Relevant Issues (6 of 26)
- GHG Emissions The category addresses direct (Scope 1) greenhouse gas (GHG) emissions that a company generates through its operations. This includes GHG emissions from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes), whether a result of combustion of fuel or non-combusted direct releases during activities such as natural resource extraction, power generation, land use, or biogenic processes. The category further includes management of regulatory risks, environmental compliance, and reputational risks and opportunities, as they related to direct GHG emissions. The seven GHGs covered under the Kyoto Protocol are included within the category—carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3).
- Air Quality The category addresses management of air quality impacts resulting from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes) as well as industrial emissions. Relevant airborne pollutants include, but are not limited to, oxides of nitrogen (NOx), oxides of sulfur (SOx), volatile organic compounds (VOCs), heavy metals, particulate matter, and chlorofluorocarbons. The category does not include GHG emissions, which are addressed in a separate category.
- Energy Management
- Water & Wastewater Management
- Waste & Hazardous Materials Management
- Ecological Impacts
- Human Rights & Community Relations
- Customer Privacy
- Data Security
- Access & Affordability
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
- Labor Practices The category addresses the company’s ability to uphold commonly accepted labor standards in the workplace, including compliance with labor laws and internationally accepted norms and standards. This includes, but is not limited to, ensuring basic human rights related to child labor, forced or bonded labor, exploitative labor, fair wages and overtime pay, and other basic workers' rights. It also includes minimum wage policies and provision of benefits, which may influence how a workforce is attracted, retained, and motivated. The category further addresses a company’s relationship with organized labor and freedom of association.
- Employee Health & Safety The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
- Employee Engagement, Diversity & Inclusion
Business Model & Innovation
- Product Design & Lifecycle Management
- Business Model Resilience
- Supply Chain Management The category addresses management of environmental, social, and governance (ESG) risks within a company’s supply chain. It addresses issues associated with environmental and social externalities created by suppliers through their operational activities. Such issues include, but are not limited to, environmental responsibility, human rights, labor practices, and ethics and corruption. Management may involve screening, selection, monitoring, and engagement with suppliers on their environmental and social impacts. The category does not address the impacts of external factors – such as climate change and other environmental and social factors – on suppliers’ operations and/or on the availability and pricing of key resources, which is covered in a separate category.
- Materials Sourcing & Efficiency
- Physical Impacts of Climate Change
Leadership & Governance
- Business Ethics
- Competitive Behavior
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management The category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
- Systemic Risk Management
Disclosure Topics (Industry specific) for:
Air Freight & Logistics
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Greenhouse Gas Emissions
Companies in the Air Freight & Logistics industry generate direct greenhouse gas (GHG) emissions that contribute to climate change. Emissions are generated from fuel combustion by both air and road freight operations. Given the altitude of the emissions from jet fuel, air freight makes an especially potent contribution to climate change. Management of GHG emissions is likely to affect air freight and logistics companies’ cost structure over time, as emissions are tied directly to fuel use, and thus to operating expenses. Fuel efficiency and the use of alternative fuels offers a way for companies to reduce fuel costs and/or limit exposure to volatile fuel pricing, future regulatory costs, and other consequences of GHG emissions. While newer aircraft and trucks are generally more fuel-efficient, existing fleets may be retrofitted. Capital investments in more fuel-efficient airplanes and/or vehicles and emerging fuel-management technology may potentially reduce ongoing fuel expenses and improve profitability. It can also help companies potentially capture market share of customers seeking low-carbon shipping solutions.
Companies in the Air Freight & Logistics industry generate air pollutants that may threaten human health. The industry’s primary air emissions include sulfur oxides (SOx), nitrogen oxides (NOx), and particulate matter (PM), which have localized negative effects on air quality. As regulators debate the most efficient mechanisms to reduce local air pollution from the industry, companies may be forced to increase operating costs or make investments to modernize their fleets due to regulatory pressure, customer demand, and rising fuel costs. Use of more expensive alternative fuels and mechanisms that filter emissions prior to release into atmosphere can also impact a company’s cost structure, requiring upfront costs but decreasing exposure to regulation over the long term.
The Air Freight & Logistic industry’s reliance on independent contractors, mainly for courier driving, has come under increasing regulatory scrutiny. Independent contractors may not be not covered under the same laws that protect employees, and companies may face regulatory sanctions for misclassifying employees as independent contractors. Companies may also face legal actions from employee and contractor claims regarding wage payments, benefits, and working conditions. This may also negatively affect their reputation and ability to hire and retain employees, reducing operational efficiency and increasing turnover costs.
Employee Health & Safety
Employee Health & Safety
Employees in the Air Freight & Logistics industry may be exposed to dangerous working conditions, including accidents resulting from mechanical failure or human error. Additionally, moving packages manually is a physical process that requires special training in order to minimize injury. While the fatal occupational injury rate for trucking workers is higher than average, worker safety issues in aviation are highly regulated, which raises the risk of fines or penalties when an incident occurs. Health and safety incidents may result in work stoppages and a range of costs, from medical expenses to workers compensation. Such incidents can also reduce productivity, and thus revenues, if employees believe their safety and well-being are not being prioritized. Finally, companies with poor safety records may also face increased insurance premiums and higher costs of capital, as well as reputational damage that could reduce revenue and market share. A company can mitigate these impacts by providing adequate protection and training for employees, ensuring mechanical equipment is safely functioning, and establishing a culture of safety within the workplace.
Supply Chain Management
Supply Chain Management
Many companies in the Air Freight & Logistics industry contract with large, complex networks of asset-based third-party providers to provide freight transportation services to their customers. Contracting is especially common among companies providing freight forwarding, logistics, brokerage, and intermodal services. These contractors range across all modes of transport such as motor carriers, railroads, air freight, and ocean carriers. Companies need to manage the relationships with their contractors in order to ensure that contractor actions that lead to environmental or social impacts do not result in material adverse effects on their own operations, such as decreased brand value. At the same time, companies that are able to offer low-carbon logistics solutions may capture market share from customers seeking to reduce the carbon footprint of their shipments.
Critical Incident Risk Management
Accident & Safety Management
All modes of transportation pose safety risks. In some cases, mechanical failure or human error may lead to accidents with significant environmental or social consequences, including regulatory action and lawsuits from impacted communities or customers. While the stringency of regulatory requirements may vary by the region of operation, companies that maintain the highest safety standards throughout their global operations can minimize the risks of safety incidents that affect their reputation and profitability.
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