Maersk proved that moving closer to customers can actually be beneficial! As shippers became more concern about their carbon footprints shipping companies had to make a move. Maersk was a pioneer in introducing slow - steaming and hybrid engines in order to lessen its environmental footprint. Since then the Group has been agressive in its efforts to reduce its vessels carbon emissions and to turn that reduction into a competitive advantage by differentiating itself as the greenest carrier.
For instance, the company announced it is getting independent third-party verification of its carbon dioxide emissions and introduced the so called CO2 Dial in its monthly customer scorecard, so each customer can see what its footprint has been by shipping with Maersk Line over the last month, and also can see how that compares to what it would have been if they shipped with an industry-average carrier.
Maersk also set three goals for reducing its environmental footprint: cutting CO2 emissions by 25 percent by 2020; eliminating sulfur oxide emissions altogether; and reducing the overall impact of its vessels on the marine environment by purifying its ballast emissions, using non-toxic paint in vessel hulls and making sure there are no oil spills, or having procedures in place to cope with them if they occur.
By doing so Maersk has not only reduced its customers' carbon footprints, but it has also reshaped the whole industry! All other carriers have already started following this fine example. For instance, APL, the world's sixth largest carrier by fleet capacity introduced slow-steaming in 2009. What is more, the company already has a separate website devoted to its environmental initiatives!
Ocean carriers are realizing that helping their big customers lessen the environmental footprint of their supply chains also can reduce ship costs and maybe even give them a marketing edge. The World Ports Climtate Initiative that will introduce the International Ship Index, the Clean Cargo Working Group of Business for Social Responsibility, the support of the Global Compact, the CO2 Dial are only a part of all initiatives Maersk started. I'm very happy that there is such a company that's not "greenwashing" but is actually really "green" and good, especially in such an industry! I recently read that this month Maersk has donated 300 ships worth 500 000 dollars to help a charity called Advance Aid to ship emergency kits to Africa!
Maersk has been very proactive in its efforts to be ethical and I think companies from all industries should take this as a great example of how to be good! Recently I read a statement somewhere which said that a company can't increase its profit being environmentally friendly. Well, by exceeding its previous $4bn forecast for annual net profit I think Maersk just did the opposite!
This is a very good article explaining the environmental and commercial strategy of Maersk.
ReplyDeleteI think it is very significant that this company originates from Denmark - one of the most conscious about the environment countries.
I will also add that slow steaming is beneficial strategy in many aspects. Besides the lower carbon emissions, this approach leads to massive fuel savings and helps Maersk to keep its ships busy during the current recession. When the financial crisis started in September 2008, the demand for container shipping fell sharply. In 2009 there were more ships than cargo and this resulted with hundreds of container ships being kept idle.
Maersk were the first to realise that while slow steaming may be not very good for the ship engines, it is still much better than no steaming at all.
Lower speed means that more ships are necessary to cover a string, which used to be covered by ships sailing with cruising speed.
So, the ships were kept sailing, the seafarers employed, the fuel bill was reduced and an effort was made to protect the environment.
Maersk deserve great credit for innovative thinking.
Saying that companies cannot boost their sales by being environmentally friendly is total crap!
ReplyDeleteBeing ethical in my opinion, is used as a major marketing strategy at some point or other in an organisations life span. It praises the corporation, makes it trustworthy, makes it reliable, and most essentially takes away customers from their competitors who cannot keep up with ethical standards and new ethical technology.
I am very impressed with Maerk's work and hope that as their revenue continues to grow that they keep focusing on helping communities aswell as concentrating on their overall global impact.
Could I just ask what type of products are shipped by Maersk and what are the countries they travel mainly to and from?
Maersk's custommers are big companies such as IKEA, Coca-Cola, Starbucks etc. so basically the company shipps all kind of products. we all know that such big names became very sensitive about carbon footprints etc. so, if Maersk wants to keep its customers it has to comply. However, instead of only complying it's started leading which is the great part of the story!
ReplyDeleteI do agree with you that becoming green is helpful in most cases! Hope more companies will follow this example!
Maersk's environmental initiatives are commendable. However, slow steaming had nothing whatsoever do to with saving the planet.
ReplyDeleteMaersk (and I might add several other top global carriers) switched to slow steaming in late 2009 to control capacity (i.e.supply) and keep freight prices from falling further into the abyss. The container shipping industry lost close to $20 billion in 2009, then on the back of slow steaming initiatives made over $15 billion in 2010.
The industry is such that large ships must be ordered several years in advance of delivery. Obviously, when those ships are delivered carriers cannot predict the state of the market. Thus, huge ships and additional capacity are added in 2010, 2011 and 2012. The carbon footprint measurement is not so much the savings of fuel, but the fact that with large ships the CO2 per container in transit is reduced as the emmissions are spread over a greater number of containers.
Interesting article Maria. Good interpretation and I would like to add few more points. Shipping industry at the moment is going through drastic self evaluation process under the flag of IMO as this is the only industry which does not come under any government and hence under Kyoto Protocol either. IMO is busy in formulating ways of how to make ships accountable for their GHG emissions and therefore big shipping companies such as Maersk is taking proactive approach and making such policies.
ReplyDeleteAnother influencing factor is that around 40% of GHG emission in Denmark comes from Maersk (although its not solely due to ships but due to organization building etc) and this probably forces indirectly Maersk to have concrete environmental policy. Therefore if you combined both these aspects (IMO initiative and Maersk's own position in Denmark), you will find Maersk has much more incentive to have a sound 'sustainability / environmental policy' rather than not having.
Once a company creates a policy, it may not sell the same policy openly to its customers telling what was exact reason and therefore it sells the policy by putting some cover on it and that cover is called 'value added'. So when Maersk started having GHG footprint, it showed its customers a different reason than what it has but in either case it was far better than what other companies in industry are doing.
The comment about slowing down ships to reduce GHG emission is also two way process. Its not solely due to motivation of reducing GHG emission but it depends on demand and supply of customers whose containers are on those ships. If you are aware of supply chain industry, then you will be knowing just-in-time(JIT)system where manufacturing company wants its goods to be delivered at exact moment. But I suppose in slow economy (when demand is not high), every manufacturing company could not follow JIT and therefore they can be little slack, which gives a shipping company time to slow the ship, increase fuel efficiency(ship's engine perform best at slower at speed than at their highest rated speed, this is another point but I do not want to touch that), reduce fuel consumption (at slow and optimum speed fuel is less consumed) and consequently less GHG emissions. But, since everyone is not aware of other benefits(rather not interested) company promulgates whole thing as if it is driven solely by the desire to reduce GHG emission.
There are many more things to add but I believe that given the scope of blog, its an excellent article to read.
thanks for your comment napoli! i'm really pleased that people interested and aware of the issue are commenting on my blog!
ReplyDeleteyes, i totally agree with everything you wrote. i would add, from a Comms person point of view, that companies usually send different messages to their various stakeholder groups and in my opinion that's why not all reasons for employing this green agenda are given by Maersk. Whilst writing this blog I was surprized that this new trend is already being employed by a container shipping company. As wel all know it's very fashionable to be ethical and organizations generally don't want to be approached by angry activist group. Instead, smart companies try to collaborate and even lead on the sustainability agenda. That was the main reason why I really admire what Maersk has been doing.
Of course, the main reason for adopting this green strategy is cost reductions and nobody hides that. I had a conversation with somebody from Maersk and the person admitted it and it wasn't off the record.
I can't think of a single company that decided to go green only because of their concerns about the environment. actually there is nothing bad in that because it is a catalyst for changing the way companies generally operate.
I know IMO is under pressure to eventually introduce a global regulatory framework, especially after COP16 in Cancun. I'm looking forward to seeing what's gonna happen in the coming years.
again, thank you for your comment!