Off the record - LSP Green Transports - Exploring differences in and monitoring of environmental demands in the purchasing process of transport services

Abstract: Effective freight transportation is a central part of the modern society, creating social and economic benefits. Nevertheless, the logistics industry is facing substantial sustainability challenges, where freight transports have been identified as the main environmental hazard. Scholars have previously highlighted the centrality of the purchasing process for reducing the environmental impact of the industry; however a limited amount of research tackles the LSP-LSC relation and the stipulated environmental demands in a detailed and practical manner, leaving the research stage highly premature. The purpose of this study is to explore the environmental demands stipulated in the purchasing process of transport services by investigating differences in characteristics of green demands emerging from two industries of LSCs, exploring how the stipulated demands affect the price of the required solutions, and examining how LSCs monitor compliance of the demands. The research questions are undertaken by a case study approach, combining analysis of corporate documentation and interviews with industrial experts. The study finds that the environmental demands vary greatly in consistency, ambition and focus between the investigated industries concluding that the food retailers demonstrate high ambition in demanding environmental considerations, while any real environmental interest among the construction materialist is limited when negatively affecting price. Furthermore, the study discovers that it is not possible to accurately distinguish how the environmental demands affect the price of the transport solutions due to the attitude of the LSP, the markets character and the conditions given the author. Concerning the monitoring process, the findings point out that LSCs monitor compliance mainly via environmental reports provided by the LSP, signifying a profound faith in the rightness of the provider. Additionally, some LSCs conduct complementary follow ups by spot-checks, assemblies and audits but strains that 100% environmental compliance is not feasible to assure.