Peter Bakker became chief executive of Dutch international logistics and delivery services company TNT in 2001. He joined the company 10 years earlier, rising to financial control director in 1996 and chief financial officer in 1998. He has a degree in economics from Erasmus University, Rotterdam.
Ethical Corporation: Over 80% of CEOs say they feel their companies are integrating sustainability into their business operations. Does this sound overly optimistic to you?
Peter Bakker: Definitely. TNT, for example, has been a “super sector” leader in the Dow Jones Sustainable Development Index for the last four or five years. I don’t want to discredit that, but I know that we’re only scratching the surface.
EC: What would you say to these CEOs that feel their companies are already sustainable?
PB: The problem of being responsible is that you can’t be responsible for just one element of what you do. If one business activity within your company is not done responsibly or if CO2 is not prioritised, then all the good things you’re doing elsewhere are discredited. You have to be responsible throughout your business. The only way to get there is to confront everything you do, good and bad.
EC: TNT works with the World Food Programme to combat child hunger. What other issues do you feel require a partnership approach?
PB: Plenty. Like fighting corruption. One company alone cannot prevent it. If all sectors get involved, however, then we have a chance. Another area is reporting on carbon emissions. We’re now working on a common reporting standard within the transport sector. Without this, what do our emissions’ numbers mean? It’s a nonsense.
Urban infrastructure is a further example. In 20 years’ time, 80% of the world’s population will live in urban areas. That will result in billions of people needing new cities. If we don’t build those sustainably, then we can forget about the planet.
EC: Is it challenging to work in partnership with competitor companies?
PB: It takes some cultural change. For example, we once sent a 747 plane full of high-energy biscuits from Italy to Haiti. We had to unload the plane in Miami because 747s couldn’t land in Haiti at the time. We didn’t have any planes in the US, but our competitor, UPS, had lots. So we asked our crew to load the contents onto a UPS plane. Culturally, that’s an almost impossible ask. But then if you can’t cooperate when it comes to saving lives, then there’s no hope of cooperating elsewhere. We shouldn’t compete in sustainability. There are simply not enough resources to go around.
EC: Do you see collaboration extending to the sharing of technologies
PB: Yes. To make the world sustainable, we need a lot of new technology. Yet without scale, new technology cannot compete with the economics of existing technology. The only way to get to scale is to get purchasing power upfront. If we share new technology with our competitors, then we can approach manufacturers with a scale proposal. After all, it’s not like we can invent stuff that nobody else can, so we might as well do it together.
EC: Although corporations like to speak of “win-wins”, are there trade-offs to be made between business responsibility and current growth models?
PB: Sure, there are difficult areas. Think about optimising traffic in a city, for instance. Should we really have multiple companies’ vans driving around? Or would it be better to build warehouses on the edge of the city, consolidate all the traffic there and then bring one public transport system into town? The second is obviously the best solution. Yet my advertising depends on having as many trucks on the streets as possible. That’s the kind of question that the business world has to figure out.
EC: Won’t the prevailing system always win, then?
PB: Not necessarily. But it’s much more difficult to change an existing system than to create a new system. In China, for example, there are currently 20 new cities being developed. All will have a minimum population of three million. Our intention is to collaborate in experimenting with sustainable solutions in these cities and then bring these models back to western Europe.
EC: What do you do personally to contribute to reduce your footprint on the planet?
PB: A couple of years ago, I kicked out the big company car and replaced it with a Toyota Prius. Beyond just being a CEO, I agree we all need to become much more concerned citizens of this planet. It’s not going in the right direction at the moment.
Fast facts: TNT
Headquarters: Hoofddorp, Netherlands
Industry sector: Express, package and mail delivery and logistics services
Turnover (2010): €11,329bn
Operating profit (2010): €660m
Net profit (2010): €347m
Employees (2011): c 156,000