Stakeholder pressure from investors, executives, government, regulatory bodies and even consumers to reduce Greenhouse Gas (GHG) emissions continues to rise. As climate events increase in frequency and severity, environmental concerns are top of mind for all stakeholders.
Last year 2017 and 2011 tied for the third highest number of billion-dollar disasters. 2022 was also third highest in total costs (behind 2017 and 2005), with a price tag of at least $165.0 billion – and that’s just in the US. The costliest 2022 events were Hurricane Ian ($112.9 billion) and the Western and Central Drought / Heat Wave ($22.1 billion).
Adding the 2022 events to the record that began in 1980, the US has sustained 341 weather and climate disasters with the overall damage costs reaching or exceeding $1 billion. The cumulative cost for these 341 events exceeds $2.475 trillion.
And things will not get better. The United Nations is forecasting an increase of disasters around the world to 560 disasters a year – or 1.5 every day.
2023 will also bring more and different sustainability considerations. There will more changes to regulatory requirements with scrutiny on sustainability reporting. IMO2023 (Oceanside) will mean older ships must slow down to reduce emissions with a knock-on effect for capacity as ships will have to reduce the number of trips. Capacity issues will impact rates as demand remains strong. Supply chain operators and their customers will have to build this consideration into their budgeting. The European commission’s mandate on sustainability reporting has companies scrambling to access emissions data.
As sustainability becomes top of mind for all stakeholders, we also see more “greenwashing.” Environmentalist Jay Westerveld coined the term “greenwashing” in 1986, in a critical essay inspired by the irony of the “save the towel” movement in hotels that had little impact beyond saving hotels money in laundry costs.
Greenwashing is when an organization spends more time and money on marketing itself as environmentally friendly than on actually minimizing its environmental impact. It’s a deceitful marketing gimmick intended to mislead consumers who prefer to buy goods and services from environmentally conscious brands.
Despite new regulations and worsening climate threats, the reality is that not that much is happening when it comes to scope 3 emissions. Businesses still struggle to begin their carbon reduction journey, given the perceived complexity as well as competing business priorities. Most companies might have an ESG program, but no budget to actively spend on scope 3 emissions reduction. These same companies struggle to collect, manage, and compare data on carbon emissions, especially those generated by assets they do not control i.e., scope 3 emissions.
Investors are shifting to ESG-related investments and at the same time consumers are shifting their purchasing behaviors to buy more environmentally friendly products. As mentioned earlier, regulators in leading economies are introducing carbon disclosure requirements in 2023. And now, for the first time, Environmental Sustainability reached the list of top ten strategic concerns of CEOs. These factors combine to create the perfect conditions for logistics sustainability to make its breakthrough in 2023.
To accurately measure and reduce your supply chain emissions you need three things:
- Emissions data that is accessible and accurate
- Visibility and automated reporting of your global transportation emissions
- Workflow solutions to enable emissions-based decision making
This is where project44’s Ocean Sustainability Digital Twin comes in. We’re applying the same technology and approach that has made project44 the number one provider in transportation visibility, workflow and data insights to give you the tools you need to measure and reduce your supply chain emissions. Our robust data sourced from the world’s largest carrier network and other proprietary sources, combined with your shipment data and run through the most advanced emission calculators, powers the visibility and workflow tools you need to measure and reduce emissions. We give you visibility into historical, current, and forecasted CO2 emissions by location, lane, and carrier with shipment-level granularity. We deliver emission-based workflow solutions, like emissions-based tendering, to help you actively reduce your emissions.
So, if you have not started executing on measuring scope 3 emissions, now is the time. Identify your largest mode of transportation that holds the highest GHG emissions footprint and start using sustainability solutions as a first step to measuring your company’s scope 3 footprint.