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››Case study: How FedEx improves vehicle efficiency

Case study: How FedEx improves vehicle efficiency

By Gerasimos
October 27, 2018
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FedEx’s diverse portfolio of transportation, e-commerce and business solutions serves millions of customers in over 220 countries and territories around the globe, with more than 180,000 owned and contracted vehicles. Minimising its global environmental footprint by increasing vehicle efficiency is, thus, a top priority for FedEx.

This case study is based on the 2017 Global Citizenship Report by FedEx published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.

Abstract

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Abstract

FedEx’s global ground transportation operations continue to offer potential for significant efficiency gains  Tweet This!, through a number of programs and innovations. In order to improve vehicle efficiency FedEx took action to:

  • optimise truck routes
  • instill good driving habits
  • upgrade vehicle fleet to more efficient models

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What are the material issues the company has identified?

In its 2017 Global Citizenship Report FedEx identified a range of material issues, such as ethics, bribery & corruption, workplace safety, business preparedness, resiliency & disaster response, data security & privacy. Among these, improving vehicle efficiency stands out as a key material issue for FedEx.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The organization should identify its stakeholders, and explain how it has responded to their reasonable expectations.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups FedEx engages with:   

Stakeholder Group
Customers
Industry groups
Investors
Sustainability experts
Nonprofits
Government agencies

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics FedEx engaged with stakeholders through a survey and roundtable engagement session.

blankWhat actions were taken by FedEx to improve vehicle efficiency?

In its 2017 Global Citizenship Report FedEx reports that it took the following actions for improving vehicle efficiency:

  • Optimising truck routes
  • FedEx seeks to reduce overall mileage by optimising routes, matching vehicles to journey based on load volume and route length, and plotting the shortest routes. In addition, FedEx applies its logistics expertise to reduce “empty” miles, when trucks travel with less than optimal loading and uses efficient technologies such as automatic transmissions and low-rolling resistance tires. Moreover, in FY16, through the FedEx Express Reduce, Replace, Revolutionize strategy and intermodal rail shipping at FedEx Freight, FedEx saved over 43 million gallons of fuel, avoiding more than 444,000 metric tons CO2e.
  • Instilling good driving habits
  • FedEx helps drivers improve their efficiency by reducing idle time, controlling speed and using progressive shifting techniques. FedEx’s international Eco-drive education program offers both classroom and practical sessions teaching tips anyone can use to drive in an environmentally friendly way. The program also identifies routes for changing to intermodal rail, which is more fuel-efficient than roads, and opportunities to reduce “last-mile” deliveries by providing more customer pickup locations.
  • Upgrading vehicle fleet to more efficient models
  • When replacing any surface vehicle, FedEx upgrades to cleaner, more efficient models whenever possible. In FY16, FedEx added over 800 alternative-fuel/technology vehicles to its fleet. Additionally, in early FY17, FedEx installed a compressed natural gas (CNG) fueling station at the FedEx Freight Oklahoma City Service Center and purchased over 100 CNG tractors. FedEx is also exploring greater use of electric and fuel cell powered vehicles among other advanced technologies, together with alternative-fueled vehicles.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 302-1 Energy consumption within the organization

2) Disclosure 302-4 Reduction of energy consumption

3) Disclosure 305-5 Reduction of GHG emissions

 

Disclosure 302-1 Energy consumption within the organization corresponds to:

Disclosure 302-4 Reduction of energy consumption corresponds to:

Disclosure 305-5 Reduction of GHG emissions corresponds to:

  • Sustainable Development Goal (SDG) 13: Take urgent action to combat climate change and its impacts
  • Business theme: GHG emissions
  • Sustainable Development Goal (SDG) 14: Conserve and sustainably use the oceans, seas and marine resources for sustainable development
  • Business theme: Ocean acidification
  • Sustainable Development Goal (SDG) 15: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
  • Business theme: Forest degradation

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

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  • Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
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References:

1) This case study is based on published information by FedEx, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) http://www.fbrh.co.uk/en/global-reporting-initiative-gri-g4-guidelines-download-page

3) https://g4.globalreporting.org/Pages/default.aspx

4) https://www.globalreporting.org/standards/gri-standards-download-center/

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