The global shipping industry's annual greenhouse gas emissions total more than 1 billion tons and account for about 2% of global CO2 emissions. Director of International Logistics and Decarbonisation, Sundarrajan Bhyravan explains how reducing shipping emissions is good for business and planet.
At Unilever, our Climate Transition Action Plan (PDF 10.15 MB) sets out the steps we’re taking to reach our climate targets, including halving the emissions impact of our products per consumer use by 2030 against a 2010 baseline, and reaching net zero across our value chain by 2039.
In a series of interviews, we put the spotlight on some of the people who are helping to deliver our action plan and make change happen.
Logistics Director Sundarrajan Bhyravan helps manage Unilever’s global ocean and air movements. From a virtual control tower that allows us to monitor shipping emissions in real time to our work with partners and policy-makers to effect wider system change, he explains the work we are doing to make our shipping more sustainable.
What does your role involve?
A big part of my role involves design and execution of Unilever’s international ocean logistics network. We move around 150,000 containers a year, so at any point in time there are around 10,000 containers in the sea. We need to look at the execution of those shipments – are there any delays? How are we doing on cost? Are we improving efficiency? The focus here is on the day-to-day aspects of cost and service and how we are tracking everything.
I’m also working on our Virtual Ocean Control Tower, which we launched in 2021. This is a centrally managed system that anchors and executes all our ocean and air movements. It’s moving us towards a model where one lead logistics provider uses a centralised system to manage all our global movements.
Finally, I manage the decarbonisation of our ocean logistics. We’re establishing where we are in terms of our ocean emissions now and how we can reduce our climate impact. Our initial measures have focused on improving efficiencies, lowering the number of containers we are using and reducing the energy requirements and the waiting time of those containers. Beyond that, we will focus on transformation, exploring next-generation vessels and next-generation fuels.
Why is tackling shipping emissions important?
If you measure global ocean emissions in their entirety, it equates to the sixth biggest country’s emissions, so it’s the same as the total emissions of Germany. Shipping is also a slow starter when it comes to climate action – there were no emissions standards for fuel until the end of 2019 when the International Maritime Organization put limits on sulphur use. So the industry has some catching up to do.
For Unilever, ocean shipments account for a very small share of our logistics emissions, which in turn account for just 3% of our overall emissions. But climate change is a problem for everyone and if big companies like us, as cargo owners and shippers, don’t take a lead, then who will?
What practical steps are we taking to cut our shipping emissions?
We aim to reduce our shipping emissions by 40% by 2029 against a 2020 baseline and then to reach net zero emissions by 2039. As I said, the quick wins are about efficiency – what’s the optimum type of container? How can we ensure they are full when travelling? How can we reduce the distance travelled? After that, it’s about making sure we’re using the right vessels. We’re measuring carrier emissions at trade corridor level and have also started using emission efficiency as one of the criteria to nominate carriers during our tender processes.
These are our low-hanging fruit and will help to reach our 40% target, but they won’t take us to net zero by 2039. That’s why we’re also exploring next-generation vessels and alternative fuels. But the shipping industry is in flex on this. For example, only some carriers have opted for incremental steps using biofuels, an energy source from living matter; better than oil but as a standalone action it doesn’t move the needle enough, even when sustainably sourced from local markets. So, we see this as an interim solution.
Other carriers have taken the decision to transform straight to net zero emissions, so they’re working on methanol, ammonia and hydrogen-based solutions. But these are all evolving technologies and nothing has yet been established in a scalable way.
There is also the upstream production of these fuels to be considered. We’re working towards a complete ‘well to wake’ end-to-end model, so even if a fuel is considered clean, where is it produced and how? What emissions are created in the process? Currently, there is not enough clarity on zero emission fuels, but more industry trials will happen in the next few years, and we will be monitoring these closely.
How is our virtual ocean control tower helping to reduce our emissions and costs?
Our virtual control tower connects directly with ocean carriers, satellite data providers who track and trace shipments, and companies providing information on external threats and risk events, to form a digital infrastructure that allows us to monitor our shipments in real time. At its launch in 2021, we used the system to set up automated notifications to let people know of challenges and delays, saving employee time and improving productivity. Then, in 2022, we began to use the system to take real-time CO2 measurements.
We know the vessel being used for each shipment, we know the distance it has travelled, and we know what type of container we’re using, along with the per unit emission of the carriers. So as soon as the container completes its journey, the emissions are automatically calculated and added to our tracker. We can slice this data by shipping lane, by carrier, by market, by importers, to see where we’re doing well and where we’re not. It gives visibility of our emissions at a granular level, helping us understand where to act.
We found that we were not filling our containers efficiently. The tower has helped us address both emissions and efficiency, through an automated alert system, flagging when capacity was below 60%, and providing data on the financial and CO2 impact of this, offering a compelling business case to find solutions.
So far, the virtual control tower system has helped us to deliver savings at the rate of 25% of our spend. It also helped us reduce emissions from our shipments by approximately 15% in 2022. We’re now gathering data on sea temperature to help us optimise use of temperature-controlled containers, and we’re looking at route efficiencies – using the data collected to test and prove various hypotheses.
How are we using our influence to push for wider system change?
We’re part of Cargo Owners for Zero Emission Vessels (coZEV). This network brings together various shippers who have pledged to only purchase ocean freight services powered by scalable zero-carbon fuels by 2040, so we can discuss what’s happening in the industry, what we can do in our own sphere and how we can influence wider policy.
When law-makers agreed to the first green shipping fuel requirement in 2022, we were one of 50 industry organisations who had been calling for the EU to raise its green hydrogen mandate for shipping from 2% to at least 6% by 2035. We are also connected to the Global Maritime Forum which looks at public policy and engagement, and Aspen Institute working groups on maritime decarbonisation.
This is where, as a cargo owner, we play a big role. A shipper like us taking an objective view of what is good for the planet, supporting the right initiatives through our long-term supplier partnerships and our public policy engagement will show we are serious about decarbonisation.
So although Unilever is only a drop in this big ocean, our drop matters because it can help drive change. One of my favourite quotations is from Gandhi – “be the change you want to see”. The shipping industry can feel complex, but my view is that alongside other big companies, we must try to make a difference by doing what we can under our own control, sending out a demand signal for cleaner fuel. Change may happen slowly and we may have some failures, but if we keep going, we will ultimately get where we need to be.