Companies are increasingly focused on reducing supply chain emissions, including emissions from transport and logistics (see info box).1, 2, 3, 4 However, some companies also struggle to translate emissions reduction targets into action, or to understand which initiatives to prioritize and how to secure financial resources to support this work.5, 6

This article highlights insights from a new framework mapping eight key levers of challenge and opportunity for freight customers decarbonizing their shipping and logistics operations.12 The framework has been developed by the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (MMMCZCS) through independent research and stakeholder interviews. Our research highlights the multifaceted nature of the challenges that these companies face, as well as the nuances of the levers needed to reduce emissions from shipping and logistics.

By sharing findings from this MMMCZCS project, we aim to inspire freight customers in their own independent efforts to drive decarbonization forward – no matter if they are already leading the way or just beginning to explore how to track, manage, and reduce emissions from freight and logistics. The levers set out in our framework offer a practical structure that any freight customer or those working with them can use to define or further refine their decarbonization strategies and activities.

Our analysis at the MMMCZCS identified eight key levers of challenge and opportunity that freight customers can benefit from addressing as they seek to decarbonize their shipping and logistics operations. Our full ‘Freight customer framework for decarbonizing shipping and logistics’ offers a more detailed overview of the eight levers, along with specific examples and potential solutions drawn from our research and interviews.13

Overview of the eight keys levers of challenge and opportunity in the framework

While the framework outlines a set of common challenges and opportunities, it does not point to a single root cause or universal solution. As freight customers vary in their levels of ‘green maturity’, cargo and transport types, and roles in the value chain, decarbonization solutions will also vary depending on the individual company.

With a focus on actions that individual freight customer companies can initiate today, this article highlights some illustrative examples from our research across three key levers: strategy and organization, logistics operations, and finance and costs. These examples and insights can help equip freight customers to drive forward their ambitions to decarbonize shipping and logistics.

In our study, we found that many of the freight customer companies that were purchasing low-emissions shipping and logistics solutions had:

• Elevated supply chain decarbonization as a strategic priority

• Integrated decarbonization targets into corporate strategy

• Aligned targets and roadmaps across the organization and linked these to financial budgets

Conversely, many of the stakeholders we interviewed reported that decarbonization ambitions often fail to gain traction without endorsement from executive management and strategic integration across the whole organization.

“While sustainability teams may have pledges and set decarbonization targets, these might be misaligned with procurement and operations functions that focus on transactional cost savings,” said one interview participant. “There is a need for clear mandates and internal alignment of targets to ensure that the sustainability strategy is effectively implemented across all departments and aligned with financial budgets.”

A lack of internal expertise in environmental sustainability and implementation, or of a clear value proposition for sustainability initiatives, can add further challenges.

To help address this challenge, companies can choose to integrate decarbonization targets and roadmaps into their core operations, align these targets to financial budgets, and prioritize sustainability education within their organization. Some freight customers we spoke to argued for the need to integrate decarbonization and sustainability functions into business operations, rather than treating them as an ‘add-on’.

“Sustainability is in the heart of the operation – it is not a sideshow,” said Martin Jermiin, Board member and former CEO of Flying Tiger Copenhagen. The international retailer has its sustainability department reporting into Commercial Planning, ensuring that sustainability is embedded into commercial decisions from product development to sourcing and delivery. Employees across departments also receive education and training in decarbonization, the circular economy, environmental impact of materials, and the company’s environmental strategy.

This area offers several solutions and opportunities for freight customers seeking to decarbonize supply chains. According to interview participants, the key challenge when using this lever is to maintain reliable and flexible operations while reducing transport-related emissions.

Freight customers report that they frequently work independently to optimize their supply chain practices, which can reduce energy demand and hence both emissions and costs. Examples of these practices include cargo consolidation, asset utilization, vessel efficiency, route optimization, and network optimization.

Some freight customers are exploring opportunities for new forms of pro-competitive collaboration with supply chain partners and peers – for example, co-loading cargo and sharing logistics. Pooling resources can allow companies to better utilize their assets while reducing costs and emissions. However, these approaches can also raise challenges when it comes to coordinating operations and ensuring operational flexibility.

Shifting from air to sea freight can be a win-win for both costs and the climate (see info box). If done right, the shift can reduce costs and emissions without compromising deliveries. The global pharmaceutical company Novo Nordisk is an example of a freight customer that has adopted this solution.

“Air-to-sea conversion has been identified as one of the most impactful actions we can take within logistics and distribution,” explained Said Chayesteh, Director of Global Logistics and Distribution, Integration & Optimisations at Novo Nordisk. He also noted that other pharmaceutical companies appear to be independently exploring similar modal shifts as an effective decarbonization measure.

The growing availability of low-carbon fuel offerings from shipping and logistics suppliers poses another avenue for reducing emissions. Today, the majority of the top ten leading container and car carriers offer biofuel-based solutions.16 Among the leading container carriers, Maersk report that 3% of cargo was transported with green fuels in 2023;17 CMA CGM Group report an 11% share of alternative fuels used in 2024;18 and Hapag-Lloyd increased its use of biofuel blends to around 195,000 tonnes in 2024.19 However, these solutions are currently more accessible in some segments, industries, or geographies than others. Collaborative platforms, such as buyers’ alliances and book-and-claim systems for sustainable maritime fuels, have emerged as innovative models that enable investment in alternative fuels (see e.g. Katalist,20 Zemba,21 and the MMMCZCS Freight Customer Framework 22 for more collaborative models).

In interviews, some freight customers reported that they focus on logistics optimization and modal switches first, then look to fuel switching to reduce their ‘residual’ supply chain emissions. Other interview participants reported that some freight customers find fuel switching to be a more realistic decarbonization option for their business.

“Customers decarbonize by looking into supply chain optimization, but some also realize that this can be a disruption to their supply chains, and that looking into sustainable fuels can be an easier solution,” said one participant.

This last point was also reflected by Said Chayesteh from Novo Nordisk: “It’s relatively easy to source biofuels certificates – it requires more work to redesign our distribution supply chain.”

Confronting the cost gap between conventional and decarbonized solutions is an important hurdle for many freight customers. For ocean freight, transport services based on biofuel blends can add up to a freight cost increase of around 10-20% for containers and around 50% for bulk.23 By way of comparison, decarbonizing air shipments using sustainable aviation fuel can increase shipment costs by up to around 60%.24

Fundamentally, measuring and documenting the value that decarbonization initiatives create is often more challenging than quantifying their short-term financial costs. It’s therefore no surprise that major carriers and logistics providers reported that many of their customers face difficulties in justifying internal budgets for shipping and logistics decarbonization.

However, our project also highlighted several nuances and opportunities within finance and costs. As previously mentioned, some solutions are a win-win for both cost and climate. Some companies reported in interviews that they could maintain budget levels by optimizing logistics and using the money saved to switch to lower-carbon fuels.

Further, increased costs are not necessarily a dealbreaker, according to the insights gathered through this project’s interviews and research. Some freight customers reported that the freight cost increase to total end-product cost was marginal.

Another interviewee observed that freight customers had been willing to pay a premium for shipping using marine biofuels, reflecting the higher willingness to pay for that specific shipping segment. However, the interviewee also noted that it remains uncertain whether similar willingness will extend to more expensive alternative fuels. This finding highlights that freight customers may benefit from considering both long- and short-term decarbonization options, and that willingness to pay differs between cargo and shipping segments, when developing their individual strategies.

Some freight customers we spoke to chose not to benchmark the cost of ‘green’ against conventional options. This approach enables these companies to prioritize emissions reductions without being constrained by short-term cost comparisons.

“For us, [sustainability] is not an incremental business case – it is a general mandate," remarked Martin Jermiin of Flying Tiger Copenhagen. "We do not always calculate the exact cost difference of more sustainable components; they are part of our baseline. In other words, sustainability is built into our commercial decisions and is part of the cost of doing business for us.”

This doesn’t mean that cost considerations go out the window – but low-emissions solutions can be internally benchmarked against each other, rather than against the ‘old way’ of doing things. For instance, Said Chayesteh observed that marine biofuels appear to be “relatively affordable” compared to air freight using sustainable aviation fuel (SAF) or road transport using electric vehicles. These examples illustrate how companies’ approaches to cost and sustainability can vary significantly, reflecting individual strategic choices.

Another challenge raised in our interviews was how companies can market and communicate their sustainability efforts to customers in order to capture value while avoiding greenwashing. Transparent, authentic, and data-based emissions standards and accounting, as well as consistent communication and use of trustworthy certification schemes, can add credibility.

If approached with care, green marketing and branding may offer companies a chance to simultaneously strengthen their brand and help defray the costs of investing in green initiatives, Moreover, this lever may support further decarbonization by helping to stimulate market demand for decarbonized transport and logistics solutions.

Looking at the big picture, a clear overall takeaway from our interviews with industry stakeholders is that progress on decarbonization doesn’t require perfection from the outset. On the contrary, early action often leads to lessons learned and momentum built over time. Barriers such as cost, complexity, and lack of internal alignment can be addressed through iteration, learning, and pro-competitive collaboration.

“We started small within our department [Global Logistics and Distribution, Integration and Optimisations] with areas where we had data insights," Said Chayesteh reflected. "Eventually, we expanded our data and visibility across different activities and developed a low-carbon distribution framework.”

Further underscoring this insight, shipping providers reported in interviews that their customers who begin exploring their emissions profiles more deeply often discover further opportunities to decarbonize. This exploration can, for example, contribute to greater market interest in sustainable fuels, while also strengthening business relationships between companies across the value chain. Even ‘unsuccessful’ initiatives can bring important lessons for companies to build on.

The bottom line? Waiting for perfect conditions or fully mature solutions can delay progress unnecessarily. Companies that start or accelerate their decarbonization initiatives now will be well positioned to lead as the market and regulatory context evolve. The MMMCZCS and other organizations have produced resources to help address freight customers’ decarbonization challenges (Smart Freight Centre,26 Zemba,27 Carbon Disclosure Project,28 World Economic Forum,29 First Movers Coalition,30 etc.), which companies may find useful in supporting their own decarbonization efforts.