Logistics market leader's ESG innovations

DHL Express

5. Gender Equality 10. Reduced Inequalities 13. Climate Action 16. Peace, Justice and Strong Institutions

Overview

DHL Express, as one of the largest logistics companies in the world, is committed to doing business according to the criteria of sustainable development in the environmental, social, and governance fields (ESG). Within these principles, DHL implements several projects with decarbonization, social inclusion, and sustainable management being among them.

Authors

Ivan Blokhin

Ivan Blokhin

Nikita Arsentev

Nikita Arsentev

Kristina Viskova

Kristina Viskova

Sophia Panaiotidi

Sophia Panaiotidi

Vasily Katrovsky

Vasily Katrovsky

Daria Klindukhova

Daria Klindukhova

School

The Russian Presidential Academy of National Economy and Public Administration (RANEPA)

The Russian Presidential Academy of National Economy and Public Administration (RANEPA)

Professor

Natalia Yankovskaya

Natalia Yankovskaya

Innovation

As part of the ESG program, DHL Express has developed a decarbonization strategy to reduce greenhouse gas emissions by the Paris Climate Agreement. Thereby the company contributes to slowing down global warming and climate change in general. Therefore, DHL's decarbonization program contributes to the achievement of the UN SDG 13 (climate action). In 2017, DHL became the first logistics company in the world to announce its commitment to zero greenhouse gas emissions from its operations by 2050. In this context, the group offers many innovative solutions that help to improve the sustainability of supply chains and enable customers to achieve their environmental goals. Also, to accelerate the movement towards decarbonization, investments of 7 billion euros in climate-neutral logistics until 2030 are envisaged. Deutsche Post DHL is actively involved in the development and use of fuels from renewable energy sources. As Anna Klinskova, Managing Director of DHL Express Russia, noted, “Since last year, we’ve started using Sustainable Aviation Fuel, which does not leave a carbon footprint and can be used as an additive to the main fuel, so we plan to increase the usage of this technology in our aircraft to 30%”. In addition, the company has launched into the network 12 fully electrified aircraft with a zero-carbon footprint. The Clean Operations program also includes e-vehicles and electrification of 60 % of our last-mile delivery by 2030. The group also invests in environmentally friendly properties (offices, sorting and logistics centers, warehouses). With all these steps and measures, DHL has implemented a carbon-neutral customer experience that enables our customers to meet their carbon footprint KPIs and their sustainability targets.

DHL aims to be the best employer not for a group of people, but everyone. It can be said that the ESG strategy at DHL has a serious impact on the company's employees. And to be a great employer, the important goals of DHL are to improve the safety of personnel, maintain the level of staff involvement and increase the number of women in the company's management (SDG 5 (Gender equality)). By corporate principles and the desire to achieve results, it is planned to increase the share of women in the company's management to at least 30%. Speaking of occupational safety, the safety of personnel at DHL comes first. The highest levels of personnel safety have already been achieved in the European region. DHL has a goal to maintain high team member engagement rates, which according to the results of the annual Employee Opinion Survey in 2021 achieved 92 points. To boost the team member’s engagement the company creates an atmosphere of openness and dialogue encouraging employees to take an active part in designing the workflow and work processes. The company respects the reliability and transparency of the company's management. Employees get the opportunity to study and get more profound knowledge of how the network works as well as enhance their soft skills. Upon completion of their study, they receive certificates and later refresh their knowledge and move to the next level of the learning program. Another important aspect of management is information security. The company trains employees in this area, raise their level of awareness, and thus protects them against cyber threats. Another key factor is compliance with ethical standards, as well as legal ones about employees. The company's Code of Conduct is based on the establishment of equality and cultivating the proper spirit through training that helps employees understand the human rights, act with respect, and support diversity and integration, as well as the prevention of forced labor and other compounds of the Human Rights Policy Statement. The company expects all its suppliers to share the same beliefs and high standards in the scope of the Human Rights issues and requires them to accept the Supplier Code of Conduct.

DHL has an effective corporate governance policy. Implementing a policy on financial management and oversight, pay, and business objectives help an organization to stay focused while building trust with employees, customers, and any investors and partners. Anna Klinskova emphasizes: “Our goal is to strive to be a company with an impeccable business reputation, complying with all laws in all countries in which our business is located. In general, the implementation of the management criteria correlates with certain provisions of the UN SDG 16 (Peace, Justice, and Strong Institutions).

All employees of the company follow the Company’s mission: Connecting people and improving their lives. According to Anna Klinskova, the main idea is that many innovative projects are initiated by the employees themselves, and the company supports them in implementation. Employees thus contribute to creating the best products for customers, helping their business grow and making their life easier if we speak about private customers – in other words improving their lives which is in line with the mission of DHL”.

Logistics market leader's ESG innovations

Inspiration

“ ‘Connecting people, improving lives' is our guiding star, which shows us the way in any times, this is the ideology which we stick to,” said Anna Klinskova. Moreover, in her opinion, DHL employees share this mission and live in accordance with its principles far beyond the work scope. It is this principle that maintains DHL's ESG strategy and other projects.

Thus, it is DHL's corporate culture that inspires its leaders and employees to implement the ESG program. Variations of this guiding principle appear in other forms. According to DHL CEO Frank Appel, "We are building a sustainable business and making an important contribution to the planet and society." In other words, the desire to preserve the environment and improve society has inspired DHL leaders to implement the environmental part of the ESG program. Another inspiration for focusing on the environmental agenda is the desire to lead by example and ensure a sustainable future for the logistics industry. “I am convinced that by focusing more on ESG-compliant targets, we will remain the No. 1 choice for customers, employees and investors and will be able to lay the foundation for long-term economic success,” noted Frank Appel.

In the implementation of social and corporate agendas, the leaders of the company are guided by the importance of corporate standards and trends in the development of the business and its movement towards success. “The motivation of our employees and the diversity of our staff is the key to excellent service quality and a high level of customer satisfaction. Customer satisfaction, in turn, is the basis of economic success. This is another reason why we believe in the value of actively implementing an equal opportunity policy,” said Thomas Ogilvy, Head of Human Resources and Labor Policy at the Deutsche Post DHL Group.

Overall impact

In general, following the ESG criteria contributes to the sustainable growth and development of DHL. The implementation of the environmental aspect makes it possible to increase the share of alternative energy sources and thereby reduce exhaust emissions. Therefore, it has a positive impact on the fight against climate change. The adaptation of the social aspect improves the lives of employees in accordance with the core principle of DHL's corporate culture. An important point is that DHL's commitment to sustainability, as well as the successful implementation of the ESG principles, sets an example for other large companies, accelerating the movement towards sustainability.

Regarding governance, it allows the company to expand the scope of its cooperation (that is, to develop both within the country and abroad), thus increasing the importance of the economy. It is important to take into account not only financial indicators but also a number of other factors. The corporate ethics that DHL implements allow to identify the effectiveness of management and increase the profitability of the company (this can be seen in the net profit indicators). Employee training provides them with additional motivation and competence improvements in their field of activity. The better they cope with the tasks, the more satisfied they are with their work which makes them ready to perform even better.

Business benefit

The current all-around concern about the environmental agenda contributes to the growth of the population's environmental awareness. Given this trend, the implementation of the environmental criteria contributes to attracting new customers. In addition, the implementation of a sustainable strategy makes DHL a more promising employer. These benefits improve the performance of the company and increase its revenues.

According to the results of 2021, DHL took 11th place among the largest employers in the world. This company has 590 000 employees, and every year that number is increasing. DHL creates hundreds of jobs in each of 220 countries.

In 2021, DHL Express has been named the number one best workplace worldwide in the annual list published by Great Place to Work™ (GPTW) in collaboration with Fortune Magazine. This proves that DHL people, who work for the company are the biggest asset, and engagement and motivation of the employees are the prerequisites for sustainable success.

The emphasis on labor safety is also part of the ESG and corporate culture of DHL. This is evidenced by the data on Lost Time Injury Frequency Rate (LTIFR): over the past year, this indicator has not increased, which means that the high labor safety standard has not decreased.

The recruitment policy pursued by the company ensures the development of personnel management strategies, forecasting of personnel potential, and evaluation of the work performed and its results. The information system that DHL is implementing affects the company's activities by creating new opportunities for personnel management. Employees are becoming more efficient. The development of rules and methods for evaluating staff performance of their duties form a sense of responsibility among employees, as well as the corporate culture standards in general.

Social and environmental benefit

The measures taken as part of the environmental program have already had a positive impact on the environment. In particular, in 2021, the realized effect of DHL decarbonization around the Globe amounted to 728 kilotons of carbon dioxide. An additional 172 kilotons of CO2e reduction was achieved with mandatory biofuel blends. As well the number of vehicles with alternative drive increased by 46%, while the number of cars with conventional drive remained almost unchanged. All these facts indicate that thanks to the ESG program, it was possible to significantly reduce atmospheric pollution by greenhouse gases and other harmful substances. Consequently, DHL's efforts have contributed to the reduction of environmental pollution and helped to prevent negative climate trends. The high level of involvement of DHL employees in the implementation of sustainable development goals allows implementation environmental programs around the world. The GoGreen program provides for forest restoration, which is already being actively implemented: the company's employees have already planted millions of trees around the world.

DHL’s sustainable management strategy has strengthened morale in the society, as the proclamation and implementation of an ethical approach to management sets a trend and can spread to other organizations. Since the corporate strategy of DHL includes respect for human rights, the application of this strategy should improve the legal status of the employees and, consequently, their standard of living.

Interview

Anna Klinskova, Managing director of DHL Express Russia

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DHL Express

DHL Express

Bonn, DE

Business Website: https://www.dhl.com

Year Founded: 1969

Number of Employees: 10000+

DHL Express is one of the leaders in the international express delivery market with a global network of offices in many countries around the world. This company was the first in the logistics industry to set up door-to-door express delivery and to declare environmental protection.