Not your typical "tree hugger": interview with Jason Mathers
Instead of seeing businesses as foes of the environment, Jason Mathers of the Environmental Defense Fund believes that they—and their supply chain organizations—are natural allies in the fight against climate change.
Susan Lacefield has been working for supply chain publications since 1999. Before joining DC VELOCITY, she was an associate editor for Supply Chain Management Review and wrote for Logistics Management magazine. She holds a master's degree in English.
It wasn't so long ago that the term "environmentalist" conjured up images of starry-eyed anti-business idealists with shaggy hair and sandals who would chain themselves to trees in protest against efforts to cut them down. Yesterday's senior executive might have called them "tree huggers."
But Jason Mathers is not your father's environmentalist. As senior manager for supply chain and logistics at the nonprofit group Environmental Defense Fund (EDF), Mathers is dedicated to working with—rather than against—business to solve problems related to climate change. Because he helps companies find steps that can both reduce their environmental impact and save them money, you could think of him as a pragmatic idealist.
EDF says its mission is "to protect the Earth's resources using smart economics, practical partnerships, and rigorous science." Toward that end, Mathers has been working to reduce emissions from freight movements, which some estimates say are the source of 6 percent of the human-generated pollution that contributes to global warming. As part of this work, he is cataloging current best practices and developing a framework for managing emissions generated in the supply chain.
To accomplish this, Mathers works closely with shippers, carriers, third-party logistics service providers, and others to design greenhouse gas management programs for fleets, best practices and tools for tracking and reducing emissions, and training materials for fuel-smart driving. Many of those best practices have been assembled in the organization's Green Freight Handbook, which was published last year.
More recently, Mathers and EDF, along with a consortium of 12 food and apparel companies, have been working to convince the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Transportation to require America's heavy-duty truck fleets to cut their fuel consumption and carbon emissions by 40 percent.
DCV Editor at Large Susan Lacefield spoke with Mathers about EDF's efforts and about how supply chain managers can play a role in helping protect the environment.
Q: How you did become an environmentalist, and why do you focus on logistics and supply chain management in particular?
A: I think I have always been someone who has been mission-driven and interested in being part of a broader effort. That's what led me to join the U.S. Navy out of high school. After leaving the service and getting ready to go to college, I knew I wanted to do something else that was mission-driven. Working on environmental issues and climate change really spoke to me. Climate change has a huge impact on every aspect of our society today and will continue to have an impact on future generations.
Freight logistics accounts for about 6 percent of global pollution. Logistics, then, is a natural area to be part of the solution, to really be a leader. And in many cases, there's so much alignment between practices that [produce] cost savings and those that lead to environmental improvements.
Q: The military seems like an unusual proving ground for an environmentalist. Are you applying any of the skills you learned while in the military to your work at EDF?
A: One of the critical life skills I learned when I was in the Navy was the ability to break a challenge into smaller tasks. When you think about how to solve the problem of climate change, you start by looking at all the pieces that add up to cause it. [For example,] the impact of carbon dioxide emissions is a critical, big-effort issue. It's easy to be overwhelmed by it. It's so big, it can seem impossible to solve, but there are actually thousands of solutions, and all are necessary.
Q: Is it possible to be both pro-business and an environmentalist?
A: Absolutely. Why do I believe that? Because I see it every day—for example, when we are working with Pepsi-Cola to urge the EPA and Department of Transportation to put forth strong fuel-efficiency standards, or when Google and Amazon came out in court in support of clean power plants and called the transition to a "clean-energy economy" critical to their growth as companies. Wal-Mart is working every day to get toxic chemicals out of the products in its stores and out of the agricultural supply chain. There are thousands of examples of companies embracing sustainability.
Q: At some point, business needs are going to come into conflict with what's best for the environment. Do you have any advice for how to navigate those tradeoffs?
A: When a company is thinking about how it can improve its environmental footprint, there are a couple of key areas that it needs to focus on. First, it needs to look at what it can do today to improve its operations that also makes business sense, whether that be increasing load capacity when applicable or using intermodal transportation when possible. There are lots of opportunities to do this, and you should be spending 80 percent of your time on this near-term focus.
Then, the company needs to be asking, "How can we help build a future and shape it in a way that is good from an environmental perspective and is going to be good from an economic perspective?" Twenty percent of your time should be spent on this long-term focus. For example, I think of the work that FedEx is doing to get a long-term agreement in place to increase its procurement of aviation biofuels. Aviation is critical to its business and a significant source of greenhouse gas emissions. Today, there's not a lot it can do to use biofuels at the scale needed to reduce those emissions. But over the long term, it can change its access to cleaner fuels and make investments to build that market. FedEx has decided that this is a critical issue that it needs to be a part of.
Q: Why should supply chain and logistics professionals be concerned about global warming?
A: Over the last few years, we have worked to get a better sense of where emissions lie in a company's operations. [We found that] the supply chain is the source of upward of 80 percent of the environmental footprint for consumer goods companies, retailers, telecommunications companies, and food and beverage companies. So supply chain has the potential to have more impact on a company's environmental footprint than any other function.
Q: What do companies risk by not looking at how they can reduce carbon emissions?
A: There are a few risks. One is falling behind. A company like General Mills that has a long-term greenhouse gas reduction goal in place is getting more efficient every day, and it's challenging itself in a unique way. Companies that are not doing this are missing out on [opportunities for] innovation.
You also risk missing out on appealing to the next generation of business leaders, who are increasingly looking at what sustainability strategy is in place when deciding which company they want to work for.
You are also missing out on real cost savings. If we do not get stronger truck efficiency standards in place, shippers will end up paying millions of dollars a year more in fuel and total trucking costs than they would with [tighter] standards in place.
So I think there are a lot of things that you miss out on, with the biggest one being the opportunity and reason to innovate. Unless you challenge yourself, you don't know what you can accomplish. For example, FedEx set a goal of improving fleet efficiency, and the company just announced that it has exceeded its goal five years early and has ended up saving a lot of money. Wal-Mart challenged itself to double the efficiency of its fleet operation in regard to how it loads and uses its trucks, and it beat that goal earlier this year. It's impressive how much cost the company is taking out of its operations.
Q: How have things changed with respect to businesses' focus on sustainability in the last five years?
A: Companies have become more systematic about sustainability, bringing it more into their overall strategy. It used to be that companies would focus on just one or two projects, like using recycled paper or using hybrid cars for their sales fleet. While those are important steps for raising awareness, they weren't really core to the business and weren't long-term and systematic. Now, you are seeing more alignment between companies' sustainability goals and their overall strategic objectives. It's more meaningful, more impactful, and more real.
Q: What's next for EDF?
A: We have had a lot of success in developing best practices in the logistics space, and we have also done some work in deforestation and helping make factories more energy-efficient. Next, we want to pull all of these things together and provide companies with a more comprehensive roadmap across their operations in those three or four areas.
To build a more sustainable future, we need to engage government and companies in a dialogue to create smart, well-designed public policy. We see business as a critical stakeholder in this. What we would want to see is business first acknowledging the urgency of having rules and regulations and incentives in place to reduce climate change-related pollution and greenhouse gas emissions. Then, businesses need to be proactive in sharing with policymakers their experiences and steps that would help them reduce their environmental impact. A clear example is the work that Pepsi and other groups have done with heavy-duty truck efficiency standards. Fleet owners and equipment manufacturers need to be up front about the challenges they face and how we can structure rules to foster innovation.
Editor's note: This article originally appeared in the Quarter 2, 2016 issue of our sister publication, CSCMP's Supply Chain Quarterly.
The number of container ships waiting outside U.S. East and Gulf Coast ports has swelled from just three vessels on Sunday to 54 on Thursday as a dockworker strike has swiftly halted bustling container traffic at some of the nation’s business facilities, according to analysis by Everstream Analytics.
As of Thursday morning, the two ports with the biggest traffic jams are Savannah (15 ships) and New York (14), followed by single-digit numbers at Mobile, Charleston, Houston, Philadelphia, Norfolk, Baltimore, and Miami, Everstream said.
The impact of that clogged flow of goods will depend on how long the strike lasts, analysts with Moody’s said. The firm’s Moody’s Analytics division estimates the strike will cause a daily hit to the U.S. economy of at least $500 million in the coming days. But that impact will jump to $2 billion per day if the strike persists for several weeks.
The immediate cost of the strike can be seen in rising surcharges and rerouting delays, which can be absorbed by most enterprise-scale companies but hit small and medium-sized businesses particularly hard, a report from Container xChange says.
“The timing of this strike is especially challenging as we are in our traditional peak season. While many pulled forward shipments earlier this year to mitigate risks, stockpiled inventories will only cushion businesses for so long. If the strike continues for an extended period, we could see significant strain on container availability and shipping schedules,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release.
“For small and medium-sized container traders, this could result in skyrocketing logistics costs and delays, making it harder to secure containers. The longer the disruption lasts, the more difficult it will be for these businesses to keep pace with market demands,” Roeloffs said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
As the hours tick down toward a “seemingly imminent” strike by East Coast and Gulf Coast dockworkers, experts are warning that the impacts of that move would mushroom well-beyond the actual strike locations, causing prevalent shipping delays, container ship congestion, port congestion on West coast ports, and stranded freight.
However, a strike now seems “nearly unavoidable,” as no bargaining sessions are scheduled prior to the September 30 contract expiration between the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX) in their negotiations over wages and automation, according to the transportation law firm Scopelitis, Garvin, Light, Hanson & Feary.
The facilities affected would include some 45,000 port workers at 36 locations, including high-volume U.S. ports from Boston, New York / New Jersey, and Norfolk, to Savannah and Charleston, and down to New Orleans and Houston. With such widespread geography, a strike would likely lead to congestion from diverted traffic, as well as knock-on effects include the potential risk of increased freight rates and costly charges such as demurrage, detention, per diem, and dwell time fees on containers that may be slowed due to the congestion, according to an analysis by another transportation and logistics sector law firm, Benesch.
The weight of those combined blows means that many companies are already planning ways to minimize damage and recover quickly from the event. According to Scopelitis’ advice, mitigation measures could include: preparing for congestion on West coast ports, taking advantage of intermodal ground transportation where possible, looking for alternatives including air transport when necessary for urgent delivery, delaying shipping from East and Gulf coast ports until after the strike, and budgeting for increased freight and container fees.
Additional advice on softening the blow of a potential coastwide strike came from John Donigian, senior director of supply chain strategy at Moody’s. In a statement, he named six supply chain strategies for companies to consider: expedite certain shipments, reallocate existing inventory strategically, lock in alternative capacity with trucking and rail providers , communicate transparently with stakeholders to set realistic expectations for delivery timelines, shift sourcing to regional suppliers if possible, and utilize drop shipping to maintain sales.