The transportation and logistics industry is being targeted for environmental improvement and sustainable financing through a new collaboration between a certification organisation focused on green logistics and a fintech company specialising in environmental, social and governance (ESG) issues.
As part of a new partnership announced this week, the green logistics certification body Green Freight Asia (GFA) Network and the ESG fintech firm Hashstacs (STACS) are together aiming to provide sustainable credibility to the freight, transportation and logistics industry in the Asia-Pacific (APAC) region.
The partnership hopes to achieve this through the consolidation and aggregation of transportation and logistics certifications, namely through STACS’s digital registry, ESGpedia.
STACS’s digital registry compiles data on sustainability metrics such as fuel consumption, carbon emissions and carbon intensity alongside analytical tools for benchmarking against industry standards and assessing carbon savings.
These features allow companies to monitor their sustainability performance and track their carbon footprint with greater transparency. It also powers the Monetary Authority of Singapore’s (MAS) Greenprint ESG Registry.
ESGpedia meets Green Freight Asia
The partnership’s bread and butter is the coming together of STACS’s aforementioned ESGpedia registry with GFA’s labelling and certification programme.
The programme certifies companies that correctly demonstrate a commitment to and progress toward the adoption of green freight practices.
The GFA label acts as an external validation of a company’s commitment to sustainability in the logistics sector. The four rankings for carriers and shippers include minimum, enhanced, strong and outstanding (Leaf one to Leaf four).
Through the partnership, businesses which have attained the GFA certificate will now be able to choose to create a company ESG profile on ESGpedia for free, where they can upload and showcase their various sustainability efforts, as well as better track their emission targets with ready digital tools.
Financial institutions can also access this data and use it to develop greener capital financing solutions that can help in the formulation of data-driven emission reduction strategies. Banks can also engage in positive screening of green logistics businesses that meet their ESG credential criteria, to engage in ESG financing.
This functionality is especially key as the transportation sector is one of the largest contributors to greenhouse gas emissions, accounting for 15 per cent of Singapore’s carbon emissions, and is also highly susceptible to global climate risks and disruptive shocks.
Because of this, the government in Singapore has also announced its commitment to achieving an 80 per cent reduction in carbon emissions for the sector by 2023.
A new turn for ESG in Singapore
Speaking on the Network’s ambition to improve the sustainability performance of the freight, transport and logistics industry in the APAC region, Krishan Kumar Ralhan, director and CEO at GFA, explains how the move will “equip companies in the logistics sector with data digitisation tools to achieve net-zero emissions by 2050.”
Benjamin Soh, managing director at STACS, adds: “The future we envision for Asia’s transport and logistics industry is one that leverages technology and quality data to spearhead sustainability and achieve its decarbonisation goals.”
“With an increasing regulatory push, there is a dire need for businesses in the sector to build resilience in today’s climate,” continues Soh.
“Our partnership with GFA is highly strategic, combining GFA’s certification programme for the logistics sector with enhanced visibility, better data and emissions tracking on STACS’s ESGpedia registry.
“With green capital being a key enabler in businesses’ transition, ESGpedia also enhances sustainable financing opportunities for GFA-certified companies on the registry,” he concludes.
This latest partnership marks further developments in ESGpedia’s transport and logistics coverage, following STACS’s live use case with Singlife with Aviva and CO2 Connect earlier last year, whereby Singlife leveraged CO2X’s logistics carbon emissions tracking capabilities and data on ESGpedia registry (obtained with consent from insurance policyholders) to efficiently develop and better structure new green motor insurance policies.