By Niklas Gustaffsson*:
Already known and committed to safety, Volvo Group was the first company to declare its environment charter at the 1972 UN Stockholm conference on environment. Today, we are signatories to the United Nations (UN) Global Compact, partner in the WWF Climate Savers programme, and supporter of the UN 2030 Agenda for Sustainable Development. Driving prosperity through transport solutions – our mission – demands that we keep in focus our entire value chain activities, the sustainable nature of our transport solutions and the way we operate as a corporate citizen.
Globally we see a clear demand emerging from customers [cities and nations included] for solutions that are sustainable, and this aspect is increasingly becoming a business case for companies. The society has serious challenges when we see the issues about resource scarcity, global warming and cities which are increasingly congested and polluted. The fifth cause of death in 2030 will be traffic accidents, passing HIV/Aids and malaria. Add to this the other alarming figures: the fuel wasted by vehicles idling while driving on congested roads in the UK alone is 747 million litres. As for air quality, only 12 percent of the city dwellers live in cities which comply with WHO air quality guideline levels. About half of the urban population being monitored is exposed to noise pollution that is at least 2.5 times higher than the WHO recommendations.
According to our analysis, the realisation of the GHG targets for 2050 will require a CO2 reduction of at least three percent on annual new fleet sales for the industry, which is a significant challenge. At Volvo Group we remain committed in this arena and there is much progress being made on how we are leading and dealing with the future of sustainable transport.
In 2007, Volvo Group displayed seven different fuels on our seven different vehicles. The message was that we can be ready with the solution, but we need directions from the Governments and authorities across the world. Fuel Efficiency of our engines has improved by 40 percent over the last two decades and Volvo Trucks today has a commitment to improve fuel efficiency by one percent each year.
We have sold over 4,000 Volvo hybrid, plug-in and electric buses around the globe commercially. Next year, we will begin selling our electric trucks too. In India we have set the agenda for public transport through our city buses across 35 cities.
We have displayed our preparedness with driverless trucks in mining, and platooning in highway trucks supporting the movement towards a more eco-efficient and safer mobility.
We concluded the ‘Super Truck’ concept project which promises to reduce fuel consumption by over 70 percent through design, lighter materials and other initiatives.
Drivers remain our focus globally and so is safety. In India we have trained over100,000 drivers. We are working towards CO2 neutral factories in Asia too and our three factories here will soon be powered by renewable energy [solar] replacing 70-80 percent of the existing power supply.
Our trucks are over 85 percent recyclable and we have a strict blacklist of materials in purchase. We have remanufacturing plants across the world to ensure re-use where possible.
We establish long-term relationships with suppliers for responsible and quality supply chain. We require our more than 40,000 direct suppliers to adhere to the principles of our Code of Conduct, which encompass business-ethical, social and environmental requirements.
Volvo Group has a clear and quantified commitment for the long-term as part of its WWF climate saver partnership programme that covers our production, products and even logistics. We already surpassed the targets we had set for 2008-2014 which included reduction of CO2 emissions from our production as well as our products’ life-time emissions.
Now we are in the middle of targets set for 2015-20. We aim to improve energy efficiency in production, by executing energy saving activities, reaching a level of 150 GWh by 2020. When it comes to products we aim to reduce total lifetime CO2 emissions from products sold between 2015 and 2020, by a cumulative saving of at least 40 Mtonne, compared to 2013 models. We have an additional area of transport logistics where we aim to reduce CO2 emissions per produced unit from the Volvo Group freight transport by 20 percent by 2020.
Collaboration Is Key
At Volvo Group we have a code of conduct that guides the way we work for every employee, besides, a clear vision and mission which is marked by a strong focus on sustainable operations. At the Volvo Group’s wholly-owned production facilities we have third-party audited quality certificates and 98 percent have environmental certificates. In India, we are on our way to powering our plants for construction equipment, trucks and buses through solar energy.
About 98 percent of the environmental impact from a truck occurs during its use. Consequently, transport solutions are one important area and therein also comes the aspect of product development. We put in a significant amount into R&D and much of its focus today is in the area of electro-mobility, automation, connectivity and alternate fuels.
We have built cooperation and research partnerships with academia and other stakeholders as well as skill development. As for India, we have an association with IISC for research in advanced automobile technology. Another example from our operations in India is the RASTA Institute where we offer industry-relevant training in road technology and post-graduate programmes. We have also trained over 100,000 drivers and operators in India and each year we conduct nation-wide competition for drivers and operators in the area of fuel efficiency.
Volvo Group has set stringent requirements for its direct suppliers in terms of environment, human rights and business ethics, and require them to pass on these requirements to the supplier chain in accordance with our Code of Conduct. As mentioned before we have 40,000 direct suppliers who need to adhere to these principles. We also collaborate with the European automotive industry through the ‘Drive Sustainability’ initiative, which was launched to develop shared global processes and requirements for the supplier chain. Volvo Group has a leading role in this collaboration, which encompasses the ten largest global vehicle manufacturers.
A key association and collaboration across stakeholders comes when we build new alternate solutions and eco-systems for future sustainable technologies. In 2016, the Group successfully demonstrated the Electricity Project which involved eight plug-in electric hybrids and three full electric buses. This was a result of a partnership with the Swedish Energy Agency, City of Gothenburg, Västtrafik, Lindholmen Science Park and Johanneberg Science Park.
When it comes to customers, the nature of our business is such that we are natural advisors in promoting solutions that are relatively more eco-efficient and set the base for a sustainable transport future. This includes high-capacity transport solutions in trucking and buses as well as setting the public transport agenda motivating more and more citizens to take public transport against their personal vehicles. Therefore, Volvo Group is today a leader in areas such as BRT, electro-mobility as well as in high capacity long-haul trucking.
Dimensions Of Sustainability
Sustainability is not merely limited to one aspect. A sustainable solution must meet the three qualifiers of environment, economic and social aspects; this is probably one area, however simple, that can be overlooked. At times, the discussion narrows down to the ‘most environment-friendly solution,’ without caring whether it will be economical or acceptable to customers and passengers.
When we go down the road of sustainable solutions, we must remember we still have various possibilities in our hands: continuous improvements in our current transport systems; significant improvements in the current systems; complete disruptions. We cannot ignore one for the other – even as we strive for an ideal situation wherein we completely break away from anything that consumes our natural resources. It’s important that we see the complete picture. Take for instance – in the attempt to go fully electric – what if we end up replacing a city congested by diesel cars by a city congested by electric cars? So, obviously even with electro-mobility – the public transport agenda, as well as transport and energy efficiency as well as passenger needs will remain important.
Handling Of Data
On 25 May 2018, the General Data Protection Regulation (GDPR) came into effect within the European Union. The purpose of this new regulation is to improve protection of individual’s right to personal integrity. It is essential to handle data in a proper way. This means not to keep data longer than necessary, and to delete it as soon as it is no longer needed or has become outdated. Personal data needs to be handled safely.
At Volvo Group, data would be present in three key categories: vehicle data, business partner data, and employee data. Data will help offer opportunities for meeting the needs of stakeholders, but these opportunities also come with a responsibility to handle the personal data with respect for personal integrity. Data privacy also helps in ensuring good relations with our customers, employees and other stakeholders. We have Data Privacy Compliance Programmes running across all functions.
Preventing Negative Impacts
Even as the sustainability challenge faces all of us, there are many new opportunities coming our way to address these challenges. The combination of new approaches to transport efficiency; electro mobility; connectivity and automation are allowing us to imagine objectives that we would not think about a decade ago. Consider the objectives of Vision Zero, Zero Emissions and Zero Downtime. These are increasingly feasible because of digital technology that allows us to turn information into proactive decisions; automation is reducing the opportunity for human errors as well as improving eco-efficiency; while connectivity is getting the entire eco-system to talk to each other as one single system. It is this capability which is helping in being able to stand up and consider the future with zero fatalities, zero emissions and zero downtime in a vehicle. At Volvo Group we are part of all these ambitions and on our way forward.
Added to this we are on the road to changing the way production takes place and products are distributed – methods and technologies – that will change the way we utilise space, cause emissions as well as the amount of resources we consume in manufacturing and distribution. Among these forthcoming technologies are a range of developments – 3D-printing, machine learning, things being on line, advanced robots, the drop of cost for batteries, self-driving vehicles, drones delivering goods, etc.
We are at the point where not only technology options are converging, but also most stakeholders. Cites are demanding sustainable solutions, nations are incentivising alternate fuels; customers and cities need to build their own image. We do believe that the world is surely converging to make sustainable development the order of the day, going forward.
(*Niklas Gustafsson is the Chief Sustainability Officer of the Volvo Group)