Towards Green Logistics Practice

Environmental protection is one of the major concerns of this decade. Goods shipment is estimated to account for about eight per cent of energy-related carbon dioxide emissions globally. Warehousing and freight related emissions add another three per cent. In view of this, there has been a significant pressure on firms to take steps towards reducing environmental impact due to their logistics operations. Sustainable logistics require reducing carbon emissions drastically. Both logistics costs and environmental impact can be reduced significantly through green supply chain practices. Besides complying with environmental regulations, firms can benefit from financial gains. It is a win-win situation for both environment and industries.

Shifting to more efficient freight transportation modes is expected to reduce CO₂ emissions by at least forty per cent according to one of the IEA publications.  Studies have shown that, supply chain network optimization can result in cost cutting by eleven percent and a ten percent reduction in CO₂ emission. Green packaging practices like packaging elimination, light-weighting and use of alternative or recyclable material help companies to have an overall cost reduction. Estimates say that, atleast 50 % of power can be conserved in warehouses through daylight dimming and use of motion sensors.  Purchase departments can also save significant cost through sustainable initiatives.  Above all, firms can improve their public image.  

Corporate policies should now aim at reducing their impact on environment and gain from sustainable practices.  According to New 'Green Transportation & Logistics' report, 94% of supply chain professionals rate green issues as a business priority. Industries like CPG, Food & Beverages, Heavy Engineering, Automobile, Pharma, etc., should motivate and empower their logistics & supply chain professionals towards green logistics initiatives.  Executives involved in product development, purchase and logistics management should understand: (1) Ways to measure the impact of their transportation and logistics on the environment (Environmental Footprint Measurement) and how corporate can gain from footprint reduction; (2) How to develop an action blueprint for each mode and their vertical, to reduce environmental footprint; (3) Best practices like sustainable procurement, network optimization, green packaging, layout optimization, etc., and (4) Corporate Sustainability Reporting, and benchmarking with the industry.