Green Logistics

Improving the Environmental Sustainability of Logistics

Alan McKinnon, Michael Browne, Anthony Whiteing, Maja Piecyk, Alan McKinnon, Michael Browne, Anthony Whiteing, Maja Piecyk

• Publisher: Kogan Page
• Year: 2015
• ISBN:
  9780749471866
• Edition: 3
• Topic: Business
• Subtopic: Supply Chain Management
• Index: Business

Leading the way in current thinking on environmental logistics, Green Logistics provides a unique insight on the environmental impacts of logistics and the actions that companies and governments can take to deal with them. It is written by leading researchers in the field and provides a comprehensive view of the subject for students, managers and policy-makers. Fully updated, the 3rd edition of Green Logistics has a more global perspective than previous editions. It introduces new contributors and international case studies that illustrate the impact of green logistics in practice. There is a new chapter on the links between green logistics and corporate social responsibility and a series of postscripts examining the effects of new developments, such as 3D printing, distribution by drone, the physical internet and the concept of peak freight.Other key topics examined include: carbon auditing of supply chains; transferring freight to greener transport modes; reducing the environmental impact of warehousing; improving the energy efficiency of freight transport; making city logistics more environmentally sustainable; reverse logistics for the management of waste; role of government in promoting sustainable logistics.The 3rd edition of Green Logistics includes indispensable online supporting materials, including graphics, tables, chapter summaries, and guidelines for lecturers.

Part One

Assessing the environmental effects of logistics

01

Environmental sustainability

A new priority for logistics managers

ALAN McKINNON

Introduction

Logistics is the term widely used to describe the transport, storage and handling of products as they move from raw material source, through the production system to their final point of sale or consumption. Although its core activities have been fundamental to economic development and social well-being for millennia, it is only over the past 50 years that logistics has come to be regarded as a key determinant of business performance, a profession and a major field of academic study. During this period the dominant paradigm for those managing and studying logistics has been commercial. The prime, and in many cases sole, objective has been to organize logistics in a way that maximizes profitability. The calculation of profitability, however, has included only the economic costs that companies directly incur. The wider environmental and social costs, traditionally excluded from the balance sheet, have been largely ignored – until recently.

Over the past 10–15 years, against a background of increasing public and government concern for the environment, companies have come under mounting pressure to reduce the environmental impact of their logistics operations. This impact is diverse, in terms of the range of externalities and the distances over which their adverse effects are experienced. The distribution of goods impairs local air quality, generates noise and vibration, causes accidents and makes a significant contribution to global warming. The impact of logistics on climate change has attracted increasing attention in recent years, partly because tightening controls on pollution and road safety improvements have alleviated the other environmental problems, but also because new scientific research has revealed that global warming presents a much greater and more immediate threat than previously thought.

The Intergovernmental Panel on Climate Change (IPCC, 2014) estimates that in 2010 the movement of freight accounted for roughly 43 per cent of all the energy used in transport and around 12 per cent of total global energy consumption. This corresponds to a share of approximately 10 per cent of energy-related CO₂ emissions worldwide. The inclusion of warehousing and materials handling is likely to add around 2–3 per cent to this total. The World Economic Forum and Accenture (2009) have estimated that logistical activity accounts for roughly 5.5 per cent of total global greenhouse gas (GHG) emissions (including all the other GHGs, such as methane and nitrous oxide, and not simply CO₂). They suggest that ‘logistics buildings’ emit 9–10 per cent of the total, with the rest coming from freight transport. Trucks and vans are responsible for two-thirds of these transport GHG emissions. Eom et al (2012) have also shown how, at a national level, freight-related carbon emissions per capita increase more or less in line with income per capita (at constant prices). Emissions from international transport are also rising steeply as trade volumes expand and globalization criss-crosses the planet with complex ‘value chains’ (McKinnon, 2014). It has been estimated by the UK Committee on Climate Change (2008: 306) that in the case of shipping ‘unconstrained growth could result in global CO₂ emissions growing two to three times current levels by 2050… At this level they would, in 2050, account for 15–30 per cent of all CO₂ emissions permitted under our preferred global emission reduction scenarios’. In the light of these calculations and trends, it is hardly surprising that governments and intergovernmental organizations are developing carbon abatement policies for the freight transport sector.

Making logistics ‘sustainable’ in the longer term will involve more than cutting carbon emissions. Despite recent improvements, the potential still exists to cut the other environmental costs of logistics by a significant margin. Furthermore, sustainability does not only have an environmental dimension. Sustainable development was originally portrayed as the reconciliation of environmental, economic and social objectives (Brundtland Commission, 1987). The expressions ‘triple bottom line’ and ‘people, profit, planet’ are often used in the business world to convey this notion of a three-way trade-off. The concept also underpins government strategies on sustainable distribution, such as that of the UK government (Department for Transport, 2008). In practice, however, many of the measures that reduce the environmental impact of logistics, the so-called ‘green-gold’ measures, also save money, avoiding the need to trade off economic costs against environmental benefits. While the main focus of this book is on ways of reducing the environmental effects of logistics, frequent reference is also made to their economic and social implications.

For the purposes of this book, we define ‘green logistics’ as the study of the environmental effects of all the activities involved in the transport, storage and handling of physical products as they move through supply chains in both forward and reverse directions. It assesses the nature and scale of these effects and examines the various ways in which they can be reduced.

The issues discussed in the book are topical, important and currently engaging the attention of company managers and public policy makers in many countries around the world. They are examined from both corporate and public policy perspectives. The book aims to provide a broad overview of technical, managerial, economic and policy aspects of green logistics. It contains case studies and examples of the types of initiatives that can be taken at different levels, ranging from those within a single company to those that span an entire supply chain and possibly involve businesses in several countries. The book also explores the range of approaches and analytical tools available to academics and practitioners working in the field of green logistics.

Green logistics is a relatively young but rapidly evolving subject. In the four years since the first edition of this book was published a substantial body of new research has been undertaken on the subject, examples of companies ‘greening’ their logistics have multiplied and many governments have been intensifying their efforts to reduce the environmental damage done by freight movement.

The remainder of this chapter lays a foundation for the book by reviewing the development of the subject over the past six decades. It also presents an analytical framework for the study of green logistics and concludes with a brief outline of the other 17 chapters.

A brief history of green logistics research

It is difficult to decide when research on green logistics began. One possible starting point would be the publication of the first paper on an environmental theme in a mainstream logistics or transport journal. This, however, would ignore a large body of earlier research on the environmental effects of freight transport undertaken before logistics gained recognition as a field of academic study. While concern was expressed about the damaging effects of freight transport in the 1950s, most of the substantive research on the subject dates from the mid-1960s. Murphy and Poist (1995: 16) assert that: ‘prior to the 1960s, there was relatively little concern regarding environmental degradation. For the most part, the environment’s ability to absorb wastes and to replace resources was perceived as being infinite’. This review is therefore confined to the past 50 years, but it ‘casts its net wide’ to capture a broad assortment of relevant literature in journals, books and reports. In their review of 10 logistics, supply management and transport journals over the period 1995–2004, Aronsson and Huge-Brodin (2006) found that only 45 papers out of 2,026 (2.2 per cent) addressed environmental issu...