Maersk underlines commitment to ESG and will seek to drive change through ‘pivotal’ supplier code of conduct, explains Dorthe Mejlvang, at IMPA London conference 2022
Maersk will continue to lead environmental change in the industry through supplier engagement and innovation, Dorthe Mejlvang told delegates at the IMPA London Conference, stating that its supplier code of conduct will play a pivotal role in engaging the wider industry.
“There’s a reason we are striving each day for a more connected, agile and sustainable future, and that’s because it’s become part of our purpose,” she said. “We want to do the right thing and we want it to be felt by as many people as possible. It’s also good business sense.”
She added that Maersk was fully committed to integrating ESG in all facets
of its supplier engagement lifecycle, and sought to work with suppliers with above average sustainability credentials.
She said further that the organisation’s supplier responsibility program, which is anchored by its supplier code of conduct, was setting those standards and helping Maersk’s tier 1 suppliers to engage with their sub-suppliers by fostering collaboration to improve ESG standards.
“It enables our customers to deliver on their sustainable supply chain commitments. So what does that mean for us? It means that we can’t make business plans with suppliers that can’t or won’t pledge to sustainability policies because our code of conduct won’t allow it.
“It also means that we need suppliers to innovate because we cannot innovate alone. We are here, we have a goal, we need to become carbon neutral by 2040; to get there we need to collaborate in the industry. So it’s extremely important that if you have something that’s new that’s different, come to us because we are willing to partner up with you and support you in any way.”
There’s a reason we are striving each day for a more connected, agile and sustainable future, and that’s because it’s become part of our purpose. We want to do the right thing and we want it to be felt by as many people as possible
As part of its holistic approach to ESG, Maersk has sought to address problems in its supply chain that it is directly responsible for. Over the course of a year, it typically supplies its vessel four times; it became apparent that this had an impact on the environment, so over the last five years it has redressed that balance, as Dorthe explained.
“Every time that we have a shipment, we will calculate the eco score for that shipment and make a comparison across vessels, which is powerful when you look across fleets. With two suppliers – Wenaas in Norway and ICM in Denmark – we have taken the entire scope of their supply to us and have calculated the eco score per individual product supplied to us and made a comparison.”
It’s powerful stuff. Dorthe explains that it tracked the route for a paintbrush that it buys from ICM which is sourced in China. They calculate the road transportation, the sea transportation, train transfer and route through Denmark to its warehouse. That creates around 2g of impact.
“It’s telling us a lot. What if I didn’t transport this paint brush from China to Denmark? Then I would of course have reduced my imprint. What that means for us is that we are willing to source closer to where we need products, to pay more for those. It’s a new approach but one that helps us a lot.”
It’s part of an overarching approach that reinforces the need to work alongside suppliers. As a leader in the industry, Maersk is expected to blaze a trail for others to follow, and it assumes that responsibility well. But within that context, it is also open to new approaches, new ways of working and new ideas. Engaging with its suppliers and industry partners remain paramount to its ambitions.
“We have taken each of the letters E, S, and G and asked where in the process does it make sense for us to be included. And for each of the core commitments we have established supporting commitments and targets and designed our strategic priorities within that area.
“Within that there is a lot of involvement for procurement because it impacts climate change a lot. It means that, especially for the governance section, our suppliers must commit to our supplier code of conduct. We need our suppliers to pledge [to improve ESG standards]. We want to be carbon neutral by 2040, and without the help of our suppliers we won’t be able to do it.”