UPS Draws from the Past to Build a Future Circular Economy

Editor's Note: This story is part of an editorial series featuring companies on CR Magazine's 20th annual 100 Best Corporate Citizens ranking, which recognizes outstanding environmental, social, and governance (ESG) disclosure and performance among the Russell 1,000 Index. You can follow the series here. 

UPS, long known for its forward-looking “Road Ahead” approach, is now investing in the circular economy. The company recently launched a new sustainability campaign called “Committed to More.” This tagline suggests a singular focus on the future. However, part of the company’s innovation strategy also involves looking backward to re-discover pathways for accelerating the emerging circular economy.

Telling the circular economy story

Underlying this reinvention of the past is a return to the ancient art of storytelling.

Sustainability reporting provides companies like UPS with new opportunities to communicate with their stakeholders and with the public. They are beginning to go beyond the facts, figures, and pie charts to include compelling narratives about facing challenges and making progress.

Last year, UPS included a storytelling format in its 16th annual sustainability report, to provide a behind-the-numbers perspective on new developments and key highlights. The company also introduced a new sustainability newsletter last year, called UPS Horizons. The newsletter format enables UPS to share news on more current basis than allowed for by annual reports.

The return of the milkman

These are not simply feel-good anecdotes. They are stories with a purpose, providing insights that can inform other businesses, advocacy groups, policymakers and individual citizens.

The inaugural issue of UPS Horizons, for example, shared research on fleet electrification. The second issue, released last February, presented the case for accelerating the circular economy by reviving the “milkman model.”

In that update, chief sales and solutions officer at UPS, Kate Gumann, wrote: “a cultural shift is changing how businesses operate—and interact with customers,” in which both the customer and the business work in concert to reduce packaging waste.

Specifically, Gutman referenced the new Loop startup, a collaborative Terracycle project that includes UPS and other industry stakeholders. The Loop service enables customers to order household supplies in attractive reusable containers, which UPS delivers and picks up in a custom-designed Loop tote.

Sustainability beyond the C-suite

The storytelling format also enables UPS to reach out to policymakers on broader issues of social concern that intersect with sustainability. Another article in the February issue of UPS Horizons deals with environmental justice in the age of climate change. It is a condensed version of a longer article from the World Resources Institute, titled “4 Ways Cities Can Build More Climate-Resilient Neighborhoods.”

In the article, WRI describes how policymakers can use its Urban Community Resilience Assessment tool to ensure that the most vulnerable areas—typically the ones most at risk economically—are included in climate resiliency planning.

WRI recently reported on a series of pilot tests for the tool in Rio de Janeiro, Brazil; Surat, India; and Semarang, Indonesia. The organization found that a strong platform of community engagement and inclusion enables planners to prioritize infrastructure based local concerns, and address other key issues including access to early warning systems and gaps in civic services. Engagement also helps planners identify and support resiliency efforts that local citizens have already undertaken.

Taking on the last mile

This kind of far-reaching engagement provides additional weight to UPS’s nuts-and-bolts work on carbon emissions. 

In addition to battery-enabled fleet electrification, UPS has been innovating with hydrogen based, zero emission transportation. UPS also understands that zero-emission is only part of the solution. In an age when all but a fraction of street vehicles still runs on gasoline and diesel, the “last mile” issue of traffic congestion is a critical one for transportation companies.

In 2017 UPS partnered with GreenBiz on a new carbon-reducing report titled, “The Road to Sustainable Urban Logistics.” That same year, the company put the report to work with a pilot test of a new “depot-to-door” delivery system. Launched in London, the project was one of a series of new urban delivery innovations from UPS. It deploys patented battery-assisted bicycle trailers to take payloads from strategically placed hubs to secondary locations. From there, the individual packages are delivered by ordinary bicycle or on foot.

The new project demonstrates how companies like UPS are increasingly forming partnerships, both within the business community and with policymakers.

In addition to bike trailers provided through the “van-free logistics” consultant Fernhay, the so named Low Impact City Logistics project included a GPS-enabled route optimization system from Skotkonung. The University of Huddersfield and the cargo bike company Outspoken Delivery were also included in the project, which was supported by part of a £10 million investment in last-mile solutions through the United Kingdom’s government-funded agency Innovate U.K.

Engaging last-mile customers in the circular economy

UPS also communicates with retailers on last-mile strategies. In 2017 the company noted that e-commerce customers are beginning to prefer alternate locations to home delivery, including neighborhood stores, coffee shops and other convenient sites.

In addition, UPS took note of the growing trend toward “ship-to-store” delivery, in which customers order goods online and pick up their order personally at a retail store. These models have been popularized by big-box stores, but UPS has also taken steps to ensure that small- and mid-sized retailers can benefit as well.

Both of these models also engage customers as partners in the delivery system—and that opens the door to expanding the circular economy through Loop-style returnable packaging systems. In this context, it is important to note that the Loop approach focuses like a laser on customer satisfaction as well as efficiency.

One important element in the Loop system is a nicely styled, compartmentalized tote—similar in concept to the old milk caddies—that each customer uses to store their “returnables” for pickup. Designed in close collaboration with UPS, the Loop tote takes recycling beyond a chore that is just steps away from taking out the trash. It elevates the consumer as an informed, active stakeholder in the circular economy.

Don’t just take our word for it. None other than Vogue Magazine profiled Loop last month as an upscale, “luxe” solution for the global plastic problem. In the article, Vogue reporter Emily Farra argued that the concept of sustainability has been wrongly intertwined with sacrificing quality. Instead, she argues for using words like timeless, resilient, durable:  “And to make something timeless or durable—whether it’s a glass bottle or a dress—you’ll inevitably select the best materials, the best craftsmen, the best technology,” she wrote.

Farra notes that the Loop tote is “better-looking and more luxurious” than typical recycling containers, “which is how you get customers to pay attention.” With its twin focus on reducing carbon and promoting the circular economy, it appears that UPS is setting the stage for a new era of aesthetics in design as well as sustainability.

Image credit: UPS