Analyst Insight: Traditional conversations around ESG in logistics often focus on environmental goals, with decarbonization, fuel efficiency, and emission reductions at the forefront. While maintaining this focus, companies should also emphasize a core part of ESG’s social pillar: safety.

Safety is included under ESG’s social pillar, but in the context of logistics, it often takes a backseat to other social issues, such as labor rights and supply chain ethics. A significant portion of ESG logistics reporting also tends to focus on environmental impacts. Indeed, for many companies, ESG is nearly synonymous with environmental issues. This deep concern makes sense. The logistics industry bears a disproportionate responsibility for contributions to global greenhouse gas emissions — with the EPA estimating recently that transportation and logistics generated about 28% of U.S. CO2 emissions. As high-profile and high-risk areas of concern, decarbonization, fuel efficiency, and emissions reductions often take center stage — with some companies committing to net-zero emissions by 2050. 

Safety, and especially worker and operational safety, should be seen as complementing these efforts, because overlooking it invites significant consequences. It is not an isolated issue; it’s a throughline running through several ESG priorities. Lapses in safety don’t simply jeopardize individual workers, they have the potential to spark supply chain delays, slow down operations, and even trigger environmental disasters. Safety needs to be understood as an organizational value, and as an ESG multiplier, with the ability to both reduce risk and amplify resilience. 

How Safety Affects the Supply Chain

The supply chain is complex, deploying multiple modes of transport, from trucking to maritime. It’s also a major employer of workers across the world. In the U.S., for example, the supply chain accounts for at least 44 million jobs — that’s 37% of all American jobs. This complexity, combined with the sheer volume of workers affected, makes managing safety on an industrial scale more complicated. 

In managing safety, worker safety is the paramount concern. This is especially the case given the disproportionate danger of working in the supply chain. In the U.S., workers in transportation and material-moving roles face fatality rates nearly four times as high as the average across all industries. These accidents happen in trucks, warehouses, and ports, and are often related to operating heavy machinery, vehicle collisions, or hazardous materials. 

Beyond the human cost, safety incidents also cause operational disruptions. Accidents can be a starting point for critical supply chain disruptions, whether caused by natural disasters or other factors. These safety incidents can cause a domino effect, provoking delays, financial losses, backlogs or other slowdowns. Against a backdrop of increased disruptions generally — with some estimating a cost of $1.6 trillion to businesses each year stemming from logistics disruptions — it becomes even more critical to neutralize any source of interference. 

Furthermore, certain safety incidents, particularly those involving hazardous substances, can lead to severe environmental damage. Train derailments carrying hazardous materials start as safety problems and evolve quickly into large-scale environmental disasters. The East Palestine, Ohio, example is one among many. 

Investor Expectations on the Rise

Aside from these internal factors, logistics professionals will increasingly experience external pressure to take safety more seriously. At a broader scale, a recent investor survey from Harvard noted that 44.1% expect future ESG ratings to place a greater weight on workplace safety, treatment of employees, and supply chain labor dynamics. 

As such, increasingly poor safety records are making investors skittish. Safety is not merely an issue relevant to internal stakeholders. Poor safety records provoke rising insurance premiums, higher liability risks, and reputational harm that can limit access to capital. Deprioritizing safety is therefore not simply a risk multiplier, but also a potentially powerful competitive disadvantage. 

An Organizational Value

Safety should not be overlooked; it is an important component of logistics ESG. Workplace safety is a freestanding right for workers and an obligation for companies — but the impact of safety incidents extends beyond workers to include supply chain disruptions and environmental disasters. 

Leading logistics companies will move beyond fragmented reporting, recognizing that safety is an important piece of organizational resilience and company values. As this recognition matures, safety metrics should be woven into ESG strategies that complement carbon targets and labor rights initiatives. When safety is embedded as a core organizational value — influencing behaviors and mindsets — it cultivates a culture of trust and accountability. At a practical level, this means developing clear sets of safety key performance indicators that can be referred to during leadership meetings and stakeholder communications, as well as ESG disclosures. 

Companies that treat safety as an ESG multiplier and an organizational value will improve their reporting overall, and be better positioned to navigate operational complexity, deepen trust with stakeholders, and exceed investor expectations.