Jessica Balsam, Sustainability Director, APL logistics
APL Logistics (APLL) is a $1.7 billion third-party logistics provider that manages the coordination and contracts between companies that produce products and the transportation providers needed to distribute those products around the world. With more than 120 offices and logistics facilities in more than 60 countries, APLL operates over 20 million square feet globally to serve the automotive, consumer, industrials, and retail verticals. APLL’s primary focus is ensuring that the right product arrives at the right place at the right time.
What do you actually do all day?
My role is to direct the development of our company’s strategy around sustainability so that it’s supportive of the sustainability goals of our customers. Many of our customers are leaders in sustainability and have begun asking the vendors in their supply chains to improve the sustainability of their operations and increase transparency and reporting of sustainability metrics. These customers have been working for years on understanding and reducing their scope 1 and scope 2 greenhouse gas emissions, and now they’re beginning to really focus on scope 3. As the relationship manager between our customers and their transportation providers, we need to ensure we have the capability to provide them with the data they need and to help them work with providers that are operating as sustainably as possible.
This is a new initiative at APLL so I spend a lot of time meeting with internal teams to help them understand why sustainability needs to become a core part of our business and how it ties in to our customers’ brands and investor valuations. It’s incredibly eye-opening when people learn just how much our customers care about managing and reporting the emissions from their supply chain operations, and how much that can impact the value of their brand or the confidence of their investor community.
I’m also developing our own internal sustainability goals as well as a road map for achieving them. They’ll be based around efficiency, equity, and innovation. There will be an energy efficiency component as well as projects focused on reducing our carbon emissions and increasing our recycling of packaging. In addition to the more traditional sustainability work, I’m in charge of maintaining our nonprofit partnerships that utilize our expertise in logistics to help local charities.
One very important partnership that I am a part of is the Clean Cargo Working Group, which is a sub-group of Business for Social Responsibility (BSR). We are working together to make it easier for carriers to disclose their carbon data to companies like APLL so that we can compile it and provide it to our customers. It’s a small but very productive group.
I’m also partnering with The Sustainability Consortium and the Ellen MacArthur Foundation to work on a long-term project that could help us measure the life cycle of clothing from the point of sale to a customer’s determined end of life. I wish I could tell you more about it, but that’s all I can share for now.
Another important project I’m working on with our partners is developing a concept called demand sensing. The goal is to help our customers better understand near term future customer demand. For example, if there’s a social media explosion around a pair of jeans that Kylie Jenner wore, everyone in that teenage girl demographic is going to be demanding those jeans. We want to help supply chains recognize that demand and step up distribution quickly. From a sustainability perspective, it’s really important that we use our technology to help companies right-size their inventory. That helps reduce the emissions associated with unsold product and lower overall cost. There was a lot of media coverage recently about one retailer with a large amount of inventory that hasn’t sold through and I think it really highlights the importance of getting demand planning right.
I have to keep an eye on global environmental policy as well, there are some huge policy shifts coming. For example, there’s now a national carbon market in China, Florida Representative Carlos Curbelo introduced a carbon tax bill, and the International Maritime Organization (IMO), which is a UN body, is working to reduce sulfur in shipping fuel and cut all emissions from global shipping 50% by 2050. Sulfur is a component in fuel for major cargo ships that has especially negative environmental impacts. There’s currently a limit of 3.5% sulfur content in fuel, but IMO is looking to reduce that to 0.5% by 2020. While that’s fantastic for the environment, it will result in price increases over time, so I want to be sure customers are planning for this shift.
I also make sure I keep up on how the investor community looks at sustainability. Morgan Stanley did a report in 2016 that 1 in 6 US dollars are invested in sustainability and 63% of fortune 100 companies have climate focused sustainability goals and are beginning to push their vendors to support those goals. There’s a group called the Climate Action 100 which is close to 300 investors in 90 countries who control $30 trillion of invested capital. They’re collectively pushing for companies to disclose their risk to climate change in their actual financial reports in addition to their sustainability reports. The way that companies move their product has a huge impact on their environmental footprint, and if companies are forced to disclose that impact, it could be a big financial issue, especially for the big brands.
What are some of the key skills for success in this role?
You have to know a little about a lot. Sustainability is unique in a lot of ways because you have to understand how to analyze data, pull out valuable insights, and then be able communicate effectively about it. You’re a one-stop shop. Also, most people in marketing or finance don’t spend a significant amount of time trying to convince people that there is value in their profession but many in sustainability are still doing just that, so communication skills are essential. Continuing along that theme, public speaking and the ability to communicate to multiple stakeholders is important. You’ve got to be good at taking a complex concept and explaining it as simply as possible to many different people.
What is your favorite part of your job?
Working on sustainability issues within a large business is wonderful. I’ve worked in government and for nonprofits and while that’s important work, I feel that capitalism is the single greatest tool we have at our disposal to end human suffering. I really like the business side of sustainability.
What is the hardest part of your job?
We’re still working to move people from this outdated idea of sustainability as a separate thing or a charitable act instead of it being deeply integrated into the business or as a large potential revenue generator or differentiator for being selected by customers. I’m fortunate that I have a lot of internal support, but the industry still has a lot of perception challenges.
What is your proudest professional achievement?
When I was at Nike I worked on a great circular economy project with the Ellen MacArthur Foundation. It was called Bag2Better and it was focused on increasing the recycling of polybags in the back of house at the US retail stores. The plastic was consolidated and taken to a facility in California that manufactures the famous orange polyurethane Nike shopping bags. Currently, about 10% of those orange bags come from recycled polyurethane plastic.
What are the game changers in your world?
Investors and investment banks need to continue to be very vocal about the need for sustainability information. If they would explicitly include it in their stock price evaluations, that would help motivate the businesses focused on cost as well as provide an opportunity for publicly traded companies to think about long-term profits and success.
More investments in our national labs to drive innovation around renewable or sustainable fuel would be incredible. In some cases, better fuel alternatives are simply not available, so as much innovation as possible would be huge.
We also need more data from our transportation providers. There’s interest from the industry in using blockchain technology for tracking carbon data. This would be big as typically an individual SKU goes through dozens of handlers to arrive at the consumer point of sale. It’s critical if we’re going to be able to consider our data accurate.
What was your path to this role?
It was definitely unplanned. I earned my MBA with a focus on sustainability. Then I worked for the US Department of Energy in the Office of Efficiency and Renewable Energy for five years. I learned a lot there but I wanted to make a more direct impact so I went to work for Nike for a few years. At Nike I learned a lot about what it takes to move a huge company towards understanding and implementing sustainability. It requires constant education around what sustainability is and what it means to the company. While at Nike I also did some volunteer work at Social Venture Partners which invests professional volunteer hours and money to help exponentially increase the impact of nonprofits. When I was looking for my next challenge, APLL was looking for someone to start this new program. Nike is an important partner of APLL, so it was a natural fit.
What’s your advice to someone interested in a role like this?
It’s important to develop a good understanding of hard power and soft power. You need to be able to understand the hidden structure of a company and how to influence people instead of trying to force them to do things.
What are your favorite resources?
Business for Social Responsibility’s Clean Cargo Working Group
The Ellen MacArthur Foundation
Twitter (you can follow me at @MoveSustainably!)
The big news sites have good coverage, too. I keep up to date with news from The New York Times, Financial Times, Politico, NPR, The Wall Street Journal, and The Washington Post – so much of sustainability is still being developed, it’s important to understand how global events will shape the future of the industry.
Who (or what) is your sustainability hero?
My late father, John Balsam, is the reason I work in sustainability. When I was growing up, he worked for the National Center for Appropriate Technology and collaborated with inventors of clean energy technologies to commercialize their products. I have vivid memories of being told to put on a sweatshirt rather than turning up the heat, watching solar panels get installed on his office building, and learning to optimize the dishwasher’s capacity (i.e. getting as many dishes in as possible, even it meant rearranging them three or four times.)
