by all the three organisations.
Differences:
- Both FedeX and DHL have disclosed their social and environmental disclosures by complying with GRI, while Schneider has not adopted this initiative yet, since it is not mandatory under US GAAP (Kozlowski, Searcy and Bardecki 2015).
- In case of FedEx, the impact of all the materials and technologies have been represented in tabular format supported by relevant notes, while DHL has not represented in tabular form; instead, they are written in separate sections. No such disclosures could be found in case of Schneider Logistics.
- Both FedEx and DHL have extended financial help, education programs and donations to the economically backward classes and disaster victims, while Schneider has concentrated on providing employment to the retired individuals of the armed forces.
Conclusion:
From the above discussion, it is inherent that sustainability reporting is becoming crucial for all types of business organisation irrespective of their size, nature and location. However, it could be observed that both FedEx and DHL have conformed to the regulatory requirements by making adequate disclosures, while Schneider needs to improve its reporting practices by keeping in mind the future reporting changes.
References:
Amran, A., Lee, S.P. and Devi, S.S., 2014. The influence of governance structure and strategic corporate social responsibility toward sustainability reporting quality. Business Strategy and the Environment, 23(4), pp.217-235.
Annualreport2017.dpdhl.com., 2018. [online] Available at: https://annualreport2017.dpdhl.com/downloads-ext/en/documents/DPDHL_2017_Annual_Report.pdf [Accessed 3 Aug. 2018].
Barkemeyer, R., Preuss, L. and Lee, L., 2015. On the effectiveness of private transnational governance regimes—Evaluating corporate sustainability reporting according to the Global Reporting Initiative. Journal of World Business, 50(2), pp.312-325.
Cho, C.H., Laine, M., Roberts, R.W. and Rodrigue, M., 2015. Organized hypocrisy, organizational façades, and sustainability reporting. Accounting, Organizations and Society, 40, pp.78-94.
Ehnert, I., Parsa, S., Roper, I., Wagner, M. and Muller-Camen, M., 2016. Reporting on sustainability and HRM: A comparative study of sustainability reporting practices by the world’s largest companies. The International Journal of Human Resource Management, 27(1), pp.88-108.
Fonseca, A., McAllister, M.L. and Fitzpatrick, P., 2014. Sustainability reporting among mining corporations: a constructive critique of the GRI approach. Journal of Cleaner Production, 84, pp.70-83.
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Investors.fedex.com., 2018. FedEx – FedEx – Annual Reports . [online] Available at: https://investors.fedex.com/financial-information/annual-reports/default.aspx [Accessed 3 Aug. 2018].
Investors.schneider.com., 2018. Schneider National Inc. – Investors – Financials . [online] Available at: https://investors.schneider.com/investors/financials/default.aspx [Accessed 3 Aug. 2018].
Junior, R.M., Best, P.J. and Cotter, J., 2014. Sustainability reporting and assurance: A historical analysis on a world-wide phenomenon. Journal of Business Ethics, 120(1), pp.1-11.
Kozlowski, A., Searcy, C. and Bardecki, M., 2015. Corporate sustainability reporting in the apparel industry: An analysis of indicators disclosed. International Journal of Productivity and Performance Management, 64(3), pp.377-397.
Lozano, R., Nummert, B. and Ceulemans, K., 2016. Elucidating the relationship between sustainability reporting and organisational change management for sustainability. Journal of cleaner production, 125, pp.168-188
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