E-Commerce Can Be A Key Enabler In Achieving Net Zero Target

The Indian e-commerce industry will be an important contributor to help the country to become a $5- trillion economy with its ecosystem-wide impact in digitizing lakhs of sellers and Micro, Small and Medium Enterprises (MSMEs) and generating millions of direct and indirect employment opportunities through supply chains. From organising the unorganised sectors to bringing unbanked citizens into the financial system and driving digital literacy among consumers and sellers, the e-commerce industry is vital to India’s economic growth. This makes the sector a catalyst in stirring up industry-wide changes which play a crucial role in achieving a collective vision for the country. E-commerce can be a big enabler in helping advance India’s sustainability efforts and achieving the net zero emission target by 2070.

At the heart of e-commerce operations are its supply chains, which form the backbone of the industry. This offers diverse opportunities to inculcate sustainability practices ranging from adopting renewable energy to using eco-friendly packaging alternatives, following water and waste management practices and deploying electric vehicles to offset the carbon emissions produced across the value chain. 

This, however, requires carefully coordinated efforts from all ecosystem partners to ensure that sustainable practices are a viable business proposition for suppliers to enable the ecosystem to take the sustainability initiatives ahead. Here, co-developing solutions with ecosystem partners can play a key role as an off-the-shelf or a one-size-fits-all concept might not be applicable and commercially viable. Furthermore, it also becomes imperative for large organisations to make public commitments about their sustainability efforts to help send out a positive message to the ecosystem and help build confidence in partners and suppliers for the successful run of these initiatives.

These efforts have been bolstered by government’s policies and incentives, including Smart Cities, National Clean Air Programme and National Policy on Resource Efficiency (RE) to enable multiple sectors to drive resource efficiency for achieving sustainability goals. This sectoral sustainability vision is also poised to trigger a cascade of beneficial domino effects, leading to more and more sellers, MSMEs and brands partners responding to the call for sustainable products and further complementing the efforts of creating a more responsible supply chain. Consumers are, in turn, responding favourably to sustainable products and operations. 

According to a 2022 research report by the World Business Council for Sustainable Development (WBCSD), the e-commerce sector is capable of electrifying 100% of its delivery operations. This is an advantage unique to e-commerce companies, and its technical and commercial viability underlines the immense potential of sustainable e-commerce logistics in India.

A sustainable last-mile experience, inclusive of sustainable packaging (replacing single-use plastic) and delivery via EVs is being lauded by consumers. A critical mass of sellers, suppliers and stakeholders is shifting to a sustainable way of doing business. As the sector continues growing on the back of a fast-digitising India, the journey towards net zero will unite millions of Indians to think sustainability first. E-commerce is thus a strong manifestation of the spirit of public-private collaboration needed to achieve a sustainable future.             

E-commerce companies who seek to lead the race towards net zero need to think big and set ambitious targets. First, they need to decarbonise their operations within the decade, and then decarbonise their larger value chain in line with the global Science-based Targets initiative (SBTi) of keeping the global temperature rise to below 1.5 degrees Celsius as per the Paris Climate Agreement.  By setting such targets, e-commerce in India can signal that it is willing to walk the walk through interventions across its value chain of suppliers, waste operations, transportation and logistics and product end-of-life in partnership with sellers, consumers and partners. 

Setting bold goals early can potentially help chart a road towards achieving sustainable operations and in parallel reduce and eventually cut out any processes that only contribute to carbon emissions. Concerning decarbonising e-commerce in the Indian context, such a pathway can cover three focus areas: 

Sustainable Platforms: Driving consumer awareness initiatives to support sustainable products while creating circular business models 

Responsible Value Chain: Electrification of logistics; incorporating renewable energy, environment-friendly packaging and waste management initiatives; undertaking responsible sourcing in business practices; establishing sustainable infrastructure and supplier engagement;  and supporting seller education 

Impact Positive Collaborations: Fostering industry partnerships on developing innovative solutions for creating a sustainable e-commerce model 

These, in sum, will help implement the clearly defined decarbonisation pathway that will unite the company and its stakeholders. It can be much like India’s renewables success story, which first set targets once considered too ambitious and then leveraged political will and market interest to achieve them. A net zero commitment will need ambitious goals to trigger action and e-commerce, which today prides itself on unlocking the potential of SMEs at the national scale, is well-placed to leverage its agile business models and digital efficiencies to support the goal of net zero. 

(The author is Director, Sustainability, Flipkart)