A deeper dive: sustainability at UPS

Or as investors call it, ESG – environmental, social and governance
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Sustainability is one of those words you hear so often but maybe don’t think about enough in terms of how it affects every human being on Earth right now.

To really understand sustainability, it’s important to realize it’s not only about the environment, but also challenges affecting society and how companies govern themselves to keep their people and our planet healthy, strong and resilient.

Environmental sustainability

“We have invested in driving down our carbon consumption, which as you can appreciate is hard for a company like UPS,” said CEO Carol B. Tomé. “Our drivers drive over two billion miles a year, we fly aircraft every day … but we are investing in carbon neutral ventures.”

UPS recently laid out environmental goals that included setting a target of 50% reduction in CO2 per package delivered for global small package by 2035.

What is CO2 and why does it need to be reduced?

Carbon dioxide, or CO2, is not inherently a bad thing as it’s a gas that occurs in nature. CO2 and other greenhouse gasses trap heat in the atmosphere. Some naturally occurring CO2 is necessary to keep the planet warm enough to support life. However, all the additional CO2 added to the atmosphere from burning fossil fuels is trapping extra heat.

And trapped heat warms the planet.

Using fossil fuels – coal, oil and gas – releases CO2 into the atmosphere.

It’s a reason, for example, several western U.S. states broke daily record-high temperatures this year. On July 9, 2021, Death Valley, California reached 130 F / 54.4 C, only four degrees Fahrenheit and two degrees Celsius below the world record high.

So, to reach that 50% reduction, UPS announced it will achieve a few key milestones by 2025, including:

  • 40% alternative fuel of total ground fuel.
  • 25% renewable electricity for facilities (100% by 2035).

These milestones are set to help UPS reach the overall goal of being carbon neutral by 2050. Basically, this means that all UPS’s actions that release emissions are becoming cleaner and more efficient every day.

The fleet:
UPS recently committed to purchasing the equivalent of 250 million gallons of RNG, or renewable natural gas, making it the largest consumer of RNG in the transportation industry.

This matters because compared to conventional diesel fuel, RNG releases 90% less of those above-mentioned greenhouse gasses.

UPS has invested more than $1 billion in alternative fuel like this, as well as advanced technology vehicles and fueling stations. To date, UPS owns one of the largest fleets of advanced technology vehicles globally.

Future plans include the deployment of 10,000 all-electric Arrival delivery vehicles in North America and Europe. 

The facilities:
To measure sustainable construction around the world, the most widely used rating system is LEED (Leadership in Energy and Environmental Design).

UPS currently has 18 facilities that have received a green-building certification like this including our headquarters building. And the company is investing in cutting-edge technology to handle heightened package volumes from ecommerce more efficiently than ever.

Green technology includes light emitting diode (LED) lighting in facilities. With LED, an electrical current passes through a microchip, making it 90% more efficient than incandescent lighting. It also significantly reduces the amount of wasted heat that is released, making LED ideal for warm climates.

Other examples include a UPS facility in Paris that collects rainwater used to wash vehicles, and a building in Visalia, California equipped with a solar power roof that will help make it a near-zero carbon facility.

Social sustainability

With more than half a million employees and millions of customers in communities around the world, UPS is in a position to truly move our world forward by delivering what matters. 

For example, UPSers are planting trees and ensuring equitable access to vaccines to be socially sustainable.

Planting trees will make a difference beyond the environmental front. Studies show residents in low-income neighborhoods have lower levels of tree coverage, leading to increased risk of extreme heat and asthma and a lower life expectancy (up to 13 years) compared to higher income neighborhoods. UPS continues to dig in on our goal to plant 50 million trees around the world by 2030, which will help absorb carbon from the atmosphere and remove chemical air pollution.

And, as the COVID-19 pandemic continues, UPSers around the world prove once again how essential they are, delivering vaccines, healthcare products and household goods, and advancing equitable vaccine distribution though the UPS Foundation and UPS Healthcare. Through The UPS Foundation, for example, we:

“We are interdependent as a global community – no one is safe until everyone is safe,” said Nikki Clifton, president of The UPS Foundation. “Now is the time to link our arms around the world. Now is the time to deliver vaccines – and hope – to everyone, regardless of wealth or location.”

Corporate governance

UPS remains committed to a transparent and inclusive corporate governance structure. But what does that really mean?

Governance is how UPS is held responsible for managing our business ethically and advancing our environmental and social initiatives. This covers all activities and company policies governing our Board of Directors, management teams and employees. 

Keeping with our purpose and mindful of the ESG issues that matter most to our customers, suppliers and employees, we’ve recently made key changes to our governance:

  • Created the Equity, Justice & Action task force to ensure a more equitable and just UPS.
  • Conducted an independent pay equity audit to ensure an environment of transparency and equitable opportunity.
  • Added five new directors, increasing board diversity with respect to gender and ethnicity.
  • Appointed a chief diversity, equity and inclusion officer, and elevated the role of chief sustainability officer, both becoming part of our Executive Leadership Team.

As Carol has said, “We are investing in a better world because it's part of taking care of the needs of all stakeholders … I believe it to my core it's our responsibility.”

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