The Greenwashing Charade: How to Look Eco-Friendly Without Actually Trying

Scrolling through LinkedIn these days, you’d think the corporate world is bustling with decarbonization and sustainability efforts. Let’s unbundle some of these typical PR posts first:

1. “2050 Zero-Emission” Goals: These are proudly announced everywhere. It’s safe to make such long-term promises—by then, we’ll all have retired. Remember the “50% emissions reduction by 2030” goals from a few years ago? Quietly gone. How often do we see updates on actual progress or plans for 2025?

2. “Go with the EV Flow”: Let’s start with one EV truck and have a nice photoshoot. Of course, the truck is purchased or leased by the vendor, not us, and we’ve offered them nothing in return. After all, it’s the carriers’ job to reduce emissions while delivering our products, isn’t it? This might reduce 0.0001% of our emissions in a given country, (maybe, we couldn't count) but doesn’t it look gorgeous?

3. Selling Carbon Offset Credits: It’s much easier to team up with a noble cause NGO preventing deforestation or helping people cook in Africa than to address our own emissions. Great PR for the unsuspecting, well-meaning public. Even better, let’s make some money on these credits.

4. Modeling (aka making up) Emissions Data: Okay, it’s the least attractive option but unavoidable—we need to report something. Most companies have no real data on their supply chain emissions, especially in emerging markets. Here, old trusty Excel comes in handy to simulate whatever we need.

Here's the thing though - these greenwashing activities will not suffice for long. Starting next year, the EU’s Corporate Sustainability Reporting Directive (CSRD) will require all European companies with a turnover of just EUR 40M to report all their emissions globally, including Scope 3 like outsourced logistics and transport. By 2028, this will also apply to any mid-size company selling into the EU market. We can expect other major economies to introduce similar regulations soon. See more on this here

Our questionnaire revealed that at least in the APAC region, awareness of these upcoming regulations among supply chain executives is abysmally low, while time to prepare is running out fast.

So it's worth to remind here what the GHG emissions classification is:

You can read more on this on websites of GHG and GLEC - Global Logistcs Emissions Council that deals specifically with supply chain framework.

Scope 3 emissions range from 50-70% of company total emissions in key consumer industries like FMCG, fashion, food & beverage, and transportation is the largest component of them, according to this World Economic Forum report.

Both size of emissions and imminent CSRD regulations should induce supply chain executives at both shippers and logistics providers to take more urgent and meaningful steps now on their 2050 zero-emissions journey.

From Greenwashing to Genuine Action: Practical Steps for Supply Chain Executives

f you are still reading this, you must be one of those idealists who genuinely wants to make a difference. Here’s what you need to know:

Start with GHG Emissions Accounting compliant with EU's CSRD and other similar regulations that will be rolled out progressively elesewhere.

Modeling vs. Accounting

First, understand the difference between emissions modeling and accounting. Modeling often relies on estimates and spreadsheets, while accounting involves capturing real data, adhering to standards, and undergoing audits. Accurate accounting is critical for meaningful action and compliance with regulations.

Steps to Take to Account for GHG Emissions & Establish The Baseline

1. Capture Emissions Data: Before making any investments in EVs or other technologies, ensure you understand your emissions. While live data capture with sensors may be unrealistic for most, CSRD guidelines provide minimum standards for data capture and reporting to avoid speculative XLS-based modeling. More on this here.
2. Follow Established Guidelines: Adhere to globally recognized standards like the GHG Protocol, GLEC framework, IPCC Guidelines, and ISO14083. These standards will help ensure your data is accurate and your efforts are aligned with best practices. More on this here
3. Implement Transport Management Software (TMS) or similar: Companies not using transport management software or real-time transport visibility, still relying on XLS & emails to communicate with carriers, lacking system integrations, cannot realistically implement Scope 3 transport emissions accounting and cannot effectively proceed to the next steps.

By focusing on real data and following these guidelines, you can reduce emissions and costs simultaneously.

Reduce Your Transport GHG Emissions

While using EV trucks can be beneficial, it’s not the first step most companies should take. Here are strategies ranked from most to least feasible:

1. Better transport planning & optimization: Better planning of loads and routes reduces both costs and GHG emissions. Mature TMS solutions focus on planning and optimization, offering different methods for various markets and scenarios. TMS providers like oTMS are adding GHG emission tracking capabilities, essential for accurate emissions accounting.
2. Reward Carriers for Less Polluting Trucks: Encourage carriers to use trucks certified to higher Euro emission standards, which significantly reduce pollutants. Implementing a system that converts CO2 reductions into financial incentives can help, though it requires robust verification systems and possibly regulatory support.

3. Increase Alternative Fuel Usage: While EVs are gaining traction for last mile in-city deliveries they be feasible for long-haul trucking. Alternative fuels that can be used in existing engines with minimal modifications offer a viable option. However, this should follow the implementation of optimization and carrier reward strategies, as it will incur higher costs initially.

In conclusion, individual companies and supply chain executives must start with supply chain and transportation digitalization in order to capture their existing GHG emissions baseline and start reporting and reducing them.

GHG emissions regulatory framework and IT developments like GenAI might eventually move a needle in the malaise of corporate supply chain departments to depart from their trusted excel spreadsheets.

Waiting for Government Regulations

Of course, another choice for many executives is just continue their green PR activities and do nothing real.

This is understandable, as despite the hype, in most companies supply chain departments are just cost centers and routine troubleshooters with no budgets, resources, skillset or authority to initiate such changes.

History shows that the most meaningful corporate sustainability steps often follow government regulations rather than corporate rhetoric. Key initiatives require short-term investments that cannot simply be passed on to suppliers, such as carriers. A prime example is the EU’s CSRD. As public and political focus on decarbonization grows, we can expect:

? Carbon Pricing and Subsidies: Increasing taxes on diesel and subsidizing alternative fuels. This reflects the true cost of GHG emissions in products or services, an approach that likely won’t happen without regulatory mandates.

? Municipal Logistics Strategies: Beyond EV-only zones, cities might enforce mandatory consolidation zones for B2B and B2C deliveries to reduce GHG emissions and congestion, especially as online ordering rises.

? Enhanced Energy Efficiency Standards: Pushing for lower internal combustion engine (ICE) emission standards achievable with alternative fuels and improving EV efficiency, which currently often consumes too much energy compared to ICEs. Both well-to-wheel (W2W) and tank-to-wheel (T2W) standards need consideration.

? Mandatory Nearshoring: Promoting local production for basic items, as the globalization of supply chains plateaued during COVID-19. This shift addresses the inefficiencies of excessively global supply chains for basic commodities.

Government regulations play a crucial role in driving meaningful corporate actions towards sustainability, ensuring that the necessary investments and systemic changes are made.

Will The Real Supply Chain Heros Please Stand Up?

Now is the time for genuine supply chain innovators and leaders to take meaningful action. Regulators and the public are anyway already forcing your leadership hands. Showing initiative that can reduce GHG, operation costs and finally digitalize legacy processes will help your careers, no matter in your current or future companies

Embrace sustainable practices, invest in real data, and lead the charge in reducing emissions. The future of our planet depends on proactive, committed leaders like you.