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How Sustainable Practices Can Bolster the Global Economy

Sustainable
Archives, Global Trade Daily, International Trade

How Sustainable Practices Can Bolster the Global Economy

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Consumer demand for sustainable products is at an all-time high, likely due to a growing understanding of how consumption and energy use can impact the environment. In response, businesses are prioritizing sustainable practices and committing to goals to reduce consumption of resources, production of carbon emissions and generation of waste products.

While discussions of sustainability often center on the cost of sustainable practices, they could also be a major driver of growth for markets around the world. This is how eco-friendly practices could bolster the global economy as sustainability becomes a top business priority over the next few years.

Low-Waste Manufacturing and Safeguarding Raw Materials

Often, a key benefit of new sustainable technologies is their ability to reduce waste. They help manufacturers do more with less, reduce costs and ensure the availability of resources in the future.

For example, additive technologies, like 3D printing, are generating interest partly because they produce very little waste compared to conventional manufacturing. The process of adding material to a base via printing, rather than cutting it away to create the desired shape, makes it easier to minimize the by-product a project generates.

The growing availability of sustainable printing materials, like wood and metal, means manufacturers can also use 3D printing to mass-produce items with minimal waste.

These goods can also be more sustainable than those produced traditionally.

Some research has also found that 3D printing can use less energy than conventional manufacturing techniques, further reducing the environmental footprint. By reducing waste and resource consumption, sustainability may help manufacturers reduce costs and secure a competitive advantage.

Other manufacturing approaches look to recapture existing waste or find ways to turn it into resources other businesses may overlook. Reclaimed and recycled materials are an increasingly popular method for making manufacturing processes more sustainable.

Even as raw materials become more expensive, businesses can keep costs low by finding ways to take advantage of used materials that were set to go to landfills.

Practices that conserve limited raw materials in the first place can also safeguard future profits. Sustainable aquaculture can help fishermen limit resource consumption while avoiding overharvesting, which can result in smaller hauls and lower available revenue in the future. Sustainable lobster fishing uses techniques like v-notching — the marking of female lobsters with eggs — and trap size limits to preserve a population large enough to meet current and future demand.

In most industries, the availability of future resources will be dependent on current resource use to one extent or another. Sustainable resource generation and low-waste manufacturing are essential for businesses wanting to secure future growth.

 

Creating New Markets With Innovative Sustainable Products

Some products also create new opportunities for consumers. Many of these sustainable items are driving significant growth and reinvigorating markets that have been struggling over the past few years.

One of the best examples of these products is the e-bike, a transportation option often recommended to people wanting to reduce their carbon footprint. Unlike electric vehicles, which are typically thought of as a sustainable alternative to conventional cars, e-bikes create a sustainable transportation option that fills a formerly neglected demand niche.

These bikes are outfitted with a small electric motor and battery. They offer improved mobility and range over a standard bicycle, without the high speed or mechanical complexity of a vehicle like a moped or motorcycle.

In areas where environmental factors make bike travel impractical — like steep hills or long distances between important locations — e-bikes may still function as an effective means of travel. Also, because they can be plugged into any standard outlet, users in areas without EV infrastructure can adopt the bikes without worrying about running out of charge.

There is significant evidence that demand for e-bikes is one of the primary drivers behind the growth in bicycling right now. As imports of pedal-only bikes tanked in 2019 and 2020, there was an explosive increase in e-bike demand. Estimates of the market growth often have it on track to grow noticeably faster than the bike market in the near future, and some observers predict these bikes will eclipse standard options in the next few years.

For people living in or returning to cities and other population-dense areas, transportation options like e-bikes are likely to become much more popular. While bikes aren’t always an effective transportation option, e-bikes may mean consumers won’t have to turn to gas-powered methods — like public transit, conventional cars or mopeds — to get around.

Reducing Resource Consumption

The ongoing pivot to sustainable practices is also changing how and where businesses operate. One of the most significant changes has been in how buildings are designed, built and operated. Companies and architectural firms are starting to take advantage of innovative design techniques and new smart technology to reduce the resources needed to keep new buildings operational.

For example, whole-building design techniques change how structures are organized to save money or reduce energy consumption. Clever window placement can significantly increase the amount of natural lighting an office receives. This can make a building more pleasant for its occupants and reduce electricity costs.

Smart lighting systems, which can automatically adjust artificial sources based on the time of day and how much natural light a room is receiving, can optimize things even further.

Similar design strategies can help businesses cut down water usage or optimize an HVAC system. According to some industry experts, the use of high-performance HVAC equipment can result in cost cuts, emissions reductions and energy savings of up to 40% or more.

Whole-building design techniques can offer greater savings while also reducing the amount of work HVAC systems need to perform to keep a building comfortable. This can reduce the wear and tear in normal operations, meaning components may not have to be replaced or repaired as often.

Sustainability Is Driving Growth Around the World

In the near future, sustainable practices will be key drivers of business growth.

The more mindful use of resources will help ensure businesses minimize waste and keep raw materials available well into the future. New building design strategies will make offices and factories more comfortable and efficient, reducing resource consumption while boosting productivity.

Sustainable business strategies may also meet customer demands that were previously being ignored, such as the use of e-bikes. All these practices will help drive the economy to new heights and help the planet at the same time, something that benefits everyone.

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Archives, Global Logistics, Global Trade Daily

Plant-Based vs. Synthetic Ingredients in Consumer Products: Why You Should Add Hemp to Your Ingredient List

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For the past 50 years or so, industries across the globe have rushed to synthesize everything as a matter of convenience. Synthetics allow manufactures to mass-produce products to meet rising consumer demand, which exploded after World War II. But as the 20th century ended, consumers began to question the wisdom of that choice and grew concerned about the potential health and environmental impacts of synthetics.

Today, consumer trends show a desire to return to natural products, to connect with the planet, and to buy and use items that contain ingredients people can understand. Manufacturers around the globe have started to take notice, and they have rushed to ditch synthetics and catch up with the plant-based revolution.

Are Cannabinoids the Missing Secret Ingredient?

The problems for companies trying to meet consumers’ demands for natural products are often complex. For example, it’s a challenge to find effective plant-based alternatives to many of the synthetic ingredients in products. However, one potentially overlooked natural ingredient is on the rise — hemp.

For the past 50 years, the growth and use of the cannabis plant in all its forms has been illegal in the United States and many other countries. The legality of the plant is the key reason it has never been integrated into many consumer products.

In the time since the Hemp Farming Act of 2018 passed and legalized the cultivation, study, and use of hemp in the U.S., we’ve learned a lot about the potential applications of the different cannabinoids (i.e., compounds) present in the hemp plant. Because hemp has so many compounds, it has diverse potential applications. For example, some of the phytochemicals naturally present in hemp (e.g., terpenes and phytocannabinoids) can effectively replace some of the synthetic ingredients in household products.

Now that many of the legal restrictions have been lifted in the U.S., Canada, and other countries, industries across the globe finally have access to hemp sources that can be used as natural ingredients in their products.

Imagine disinfectant wipes that are not only as effective as traditional wipes but also made entirely of plant-based ingredients instead of harsh synthetic chemicals. Toothpaste could naturally fight harmful bacteria that cause disease and other oral health concerns without any synthetic chemicals that have harmful side effects. The possibilities of plant-based ingredients are endless, and it’s time manufacturers fully embrace them.

Using Cannabinoids for Plant-Based Products

In the consumer products industry, a growing number of companies are using hemp extracts with cannabinoids, such as cannabidiol (CBD). Yet even with the legal freedom to use these ingredients, manufacturers still face significant challenges in switching out synthetic substances for hemp extracts and other plant-based ingredients.

First, they need to choose the right hemp extracts for their products and make sure their customers understand and can track those ingredients. Manufacturers also need to know the implications of including certain types of hemp extracts in products sold in countries with varying cannabis laws. With the following tips, manufacturers can use high-quality hemp extracts to enhance the natural content and appeal of their products:

1. Brush up on the laws in any country where you operate.

The growth and use of hemp extracts with CBD and other cannabinoids are largely legal in North America, which is a hub of international trade for any market. But the specific laws that govern its use —particularly in oral and topical health products — are mostly localized.

Laws governing the use of hemp extracts in these products may differ across states in the U.S., and those same laws can vary significantly from legislation in Canada. As a result, you’ll need to pay close attention to both local and federal laws wherever your customers reside.

2. Research the right extracts, and test repeatedly.

Because hemp has such a wide variety of compounds, you should learn how the different types of extracts can apply to your products. Plenty of research has gone into the cannabinoids of tetrahydrocannabinol (THC) and CBD, but there are more than 100 other phytocannabinoids in the hemp plant.

Research and test multiple variations repeatedly to discover what works best with your consumer products. With natural, synthetic-free ingredients, you’ll also have to test different methods to perfect your new formulas.

3. Conduct studies to prove the enhancement of your products.

As more outside studies add weight to the benefits of plant-based products — including those with hemp extract and its phytoconstituents — there are plenty of opportunities to conduct your own scientific research to prove your product’s performance.

The best way to do this is through well-designed clinical and consumer insight studies. Research that highlights a product’s day-to-day benefits (such as a natural alternative for a cleaning product or a plant-based body balm to massage into tired or tense muscles) provides the most appealing data to consumers.

4. Understand any marketing challenges.

After nailing down the specific hemp extracts you want to use and then testing your products, revisit the specific regulations in the different states, provinces, and countries that make up your customer base. When it comes to marketing plant-based products that contain hemp extracts, the rules can be tricky.

In Canada, for instance, you’re not allowed to promote brands that use hemp with CBD, and these products are only sold through licensed online or brick-and-mortar distributors. There are various places you can market hemp brands and products in the U.S., however, but you need to avoid making any disease-related claims that would render your product an unapproved drug.

While these might seem like tough challenges to overcome — how are you supposed to showcase your product if you can’t market it? — consumers will put effort into finding brands focused on providing natural, synthetic-free consumer products.

Choosing to go plant-based not only frees your products of potentially harmful synthetics, but it also gives you a much broader customer base. The rush to create “fake,” synthetic products is over. We have now entered the plant-based revolution.

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Photo: Michael Cammarata at the New York Stock Exchange.

Michael Cammarata is the president and CEO of Neptune Wellness Solutions, an innovative wellness company offering high-quality, environmentally friendly, natural alternative products. Michael is also the co-founder and former CEO of Schmidt’s Naturals, one of the world’s fastest-growing wellness brands and a Unilever acquisition. He is on a personal mission to invest in and scale companies globally that will make sustainable innovation and modern wellness solutions accessible to the world.

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Archives, Features, Global Trade Daily, Stories

LEADERS BY EXAMPLE: 10 INDUSTRY EXECUTIVES USHERING IN THE GREEN REVOLUTION

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A Nielsen survey found that 81 percent of global consumers feel companies should help improve the environment. “Business strategies must include sustainability in their core beliefs and practices,” says Hitendra Chaturvedi, a professor at the Supply Chain Department of W.P. Carey School of Business at Arizona State University and an expert on global supply chain sustainability and strategy.

Fortunately, there are forward-looking leaders like the executives who follow that prove you can go green and succeed in business.

Simon Paris – CEO, Finastra; Chairman, World Trade Board

As the chief executive of one of the world’s largest fintech companies, while also chairing the World Trade Board, Simon Paris is in a unique position to talk about protecting the global trade system. Heading into the 2020 World Trade Symposium in his company’s hometown of London, Paris wrote about countering today’s protectionist narrative with “our reinforcement of the pro-trade narrative,” and he also called for ideas to reduce the small and medium-sized enterprises’ (SME) funding gap, currently estimated at $1.5 trillion. But he ended with a plea to “examine how open technology can act as the enabler for inclusive, sustainable trade.

As global supply chains become increasingly complex, our goal should not be measured on a binary figure of turnover or profit, but on the ethical and sustainable impact of our technological innovation; our technological social responsibility. How can we use technology, collectively, to ascertain the provenance of materials, improve the health and wellbeing of workers in remote locations, reduce the cause and effects on environment pollution of long-distance transportation or minimize the impact of waste and disposal? How can we use open finance technologies–and by this, I include open systems, open software, open APIs, open standards and open partner networks–to transform supply chains and encourage the formulation of more relevant and inclusive trade models, in support of ethical trade?”

Detlef Trefzger – CEO, Kuehne + Nagel International AG

This year, all less-than-container-load (LCL) shipments by Kuehne + Nagel began being CO2 neutral, which is part of the Swiss global logistics and transportation company’s goal of being totally CO2 neutral by 2030. “As one of the leading logistics companies worldwide, we acknowledge the responsibility we have for the environment, for our ecosystem and essentially for the people,” explains K+N CEO Detlef Trefzger, who along with his company supports the aim of the Paris agreement on climate. To that end, the company has also begun carbon-swapping nature projects in Myanmar, New Zealand and elsewhere.

Ongoing training programs maintain and expand the environmental awareness of employees, who have increasingly relied on video conferencing over business trips. In December, K+N announced its accession to the Development and Climate Alliance, which was launched in 2018 to simultaneously promote the development and environmental protection. “As a globally operating company, we are convinced that the private sector must also make its contribution to environmental protection,” says Otto Schacht, a member of K+N’s management board responsible for Seafreight.

Uwe Brinks – CEO, DHL Freight

DHL is a leader in piloting alternative drivetrains and fuels for its vehicles, which fits into the San Francisco-born, Germany-based global logistics giant’s target to reduce all its transportation emissions to zero by 2050. “Our sustainability goal is not just a vision, but a clear statement,” says Uwe Brinks, CEO of DHL Freight. “In the future, we will give preference to transportation solutions that contribute to achieving our environmental goals.”

To that end, DHL launched “Terminal for the Future,” which tests and implements solutions and technologies such as automated volume measurement, intelligent yard management, and partially autonomous transfer vehicles. “All these developments are based on a clear approach: We want to make life easier and more efficient for our customers and employees,” Brinks says. “Technology should support our employees in their everyday work, not replace them.” Globally, DHL has changed vehicles in certain delivery fleets to use alternative fuels, including electricity and compressed natural gas, to meet the goals of its GoGreen project to reduce emissions of greenhouse gases and local air pollutants by 2025.

David Abney – CEO, UPS

 As leader of one of the largest logistics companies in the world, UPS CEO David Abney sums up sustainability success best when he says: “The greenest mile we ever drive is the one we don’t drive.” Better route-planning software and developments have been key to the UPS green transport system—as well as its bottom line: The company claims to have saved $400 million since overhauling the routing system.

But UPS has not stopped there, having switched out dozens of diesel trucks, which get about 10 miles per gallon, for electric vehicles that can squeeze out the equivalent of 52 MPG. Abney and UPS recognize they are an important part of the global supply chain and that their customers expect solutions that help reduce emissions. To that end, UPS has dedicated itself to building the smart logistics network of the future.

Ben McLean- CEO, Ruan

When Des Moines, Iowa-based Ruan was announced in October as a 2019 SmartWay Excellence Award recipient from the U.S. Environmental Protection Agency, CEO Ben McLean would have been forgiven if he’d reacted by saying, “Meh.” After all, this is the fourth time the green 3PL provider has received the EPA’s highest recognition for demonstrated leadership in freight, supply chain, energy and environmental performance. Of course, McLean—like everyone else at Ruan—was honored to again receive the honor. “This distinction from the EPA validates all the efforts and investments we have made to ensure we are operating as sustainably and environmentally friendly as possible,” said James Cade, vice president, Fleet Services. “To us, sustainability is more than a business practice—it’s our moral commitment. We live in the communities we serve, and it is our responsibility to provide leadership toward a cleaner future.”

Recognition is understandable given that Ruan is one of only three for-hire transportation companies selected for the National Clean Fleets Partnership membership and participation in its annual Clean Cities study. The company’s fleet has green specifications including auxiliary power units that reduce engine idle time, efficient progressive shifting, auto-inflation trailer tire systems, and onboard recorders that monitor MPG, over-RPM, idle time, hard breaking and over-speed driving. Ruan also utilizes alternative fuel types including biodiesel, compressed natural gas, renewable natural gas and renewable hydrocarbon diesel. McLean, part of the third generation of the Ruan family, was out in front of his office to check out a prototype electric truck from Tesla, which has five orders from the company.

Simon Cox – Head of Sustainability, Prologis

At the World Economic Forum in Davos, Switzerland, in January, San Francisco-based global logistics real estate firm Prologis was revealed to be No. 6 in the U.S. and No. 26 overall on the 2020 Global 100 Most Sustainable Corporations in the World List. Those that make the list represent the top 1 percent in the world on sustainability performance, according to the Global 100 administrator, Toronto-based Corporate Knights. Prologis leases modern logistics facilities to about 5,100 customers principally across two major categories: business-to-business and retail/online fulfillment. It was among 7,395 companies worldwide that Corporate Knights analyzed.

“Sustainability has moved beyond simply a commercial advantage; it is now essential—business-critical,” Simon Cox, Prologis’ head of Sustainability, recently told Eye for Transport (EFT) by Reuters Events. “… We build warehouses that are ready for the next generation, who want to work for companies that do the right thing. Globally, we are seeing a move towards purpose-based products. It’s no longer enough to simply make something that cleans the kitchen, for example, it’s got to have a broader purpose. It’s got to be environmentally responsible. It’s the same for us as a business that develops and owns sustainable buildings.”

JJ Ruest – President and CEO, CN (Canadian National Railway)

Landing a spot for the first time on the 2020 Global 100 Most Sustainable Corporations in the World List is CN, at No. 54. That recognition comes exactly 12 months after the Canadian National Railway marked its 10th straight year as a global leader on corporate climate action on the CDP Climate Change A list. Produced at the request of 650 investors with assets of over $87 trillion and/or 115 major purchasing organizations with $3.3 trillion in purchasing power, the A list is culled from thousands of companies that submit annual climate disclosures for independent assessments from CDP, an international nonprofit that seeks public and private sector reductions in greenhouse gas emissions as well as the safeguarding of forests and water resources.

CN transports more than $250 billion (Canadian) worth of goods annually for a wide range of business sectors, ranging from resource products to manufactured products to consumer goods, across a rail network of approximately 20,000 route-miles spanning Canada and U.S. cities such as New Orleans, and Mobile, Alabama as well as the Chicago, Memphis, Detroit, Duluth, Minnesota/Superior, Wisconsin and Jackson, Mississippi metropolitan areas. “Our commitment is to help our customers deliver responsibly by providing a safe, efficient and environmentally friendly way to move goods,” says CN President and CEO JJ Ruest. “To that effect, we have improved our fuel efficiency by 39 percent over the past 25 years.”

Kai Nowosel – Chief Procurement Officer, Accenture

Also landing on the 2020 Global 100 Most Sustainable Corporations in the World List (at No. 20, up from No. 93 the year before), as well as making the CDP Climate Change A list is Accenture PLC, an Irish multinational that provides strategy, consulting, digital, technology and operations services. From offices around the world—including 10 U.S. cities from Boston in the east to Irvine, California, in the west, and Seattle in the north to Houston in the south—Accenture uses “purchasing power to drive positive change on a global scale, creating more sustainable supply chains,” according to Chief Procurement Officer Kai Nowosel. “It also allows us to advance our key priorities, including environmental action, respect for human rights, inclusion, diversity and social innovation.”

Accenture has committed to using 100 percent renewable energy across its global portfolio by 2023. “We will be encouraging similar ambition from our value chain, and ideally reporting progress through established platforms such as CDP supply chain,” Nowosel says. “… We will actively seek partnerships and suppliers that are even more closely aligned to our corporate values so that, together, we will improve the way the world works and lives.”

Alexander Saverys – CEO, CMB (Compagnie Maritime Belge)

CMB’s bold CO2 pledge is “Net Zero as from 2020–ZERO in 2050.” The strategy involves having all carbon emissions from CMB operations completely offset (or net-zero) from this year, while the investment in new technologies will create a completely zero-carbon fleet by 2050. CMB started by supporting certified climate projects in developing countries and acquiring high-quality Voluntary Carbon Units (VCUs) in Zambia, Guatemala, and India. Back at CMB’s home base, the Port of Antwerp in Belgium, the company’s “Hydroville,” the world’s first sea-faring vessel to burn hydrogen in a diesel engine, shuttles up to 16 passengers while producing zero pollution. That won the company the second-ever Sustainability Award from Antwerp Port Authority, Alfaport-Voka and the Scheldt Left Bank Corp. in November 2018.

CMB is now hard at work on “HydroTug,” a tugboat that will hit the water later this year or next using the same hybrid hydrogen/diesel technology as Hydroville. Hybrid barges would soon follow, and the company hopes to launch the world’s first hydrogen-powered container ships in the next decade. “Green hydrogen-based fuels are the only zero-emission solution in the long run,” according to CMB CEO Alexander Saverys. “… We are convinced of the potential of hydrogen as the key to sustainable shipping and making the energy transition of a reality.”

Thibaut de Lataillade – Global Vice President and General Manager, GetApp

Founded in 2010, the Barcelona, Spain-based Gartner company GetApp is an online resource for software buyers to compare products side-by-side with free interactive tools, detailed product data and user reviews. GetApp also serves as an online lead generation channel for SaaS. And the company also provides customers with sustainability advice. “Our main focus is on helping businesses become more efficient through technology and software,” says Thibaut de Lataillade, GetApp’s global vice president and general manager. “As consumers become more conscious of sustainability, businesses must adapt their supply chain processes. This means mapping their supply chain, setting goals and measuring supplier performance when it comes to sustainability. Using the right software to analyze and leverage data captured through this process will help business leaders make the right decisions and ensure sustainability in the future.”

GetApp doesn’t stop there. “We’ve also tried to highlight the many other benefits that come from becoming a socially responsible business. For instance, corporate social responsibility (CSR) can also lead to improved brand awareness and improved customer trust, loyalty and engagement,” de Lataillade says. “As a digital business, we have a duty to spread the message when it comes to creating a social impact strategy, and doing so for the right reasons.”