In mid-November 2022, Prologis Zhengzhou Airport Logistics Center was put into operation. With a total floor space of 267,839 square meters, it is located east of Jingzhou Road and south of Bodu Road in the Zhengzhou Airport Economy Zone (ZAEZ) in Zhongmou County, Zhengzhou City, Henan Province.
“Companies should focus on the intersection between their core businesses and the issues facing the industry they are involved in, since the issues could present significant risks and opportunities.” In an interview with the China Times, the marketing executive pointed out how Prologis China advocates for companies to take into account the demands they place on the environment as they grow as well as any impact they may have on partners, employees and social development.
From rooftop solar panels to zero net energy buildings, from building a “shelter” to “revitalizing” the ecosystem, Prologis has placed ESG high up on its list of priorities.
01 Reducing costs and increasing efficiency
The logistics industry has a significant impact on global greenhouse gas emissions. It is of particular importance for companies to develop smart buildings and build green high-standard warehouses to reduce energy use during operation.
To this end, Prologis has already installed rooftop PV systems in its properties through its SolarSmart solution. By the end of September 2022, Prologis’ solar installations totaled 378 megawatts worldwide, ranking second in the U.S corporations.
“The company has projects in China, the U.S., Brazil, Canada, France and Mexico, all of which have been LEED certified,” said the executive.
According to a white paper titled “The Impact of ESG on China’s Logistics Real Estate”, which was jointly published by Prologis and Jones Lang LaSalle this year, tenants tend to see ESG as an important metric for determining the quality of warehousing going forward.
Taking this into consideration, Prologis has set more ambitious goals in its 2021-2022 ESG Report: 1 GW of solar energy capacity, supported by energy storage, by 2025; net zero emissions from operations by 2030; net zero emissions by 2040 across the entire value chain.
Q：Is such a combination of goals too ambitious?
The executive said: “As of the third quarter of 2022, Prologis was operating and managing more than 5,000 logistics facilities in more than a dozen countries around the world, with assets under management of more than $170 billion and nearly 6,000 customers. We have always made ESG a top strategic priority, along with the Prologis 3Cs (Customer Centricity; Change Through Innovation and Operational Excellence; and Culture and Talent). You could even say that ESG overrides all of Prologis’ other visions and goals. It is in the DNA of Prologis.”
02 From building a “shelter” to “revitalizing” the ecosystem
In addition to using its influence to call upon more people to participate in public undertakings, Prologis is also using its property network to create value for communities, society and the industry.
The “Inagawa Project” in Japan was completed on April 27, 2022. Apart from the application of green construction methods, the project also signed a basic agreement with the local community on disaster prevention in the Kankanawa Industrial Base area. The logistics park will serve as a storage and transportation base for relief supplies in the event of a disaster.
Prologis has increased its presence throughout China with more than 40 industrial parks in the country.
“We are not only building warehouses, we want to be an enabler of local industry upgrading. Ultimately, we want to contribute to the overall development of the Chinese economy. Revitalizing a project drives industry in a region, and it has a positive impact on the entire ecosystem,” said the head of marketing.
03 ESG is not a one-man show
For Prologis, the biggest hurdle to achieving net zero emissions across the whole value chain by 2040 is that it involves all aspects of the logistics and warehousing industry chain. In fact, it is a universal problem for the market as a whole.
“Companies must first fundamentally recognize ESG as a long-term commitment.” The marketing director believes that ESG can be used as a fulcrum for achieving energy efficiency improvements and that promoting industrial upgrading and low-carbon transformation is exactly what is needed for leading enterprises to make ESG a reality.
ESG ≠ a solo act
“ESG is not a one-man show. Prologis itself needs to continuously optimize its ESG goals and do its best to reach these goals. It also needs the support of the government, the recognition and synergy of players upstream and downstream of the industry chain and, to top it all, it needs to call upon the combined efforts of the whole of society,” said the head of marketing.