Kuehne + Nagel International : Sustainability Report 2020 (PDF)

2020 Edition

Sustainability Report

Contents

1. Welcome message/CEO message
2. About this report
3. Driving a sustainable business

1. Our business
2. Embracing sustainability
3. Mitigating risks

7 Ensuring compliance

1. Fostering sustainability in the industry
2. Driving our Net Zero Carbon programme

1. Building viable partnerships
2. Caring for water consumption and waste reduction

1. Exploring renewable energies and energy efficiency

1. Measuring sustainability progress
2. Assessing stakeholder engagement (materiality matrix)

1. Stakeholder engagement and dialogue

1. Strengthening anti-bribery,anti-corruption and antitrust awareness
2. Confidential reporting and allegation management
3. Safeguarding data via information security
4. Evaluation of high risk third parties
5. Preserving security
6. Proper handling of goods
7. Fostering health and safety

1. Enforcing human rights

1. Protecting labour rights
2. Assimilating diversity and inclusion

1. Ensuring business continuity and disaster response
2. Executing responsible tax management

50 Community engagement

52 Performance data

52 Explanation of performance data for 2020

55 GRI index

63 UN Global Compact index 2020

Welcome message

Dear readers,

When we look back on the year 2020, sustainability might not be the first thought that comes to our minds. The global pandemic has challenged economies, society, and each and every one of us unlike anything we have experienced before. Despite this, I am convinced that the past year has made the importance of creating and incorporating a culture of sustainability

• The global pandemic has shaken up the world - but above all it has emphasised the urgency for sustainable behaviour and actions."

even clearer.

A crisis of this magnitude requires politics, the economy and society, to rethink the structures they live by, to adapt them and ultimately to make them so agile that future crisis situations can be better responded to or even be avoided. And that is precisely what sustainable action is in its truest sense: the responsible, forward-looking use of our resources and knowhow.

In economics, this aspect is often called resilience. In logistics specifically, it refers to designing and managing global supply chains that adapt to volatility of demand or markets in general - a topic which has been on the agenda of logistics experts long before the world was hit by the coronavirus.

For us at Kuehne+Nagel, resilience is an important part of creating economic sustainability for employees, customers and business partners. In 2020, this approach has proven successful in many ways: With a robust IT infrastructure enabling global web-based interactions and solid contingency management we were able to provide safe workplaces and remote working options while at all times maintaining our customer promise and safeguarding the wellbeing of our workforce. Agile processes and well-established networks

have given us the flexibility to deliver goods whenever and whereever needed.

At the same time, our focus on sustainability was unwavering. Committed to the Science-Based Target initiative and as part of our Net Zero Carbon programme we became fully carbon neutral for our own emissions in 2020, one of the first in our industry. We were also the first logistics provider to offer an integrated CO2 neutral LCL solution for all shipments in our global LCL network.

In line with our global renewable energy strategy we continuously reduce our CO2 footprint in our offices and warehouses while exploring the use of alternative energies for sea, air and road logistics together with manufacturers, suppliers and customers. Expanding our sustainable solutions offering in all areas of our service offering is part of our ambitious target

of carbon neutrality for our suppliers and customers by 2030.

When it comes to social sustainability, it is our primary goal to create a sustainable and resilient organisation for the future. With our Global Diversity and Inclusion policy, set into action with our Balance and Belonging programme, we underline the organisation's commitment to build a culture where everyone feels they belong and has equitable opportunities.

Kuehne+Nagel is fully committed to the UN Global Compact and the UN Sustainable Development Goals underlining the ten principles of Human Rights, Labour, Environment and Anti-Corruption. This Sustainability Report (Communication on Progress, COP) outlines the integration of our actions in our business strategy, operations and behaviours. This information is publicly available.

Sustainability is the foundation to everything we do as an organisation. During the year 2020, for all its challenges, we were able to prove that. We take comfort in the achievements made and look to create more value for all our stake- holders.

As Kuehne+Nagel, we recognise our place in the world, but we are aware we do not act alone. We are part of a global ecosys- tem. We do our part and encourage our peers, partners and stakeholders to do the same. Therefore, sustainability is both a collaborative endeavour and a task for each of us individually.

Join in, and together, let us create a sustainable future for all of us.

Dr. Detlef Trefzger

CEO

4	About this report

About this report GRI 102-10

This report covers Kuehne+Nagel's global operations including activities occurring at all of our facilities, owned and leased, over which we have operational control unless otherwise noted. The scope

of health and safety reporting includes facilities and operations over which Kuehne+Nagel has management control, including warehouses and offices.

Also acknowledged in this report are Kuehne+Nagel's sustainability activities and performances for the calendar year 2020 (see page 52 and ff.). For more details please visit our Annual Report 2020, page 11.

Throughout the report, some historic data and information have been included to provide context and to illustrate performance trends. The Global Reporting Initiative (GRI) Index at the end of this report makes reference to the GRI Core standards fulfilled by Kuehne+Nagel.

In this report, for the first time, Kuehne+Nagel will include reporting on UN Global Compact (UNGC) 10 principles. Our Sustainability Report is our annual Communication on Progress report (COP) to the UN Global Compact, and it incorporates information on our sustainability

activities according to the UN Global Compact Active Level criteria.

Kuehne+Nagel seeks external assurance of its direct greenhouse gas emissions (scope 1), indirect greenhouse gas emissions (scope 2), energy consumption and production, waste generation and water consumption from our company-owned sites.

In 2020, Kuehne+Nagel has decided to work with a new certification body. The external assurance, validation and certification were granted by Det Nor- ske Veritas (DNV). Environmental data presented in this report have changed from prior disclosures due to changes of business operations, including mergers and acquisitions that concluded during the reporting year.

Other Group reporting that may be of interest to readers is available on our website under Annual Report 2020 as follows:

• 2020 Building Bridges
• Corporate Governance
• Remuneration Report
• Status Report
• Financial Report

Driving a sustainable business

Our business

Kuehne+Nagel Group strives on a daily basis to connect people and goods through innovative and sustainable business solutions. Through the integrated management approach we are adding value to our external and internal custo- mers; contributing to their success in

Integrated management system

Driving a sustainable business

5

managing business risks and increasing efficiency. The diagram below presents the Kuehne+Nagel Business Unit and Functional Unit Process map, supported by Kuehne+Nagel's integrated management system.

Integrated Management System

	Leadership governance
	Strategy, supplier management, KPIs,
	risk management, improvement, etc.
	Sea Logistics
Customer	Air Logistics	Customer
requirements		satisfaction
(needs and	Core product & services	(results and
expectations)	improvements)

Road Logistics

Contract +

Integrated Logistics

Support governance

(Information Technology, Human Resources,

Finance, QSHE, Sales & Marketing, Legal,

Compliance)