Air Freight & Logistics

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Current language: English
Air Freight & Logistics industry entities provide freight services and transportation logistics to both businesses and individuals. The industry consists of three main segments: air freight transportation, post and courier services, and transportation logistics services. Entities in the industry earn revenue from one or more of the segments and range from non-asset-based to asset-heavy. Transportation logistics services include contracting with road, rail, marine and air freight entities to select and hire appropriate transportation. Services also may include customs brokerage, distribution management, vendor consolidation, cargo insurance, purchase order management and customised logistics information. The industry is crucial to global trade, granting it a degree of demand stability.

Relevant Issues (6 of 26)

Why are some issues greyed out? The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.
  • Environment
    • GHG Emissions The category addresses direct (Scope 1) greenhouse gas (GHG) emissions that a company generates through its operations. This includes GHG emissions from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes), whether a result of combustion of fuel or non-combusted direct releases during activities such as natural resource extraction, power generation, land use, or biogenic processes. The category further includes management of regulatory risks, environmental compliance, and reputational risks and opportunities, as they related to direct GHG emissions. The seven GHGs covered under the Kyoto Protocol are included within the category—carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3).
    • Air Quality The category addresses management of air quality impacts resulting from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes) as well as industrial emissions. Relevant airborne pollutants include, but are not limited to, oxides of nitrogen (NOx), oxides of sulfur (SOx), volatile organic compounds (VOCs), heavy metals, particulate matter, and chlorofluorocarbons. The category does not include GHG emissions, which are addressed in a separate category.
    • Energy Management
    • Water & Wastewater Management
    • Waste & Hazardous Materials Management
    • Ecological Impacts
  • Social Capital
    • Human Rights & Community Relations
    • Customer Privacy
    • Data Security
    • Access & Affordability
    • Product Quality & Safety
    • Customer Welfare
    • Selling Practices & Product Labeling
  • Human Capital
    • Labor Practices The category addresses the company’s ability to uphold commonly accepted labor standards in the workplace, including compliance with labor laws and internationally accepted norms and standards. This includes, but is not limited to, ensuring basic human rights related to child labor, forced or bonded labor, exploitative labor, fair wages and overtime pay, and other basic workers' rights. It also includes minimum wage policies and provision of benefits, which may influence how a workforce is attracted, retained, and motivated. The category further addresses a company’s relationship with organized labor and freedom of association.
    • Employee Health & Safety The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
    • Employee Engagement, Diversity & Inclusion
  • Business Model and Innovation
    • Product Design & Lifecycle Management
    • Business Model Resilience
    • Supply Chain Management The category addresses management of environmental, social, and governance (ESG) risks within a company’s supply chain. It addresses issues associated with environmental and social externalities created by suppliers through their operational activities. Such issues include, but are not limited to, environmental responsibility, human rights, labor practices, and ethics and corruption. Management may involve screening, selection, monitoring, and engagement with suppliers on their environmental and social impacts. The category does not address the impacts of external factors – such as climate change and other environmental and social factors – on suppliers’ operations and/or on the availability and pricing of key resources, which is covered in a separate category.
    • Materials Sourcing & Efficiency
    • Physical Impacts of Climate Change
  • Leadership and Governance
    • Business Ethics
    • Competitive Behavior
    • Management of the Legal & Regulatory Environment
    • Critical Incident Risk Management The category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
    • Systemic Risk Management

Disclosure Topics

What is the relationship between General Issue Category and Disclosure Topics? The General Issue Category is an industry-agnostic version of the Disclosure Topics that appear in each SASB Standard. Disclosure topics represent the industry-specific impacts of General Issue Categories. The industry-specific Disclosure Topics ensure each SASB Standard is tailored to the industry, while the General Issue Categories enable comparability across industries. For example, Health & Nutrition is a disclosure topic in the Non-Alcoholic Beverages industry, representing an industry-specific measure of the general issue of Customer Welfare. The issue of Customer Welfare, however, manifests as the Counterfeit Drugs disclosure topic in the Biotechnology & Pharmaceuticals industry.
General Issue Category
(Industry agnostic)

Disclosure Topics (Industry specific) for: Air Freight & Logistics

GHG Emissions
  • Greenhouse Gas Emissions

    Air Freight & Logistics industry entities generate direct greenhouse gas (GHG) emissions that contribute to climate change. Emissions are generated from fuel combustion by both air and road freight operations. Given the altitude of the emissions from jet fuel, air freight makes an especially potent contribution to climate change. Management of GHG emissions is likely to affect air freight and logistics entities’ cost structure over time because emissions are tied directly to fuel use, and thus to operating expenses. Fuel efficiency and alternative fuels usage may reduce fuel costs or limit exposure to volatile fuel pricing, future regulatory costs and other consequences of GHG emissions. While newer aircraft and trucks are generally more fuel efficient, existing fleets may be retrofitted. Capital investments in more fuel-efficient aeroplanes or vehicles and emerging fuel-management technology may reduce fuel expenses and improve profitability. These investments also may help entities capture market share of customers seeking low-carbon shipping solutions.
Air Quality
  • Air Quality

    Entities in the Air Freight & Logistics industry generate air pollutants that may threaten human health. The industry’s primary air emissions include sulphur oxides (SO?), nitrogen oxides (NO?), and particulate matter (PM), which have localised negative effects on air quality. As regulators debate the most efficient mechanisms to reduce local air pollution from the industry, entities may be forced to increase operating costs or make investments to modernise their fleets due to regulatory pressure, customer demand, and rising fuel costs. Use of more expensive alternative fuels and mechanisms that filter emissions prior to release into atmosphere can also impact an entity’s cost structure, requiring upfront costs but decreasing exposure to regulation over the long term.
Labor Practices
  • Labour Practices

    The Air Freight & Logistic industry’s reliance on independent contractors, mainly for courier driving, has come under increasing regulatory scrutiny. Independent contractors may not be not covered under the same laws that protect employees, and entities may face regulatory sanctions for misclassifying employees as independent contractors. Entities may also face legal actions from employee and contractor claims regarding wage payments, benefits, and working conditions. This may also negatively affect their reputation and ability to hire and retain employees, reducing operational efficiency and increasing turnover costs.
Employee Health & Safety
  • Employee Health & Safety

    Employees in the Air Freight & Logistics industry may be exposed to dangerous working conditions, including accidents resulting from mechanical failure or human error. Additionally, moving packages manually is a physical process that requires special training in order to minimise injury. While the fatal occupational injury rate for trucking workers is higher than average, worker safety issues in aviation are highly regulated, which raises the risk of fines or penalties when an incident occurs. Health and safety incidents may result in work stoppages and a range of costs, from medical expenses to workers compensation. Such incidents can also reduce productivity, and thus revenues, if employees believe their safety and well-being are not being prioritised. Finally, entities with poor safety records may also face increased insurance premiums and higher costs of capital, as well as reputational damage that could reduce revenue and market share. An entity can mitigate these impacts by providing adequate protection and training for employees, ensuring mechanical equipment is safely functioning, and establishing a culture of safety within the workplace.
Supply Chain Management
  • Supply Chain Management

    Many entities in the Air Freight & Logistics industry contract with large, complex networks of asset-based third-party providers to provide freight transportation services to their customers. Contracting is common among entities providing freight forwarding, logistics, brokerage and intermodal services. Contractors range across all modes of transport such as motor carriers, railroads, air freight and ocean carriers. Entities must manage contractor relationships to ensure contractor actions that may have environmental or social impacts do not result in material adverse effects on their own operations, such as decreased brand value. At the same time, entities that offer low-carbon logistics solutions may capture market share from customers seeking to reduce the carbon footprint of their shipment.
Critical Incident Risk Management
  • Accident & Safety Management

    All modes of transportation pose safety risks. In some cases, mechanical failure or human error may lead to accidents with significant environmental or social consequences, including regulatory action and lawsuits from impacted communities or customers. While the stringency of regulatory requirements may vary by the region of operation, entities that maintain the highest safety standards throughout their global operations can minimise the risks of safety incidents that affect their reputation and profitability.

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Current Industry: Air Freight & Logistics

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