6.1 Theoretical Background on Organizational Management

Attempts at theory-building in sustainable SCM and logistics are to date rather scarce. Many papers in the field of sustainable SCM and logistics lack a theoretical lens to provide theoretical perspectives (Touboulic and Walker, 2015). Several authors stress the theoretical dearth in the field of sustainable SCM (Touboulic and Walker, 2015; Carter and Easton, 2011; Sarkis et al., 2011). However, there are some popular organizational theories which were repeatedly used in the past to study problems related to sustainable SCM/logistics. In order to successfully employ policy measures which encourage organizations’ environmental commitment, the fundamental principles of organizational management must be understood. The profound understanding of how a company works and knowledge on organizations’ operational principles allow the setting of precise and target-oriented measures for sustainability. In this subchapter, multiple theoretical lenses are used to understand organizational management and derive implications on how to influence organizational behavior with suitable policy measures. The conceptual framework illustrated in this subchapter provides the theoretical foundation for the fourth research question (Which policy measures promote the implementation of sustainable freight transport strategies?).

Organizational theories aim to provide “a management insight that can help explain or describe organizational behaviors, designs, or structures” (Sarkis et al., 2011, p. 2). A wide range of disciplines contributed to the development of organizational theories, among them sociology, psychology, economics, political science and engineering (Hatch, 2018). Several literature reviews exist which map the theoretical framework of sustainable SCM and logistics studies (e.g. Liu et al., 2018; Dubey et al., 2017; Touboulic and Walker, 2015; Carter and Easton, 2011; Sarkis et al., 2011; Carter and Rogers, 2008). The collection of theories presented in these literature reviews were examined carefully in the course of this thesis. Those theories which indicate how to motivate the implementation of sustainable practices (such as sustainable freight transport strategies) were chosen as relevant theoretical lenses. Table 6.1 describes the theories that were classified as relevant and gives examples of studies which borrow from these theories in the context of sustainable SCM/logistics/transport practices.

Eight theories were chosen as relevant for deriving indications on how to encourage sustainable practices. These eight theories can be classified according to three different dimensions related to organizational existence, namely (1) organizational obligations (2) organizational capabilities (3) organizational functioning. Figure 6.2 depicts the three dimensions and their related theories using a Venn diagram. A Venn diagram is a popular way to illustrate the three pillars of sustainability (economic, social and environmental performance) using three circles that intersect (Lozano, 2008). The overlap of all three circles in the center of the diagram represents truly sustainable performance (Figure 6.1). An overlap of two circles represents partial sustainability and is referred to as equitable, bearable or viable performance (Figure 6.1). The three organizational dimensions (obligations, capabilities and functioning) each represent one of the three pillars of sustainability (economic, social and environmental) and thus can be also depicted using a Venn diagram.

Figure 6.1
figure 1

(based on Dalal-Clayton and Bass, 2002)

Venn diagram illustrating the three pillars of sustainability.

Full size image

Organizational obligations represent social responsibility which organizations have towards their stakeholders. Organizational functioning constitutes the operational principles of organizations’ performance which are predominantly based on economic considerations. And finally, organizational capabilities refer to the capacities and resources that organizations have access to, which are often limited by environmental conditions. Since the three dimensions of organizational obligations, capabilities and functioning each represent one of the sustainability pillars, they can also be classified according to equitable, bearable, viable and sustainable practices. For example, practices that comply with organizational obligations and organizational functioning are referred to as equitable in Figure 6.2. Practices that comply with organizational obligations and organizational capabilities are referred to as bearable, and practices that comply with organizational functioning and organizational capabilities are referred to as viable. In the following, each organizational dimension and their associated theories will be explained in detail. Later, in Subchapter 6.3.5, the theories will be used to support the policy measures for sustainable freight transport.

Figure 6.2
figure 2

Theoretical framework to explain the adoption of sustainable freight transport strategies

Full size image

6.1.1 Organizational Obligations

Several theories exist which refer to the companies’ relationship to other organizations and the resulting obligations. Within their corporate activities, companies have to satisfy the needs of several parties, not only shareholders (owners), but also other stakeholders like governments, industrial interest groups, NGOs, customers, and society as a whole (Sen and Cowley, 2013). The stakeholder theory (Freeman, 1984) illustrates the responsibility of organizations to meet the expectations of their manifold stakeholders. These expectations also involve environmental concerns of stakeholders. Stakeholder theory is one of the most used theories in the context of sustainable SCM (Touboulic and Walker, 2015). Stakeholder theory postulates that stakeholder pressure influences the sustainable behavior of organizations. If stakeholders express environmental needs, then organizations tend to introduce sustainable strategies (Yuen et al., 2017). The agency theory (Eisenhardt, 1989) uses a similar approach to explain companies’ environmental engagement. The essence of agency theory is that one organization (the principal) authorizes another organization (the agent) to act on behalf of the principal (Sarkis et al., 2011). Within their role as agents, companies are obligated to meet the sustainability concerns of the principals (Berrone and Gomez-Mejia, 2009). Principals may use incentives (such as reward systems) to stimulate pro-environmental behavior (Cordeiro and Sarkis, 2008).

Additionally the institutional theory (DiMaggio and Powell, 1983) is helpful to understand how companies can be motivated towards more sustainable behavior. According to the institutional theory, coercive, normative and mimetic pressures constitute an incentive that drives sustainable transport practices or discourage unsustainable transport practices (Morali and Searcy, 2013). Environmental regulations represent an example of coercive pressure. Coercive pressure often comes from governments or government agencies (Rivera, 2004). In contrast, normative pressure is mostly caused by customer and market requirements (Zhu et al., 2013). Mimetic pressure appears when an organization imitates the actions of successful competitors (e.g. “green champions”) in the same industry (Sancha et al., 2015).

6.1.2 Organizational Capabilities

Several theories related to resources describe companies’ capabilities to adopt sustainable strategies. The resource-based view (RBV) claims that companies gain a competitive advantage through their valuable, rare, inimitable and non-substitutable resources (Barney, 1991; Wernerfelt, 1984). In terms of sustainable transport practices, RBV teaches us that specific resources are required to enhance the environmental, social and economic performance in the supply chain (Touboulic and Walker, 2015). Aiming for sustainable business activities and greening the supply chain is also an opportunity to gain a competitive advantage (for example via differentiation and increased market power) (Sarkis et al., 2011). In this context, knowledge resources and organizational learning provide additional important capabilities which enable sustainable transport practices (knowledge-based view, Grant, 1996). Green knowledge, sometimes also called green intellectual capital, is a fundamental resource which provides the basis for dynamic capabilities needed in unstable, competitive business environments (Wu, 2010). The natural-resource-based view (NRBV, Hart, 1995) is an extension of RBV which accounts for the fact that the natural environment may constitute a severe constraint for creating a competitive advantage. As early as 1995, the originator of NRBV anticipated that “it is likely that strategy and competitive advantage in the coming years will be rooted in capabilities that facilitate environmentally sustainable economic activity—a natural-resource-based view of the firm” (Hart, 1995, p. 991). Today, with the ever-increasing rise of the climate change, this statement holds true even more (Hart and Dowell, 2011).

The theories on organizational capabilities described above demonstrate that different types of resources enable (or limit) the organizational potential for sustainable action. Thus, it can be expected that supporting companies to gain the required resources for sustainable practices will motivate them towards environmental engagement (Morali and Searcy, 2013).

6.1.3 Organizational Functioning

Transaction cost economics and resource dependence theory are two theories which explain organizational functioning, i.e. the principles outlining how companies work or operate in a proper way. The basic assumption of transaction cost economics (TCE) is that two organizations engaged in a business activity incur costs as well as efforts (Williamson, 1981). Their goal is to establish management instruments and control systems such as contractual arrangements to minimize their transaction costs (Touboulic and Walker, 2015). Several elements of TCE can be utilized to explain decisions on investments and strategies towards sustainable transport practices (Sarkis et al., 2011). The most evident implication of TCE is that the occurrence of transaction costs has an impact on the acceptance of sustainable practices (Touboulic and Walker, 2015). According to TCE, organizations are going to evaluate carefully the actual costs on different types of transactions of decisions and practices within sustainable business activities (Sarkis et al., 2011). Sustainable standards are more likely to be implemented if they improve the transaction costs in the supply chain (Rosen et al., 2002).

Resource dependence theory (RDT, Pfeffer and Salancik, 1978) postulates that organizations are dependent on external parties’ resources to increase their performance and sustain long-term benefits. Organizations will therefore seek collaboration with other partners to attain the resources they are dependent on (Ulrich and Barney, 1984). Applying RDT to the adoption of sustainable transport practices implies that organizations must carefully manage their dependence on external resources such as enabling technologies, distribution channels, standards or procedures (Sarkis et al., 2011). The quality and effectiveness of collaboration with other partners will influence the success of implementing sustainable strategies (Shang et al., 2010). Another aspect of resource dependence is that collaborating partners develop increased power over smaller organizations, and they tend to develop environmentally sound practices which will later also be adopted by the smaller organizations (González et al., 2008). It can be concluded that enabling the effective collaboration and resource exchange between partners would be an efficient measure to encourage sustainable practices (Morali and Searcy, 2013).

Table 6.1 Theories explaining the occurrence of sustainable freight transport practices
Full size table

6.2 Market Failures in Sustainable Freight Transport

The empirical investigation (interviews, focus group discussions) in the course of this thesis revealed that many problems related to sustainable freight transport are a result of market failures. Market failures are caused by the fact that individuals usually follow their self-interest and make the correct decision for themselves, instead of taking into account what is best for the whole group of individuals (Ledyard, 2008). In many cases, the individuals’ decisions are not optimal from the societal point of view, which leads to market failures (Krugman and Wells, 2017). The Industry Commission (1998) underlined that the existence of market failures can be combated by policies that achieve better outcomes for society as a whole. Therefore, in this subchapter the main market failures which influence sustainable freight transport practices will be presented to show which problems have to be addressed by policy measures.

6.2.1 Tragedy of the Commons

The transportation system involves both, individual goods (e.g. transport assets such as trucks) and common goods (e.g. the environment or atmosphere) (Richardson, 2005). The problem is that if private organizations such as logistics companies make any investments towards sustainable innovations, the value of this investment will most probably benefit third parties, such as society more than the organization itself (Richardson, 2005). For example, if an LSP purchases a truck which emits fewer emissions, the LSP has to bear the expenses for this investment although it only obtains a small share of the benefit (i.e. better air quality). Therefore, there is little motivation for organizations to realize sustainable transport policies because there is a disparity between the costs incurred and the benefits gained (Howes et al., 2017).

The problem described is an example of the tragedy of the commons (Hardin, 1968). The tragedy of the commons predicts that common resources will suffer from overconsumption, under-investment and ultimately the depletion of the common resource due to the fact that others cannot be excluded from using the resource (Burger and Gochfeld, 1998; Faysse, 2005). Common resources are not owned by any individuals but by society as a whole, and this causes individuals to exploit the common resources to a degree that is inefficient at the collective level (Faysse, 2005). Although it would be desirable from the collective viewpoint to protect the common resources from overconsumption, it is economically irrational for an individual player (e.g. a company) to do so (Engel and Saleska, 2005). Market mechanisms have to appropriately manage the common resources to ensure that they are not reaped beyond their carrying capacity (Jenkins, 2002). Since the markets currently fail to do so, government regulations are necessary to address this problem. One participant of the multimodality focus group put it in a nutshell:

“Governmental regulation is absolutely needed to manage the consumption of natural resources and handle the problem of air pollution. If there were no regulations which restrict the maximum permitted speed, everyone would speed on the roads. The same applies to environmental issues—no company would consider them unless they are forced to.”

Regulating the consumption of the commons is something that has to be implemented on a transnational level, otherwise no efficient results will be obtained.

6.2.2 Existence of Externalities

The transport sector is responsible for a multitude of negative externalities which are currently not sufficiently reflected in transport prices. These negative externalities include emissions, congestion, accidents, noise, vibration and other harmful effects which negatively affect third parties (Demir et al., 2015). Prices aim to deliver a market equilibrium, but due to the existence of externalities in the transport market, the prices will lead to an inefficient resource allocation (Figure 6.3). In theory, negative externalities lead to market volumes that are too high because the prices are too low (Pindyck and Rubinfeld, 2013). In the transport sector, the excess volumes caused by the negative externalities are perfectly illustrated in practice by road congestion.

Figure 6.3
figure 3

(based on Pindyck and Rubinfeld, 2013)

Microeconomic effects of negative externalities.

Full size image

Internalizing negative externalities is therefore an important task for policy to take on. This was also discussed during the focus group on multimodality. One participant of the multimodality focus group stated very clearly:

“The internalization of external costs is much more appropriate to create an economic incentive than the introduction of subsidies for multimodal transport. The reason is that subsidies rather distort competition while the internalization of external costs reflect the true cost of transport”

The other participants of the focus group strongly shared this opinion and recommended that politicians should make intensive efforts to internalize the external costs of road transport. The participants of the focus group stated that subsidies would cause controversy and dissent about the foundation for granting the subsidies. For example, the truck lobby associations will complain if railways receive funding from politics. However, if the “polluter pays” principle comes into effect, there is a clear rationale for the reallocation of economic burden. This will create a level playing field between all transport modes and make external costs part of the decision-making process of shippers (van Essen et al., 2019).

6.2.3 Information Failure

Information failure is another type of market failure that occurs in many different markets, including the transport and logistics market. There exist two main types of information failure: asymmetric information and imperfect information (Pindyck and Rubinfeld, 2013). Asymmetric (or unbalanced) information occurs if one party has more knowledge than the other party within a business transaction. This may lead to opportunistic behavior of the party with advanced knowledge (Sinnandavar et al., 2018). In context of sustainable freight transport, imperfect information is more relevant than asymmetric information. Imperfect information refers to the situation where a party does not have all the information required to make an informed business decision (Pindyck and Rubinfeld, 2013). Due to imperfect information, in many cases it is difficult for the logistics companies to understand the importance of sustainable transport (Chen et al., 2018). A lack of efficient information and knowledge leads to incomplete markets where the resources are allocated insufficiently (Pratt and Phillips, 2000). The information failure is caused by the fact that it is hard for logistics companies to capture relevant information on sustainable freight transport solutions. Due to the lack of knowledge and information, an investment into sustainable strategies is perceived as risky by logistics companies, which leads to under-investment for sustainability (Nakamura et al., 2003).

The problem of insufficient information was discussed during the focus group on multimodality. A shipper from the plastics industry stated that it is tremendously difficult for him to find information about multimodal transport offers. The participants agreed that multimodal transport is more complex than unimodal truck transport, and many companies are therefore reluctant to implement multimodality since they lack the required information. There also seems to be some kind of information asymmetry between the shippers (i.e. the cargo owners) and the freight forwarding companies. The shipper from the plastics industry reported that he tried to get transport offers from several multimodal transport operators, but these refused to inform him since they only deal with requests from freight forwarding companies. Due to these information failures, the implementation of sustainable transport strategies is inhibited in the logistics industry.

6.2.4 Free-rider Behavior

A free-rider problem occurs when costs and benefits of a strategy or action are not distributed equally among the parties involved (Pindyck and Rubinfeld, 2013). Implementing sustainable freight transport strategies is a typical scenario which creates an opportunity for free-riding. If one organization takes measures to reduce the ecological impact of transport, it incurs the costs of this measure but it will not fully obtain the benefits since other organizations gain the benefit as well, whether or not they set own sustainability measures (Engel and Saleska, 2005). The free-rider problem is similar to the tragedy of the commons, but it can also occur with goods that are non-rival and non-excludable in use, for example knowledge (Pindyck and Rubinfeld, 2013).

Horizontal collaboration between partners often involves the risk of free-rider behavior, for example because one partner may invest into assets (e.g. ICT systems), and the other partner may benefit from these investments without adequately sharing the costs (van der Horst and Langen, 2008). Efficient gain-sharing mechanisms must therefore be set up to allocate the benefits and prevent partners from free-riding. LSP#1 from the PI case study explains his expectations about a gain-sharing mechanism:

“Fair accounting should be achieved—executed by a neutral entity—with agreed unit prices, as well as with transparent and flexible pricing models”

6.3 Policy Measures to Promote Sustainable Freight Transport

The following subchapter presents policy measures that are (from the logistics companies’ point of view) suitable to promote sustainable transport. These policy measures were developed within the focus groups of different projects on the topics of PI, multimodality and LNG. Several measures proved to be relevant for all three pillars of sustainable freight transport (avoid, shift, improve). These overarching measures will be presented below.

6.3.1 Overview / Comparison

In Plasch et al. (2021), Pfoser (in press), Pfoser et al. (2016a) and Pfoser et al. (2018d) it was elaborated which policy measures and/or success factors encourage logistics companies to implement sustainable freight transport strategies. Each paper refers to one of the three ASI pillars: Plasch et al. (2021) describe the success factors of a PI network, Pfoser (in press) analyzes policy measures to promote multimodal freight transport, and Pfoser et al. (2018d) as well as Pfoser et al. (2016a) raise policy measures and enablers to facilitate LNG as an alternative truck fuel. Together, these publications allow for a comparison of the policy measures that promote sustainable transport. The comparison of policy measures of different ASI pillars is illustrated in Table 6.2.

As described above, environmental policy theories refer to three types of policy measures- sticks, carrots and sermons (see 2.2 Typology of policy measures). An important implication resulting from the user-centric approach in this study is that logistics companies do not favor command & control measures (i.e. sticks) to promote sustainable freight transport. As can be seen in Table 6.2 no regulations or other command & control measures were proposed in any of the focus groups. Instead, another type of measures arose which is not covered by the common threefold sticks-carrots-sermons typology. This new type of measures involves the provision of basic infrastructure and framework conditions needed to use sustainable freight transport. The provision of infrastructure and other framework conditions is referred to as “means” in Table 6.2. At first glance, the instrument means shares some similarities with regulations and economic incentives. This is because, on the one hand, means can be provided by enacting laws and regulations (e.g. to create favorable legal conditions for sustainable transport) and on the other hand, means can be provided by using monetary resources (e.g. for infrastructure development). Despite these similarities, there are attributes that clearly distinguish means from sticks and carrots. The regulations that are issued to provide means do not force logistics companies to implement sustainable freight transport. They still have the freedom to choose whether they want to implement sustainable transport strategies. Thereby, means are different from sticks. And second, as opposed to economic incentives, the monetary resources that are spent on means are not intended to make it cheaper or more expensive for logistics companies to implement sustainable freight transport. Instead, the monetary resources are intended to enable logistics companies to implement sustainable freight transport. Therefore, means are also different from economic incentives.

To conclude, the new typology suggested to effectively promote sustainable freight transport strategies would be carrots-means-sermons instead of sticks-carrots-sermons (Figure 6.4). In this new typology, carrots can be considered the most restrictive and sermons the least restrictive measure. In the following subsections, the three types of measures suggested to promote sustainable freight transport will be presented in detail.

Figure 6.4
figure 4

Classification of user-centric policy measures for sustainable freight transport

Full size image
Table 6.2 Policy measures to promote sustainable freight transport
Full size table

6.3.2 Carrots for Sustainable Freight Transport

The implementation of sustainable transport strategies can be quite capital-intensive. The first (and from logistics companies’ point of view most important) category of policy measures for sustainable freight transport is therefore carrots, i.e. monetary incentives. Monetary incentives address the fundamental need of logistics companies for profitability (see explanations in 5.2.2).

In the context of LNG, subsidies and grants constitute important monetary instruments to foster logistics companies’ investment into LNG fueled vehicles (Pfoser et al., 2018d). The higher investment cost of LNG fueled trucks is one of the main barriers for fleet operators because the acquisition of alternatively fueled vehicles has to pay off for them (Pfoser et al., 2016a; Ma et al., 2013). Receiving funding for LNG vehicles from the public sector is therefore a fundamental driving force that encourages logistics companies to start up LNG fleets (Engerer and Horn, 2010; Osorio-Tejada et al., 2015; Wang et al., 2015). Governments have different options to incentivize LNG usage with monetary instruments. On the one hand, they can support the fuel price by granting tax advantages for LNG, which makes LNG cheaper as compared to diesel (Yeh, 2007). This is already practiced in several European countries (Peters-von Rosenstiel et al., 2015). On the other hand, the purchase price of LNG vehicles could be subsidized by investment bonuses or loans. This has also been realized in some European countries, for example in Sweden an investment subsidy of €17,000 per truck was granted (Peters-von Rosenstiel et al., 2015) and in Germany an investment subsidy of €12,000 per truck was recently announced and already used by several companies (Landwehr, 2020). Importantly, these subsidies should only be necessary to stimulate initial demand and encourage first pioneer users. After a sufficient increase of the demand has taken place, the production volumes of LNG vehicles should rise to such an extent that the purchase prices fall (Pfoser et al., 2018d).

Also in the context of multimodality logistics companies emphasized that economic incentives are of utmost importance for them. Out of ten respondents from the interviews, eight affirmed that cost reduction is a very important or an important measure to increase the share of multimodal transport. However, compared to the study on LNG, a different approach was suggested by the respondents to reduce the costs of multimodal transport. In the focus group it was discussed that neither subsidies nor grants should be offered as monetary incentives to promote multimodal transport, but instead the external costs of transport should be internalized appropriately (Pfoser, in press). The reason is that subsidies distort competition while the internalization of external costs reflects the true cost of transport according to the “polluter pays” principle. An internalization of external costs would be in favor of the sustainable transport modes, including multimodal transport. Since the main variable of mode choice is transport price (Pfoser et al., 2018c), it would be highly efficient if transport prices are based on true-cost pricing and thus fully reflect external costs (Mostert and Limbourg, 2016). The internalization of external costs aims to create a level playing field between all transport modes such that external costs become part of the decision-making process in the logistics industry. At the moment, road transport is too cheap because it does not reflect the emissions, noise, congestion etc. that it causes (van Essen et al., 2019). This is why road transport dominates in the transport sector. In the focus group on multimodal transport, the internalization of external costs was rated as the most feasible and at the same time also the most effective policy measure to promote a modal shift, it is therefore considered as a high-impact measure (Pfoser, in press).

The remaining ASI pillar, avoid, does not require any economic policy measures. This is related to the fact that no additional assets or infrastructure are needed for the avoid strategies such as horizontal collaboration. Though profitability is equally important for horizontal logistics collaboration as well, it is expected that cost savings will result from bundling of transport streams and economies of scale (Plasch et al., 2021; Vanovermeire et al., 2014). Additional external monetary incentives are not necessary from the logistics companies’ point of view.

6.3.3 Means for Sustainable Freight Transport

The empirical investigation revealed that logistics companies desire three different means that support the implementation of sustainable freight transport: Infrastructural development, information & transparency and adaptation of the legal framework.

Infrastructural development is relevant for all three ASI pillars, especially for multimodality and LNG. Multimodal transport requires sufficient terminals that combine different modes of transport (Šakalys and Batarlienė, 2017; Kreutzberger and Konings, 2016). LNG requires an appropriate network of refueling stations (Osorio-Tejada et al., 2017; Chang et al., 2008). According to the logistics companies, governmental authorities should support the development of this infrastructure by putting forward development plans and funding the construction (Pfoser et al., 2018d; Pfoser, in press). Importantly, logistics companies claim not only new and additional infrastructure needs to be built, but also the existing infrastructure should be improved by efficiency gains. As a matter of fact, the number of multimodal terminals is considered to be appropriate at the moment, but proper planning, extended opening hours and increased utilization are measures advised to improve existing infrastructure (Pfoser, in press). Also horizontal collaboration in the PI requires infrastructure, but as mentioned before, this infrastructure will not be newly constructed, but instead used in a different way. Specifically, warehouses and transport capacities will be used in an open and shared way by logistics companies (Vanovermeire et al., 2014). Policy measures can present an impetus for companies to start thinking about sharing warehouses and other logistics infrastructure, although policy measures alone may not be sufficient to convince logistics companies to open their infrastructure to others. This is because the strategic alliance with (potential) competitors is a radical change for companies. The preferential treatment of horizontal logistics collaborations in tender procedures may constitute a measure to encourage the PI.

Promoting information and transparency is another measure that is suitable to support sustainable freight transport, namely the two pillars avoid and shift. For horizontal collaboration to work, full network transparency is a vital feature for logistics companies. Political authorities can advance the occurrence of full network transparency by enforcing the monitoring of the PI performance. This monitoring can be accomplished by establishing control levers for tracing and documenting operational process performance in the PI network, e.g. delivery time and quality (Plasch et al., 2021). In the case of multimodality, tracking transport performance to allow for quality improvements and increased reliability of the service is also an important issue raised by the logistics companies (Pfoser, in press). In the focus group on multimodality, participants affirmed that they would highly appreciate the establishment of a one-stop-shop to make multimodal operations more flexible and easy-to-use (Pfoser, in press). The focus group participants rated this measure to be the second most important for promoting a modal shift. Various types of information can be transmitted in such a one-stop-shop, e.g. customs related data, estimated time of arrival or frequency of service (Islam et al., 2016). Another function is to comprehensively inform new entrants about the multimodal offers and make the booking of multimodal services as easy as booking road transport.

The adaption of the legal framework is a means that is expected to facilitate all three pillars of sustainable freight transport. Horizontal collaboration in a PI network needs an appropriate legal framework, since logistics companies may not be allowed to work together due to antitrust policies and regulations (Geerlings et al., 2017). Here, governments have to intervene and create legal certainty to enable horizontal collaboration (Pfoser et al., in press). For multimodal transport, a harmonization of the rail standards would be highly beneficial due to the fact that currently the multimodal business suffers from a variety of different standards among the European countries (Pfoser, in press). Another legal adaptation suggested to promote multimodality is increased weight permissions (e.g. increased maximum permissible weight for multimodal pre- and post-haulage or increased axle loads for railways). An increased permissible total weight reduces the number of transshipments and hence the cost per metric ton (Mortimer and Islam, 2014; Rodrigue and Notteboom, 2010). To promote LNG, a simplification of the concession processes is suggested as a useful measure (Pfoser et al., 2016a). Since LNG is classified as a dangerous good, the admission procedures are cumbersome and bureaucratic (Osorio-Tejada et al., 2017). Authorities can harmonize and simplify the application formalities and thus support the dissemination of LNG technology. Furthermore, the legal framework regarding safe storage, handling and bunkering of LNG needs to be harmonized since there are currently gaps and differences among various countries across the world (Aneziris et al., 2020).

6.3.4 Sermons for Sustainable Freight Transport

The third category of measures to promote sustainable freight transport is sermons. Sermons are the least restrictive type of measures since they do not force or push any behavior, but they rather suggest or recommend a specific behavior. Despite being less vigorous, these “soft” measures aiming for consciousness and understanding are rated as very important by the logistics companies (Pfoser, in press). The sermons category includes awareness raising activities as well as education and training.

Awareness building measures are relevant for all three types of sustainable freight transport. In context of horizontal collaboration, awareness for the positive effects of commonly operating transport and sharing logistics resources with partners must be in place (Plasch et al., 2021). Many stakeholders are hesitant to collaborate because they do not fully trust each other and refuse data exchange (Kurapati et al., 2018). A mental shift is needed for logistics companies to accept new types of collaborative transport (Pfoser et al., in press). Trust building measures are suitable to induce such a mental shift as they break up competitive thinking and suspicion among partners (Plasch et al., 2021). To promote multimodal freight transport, awareness building measures are also needed. Awareness raising campaigns (e.g. roadshows presenting successful business cases) should induce a mental shift in a way that logistics companies (especially shippers as “customers” of transport) start to regard multimodality as a viable transport option (Pfoser, in press). Importantly, awareness raising also includes managing customers’ expectations: Shippers are most often used to the fact that goods arrive within a short period of time, and for that reason many shippers dramatically reduce their stocks. This behavior makes it difficult to implement multimodal solutions, as these solutions need some lead time and are rather suited for large cargo volumes put into interim storage. Shippers must accept the need to plan ahead and allow for interim stocks to facilitate multimodal transport (Pfoser, in press). Finally, awareness must also be raised for LNG as alternative truck fuel. Information campaigns and the demonstration of this technology may encourage users to invest in LNG vehicles (Pfoser et al., 2018d). LNG roadshows allow visitors to test the latest LNG truck technology. Within these events, visitors are allowed to drive LNG trucks, and they also gain an understanding of operational and maintenance issues related to this alternative fuel. This helps to reduce their concerns as they obtain practical insights and get in touch with the new technology (Pfoser et al., 2018d).

Education and training measures aim to raise knowledge of sustainable freight transport and provide logistics companies with experience of new technologies and services they might not have used before (Pfoser, in press). This is of particular importance for the shift and improve strategies which both involve special equipment and operations that might be new for the logistics companies. For example, using LNG as an alternative fuel requires the handling of a cryogenic liquid, which might deter fleet operators to switch to LNG trucks (Anderhofstadt and Spinler, 2019). In fact, the extremely low temperature of LNG constitutes a hazard for humans and materials that get in contact with it (Aneziris et al., 2020). LNG fueling and storage also involve the risk of fires or explosions (Vanem et al., 2008). These hazards can however be avoided through proper training of the employees handling LNG. For example, driver training familiarizes truck drivers with the operation of LNG fueled trucks. These measures address logistics companies’ need for safety in transport (Pfoser et al., 2016a) and popularize LNG as viable fuel option. Also in the field of multimodal transport education and training can be useful, for example to teach operators how to perform multimodal transport efficiently, but also for example to increase knowledge on which funding schemes exist to receive financial support (Pfoser, in press; Pfoser et al., 2020).

6.3.5 Theoretical Support for the Identified Policy Measures

Based on the theoretical background presented in Subchapter 6.1, theoretical support can be provided for the identified policy measures. Figure 6.5 gives an overview of the theoretical implications that result for the identified policy measures using the theories introduced in Subchapter 6.1.

The use of monetary incentives to promote sustainable freight transport is supported by transaction cost economics. TCE teaches us that companies seek to reduce their transaction costs (Williamson, 1981). If the implementation of sustainable freight transport is subsidized, companies will incur reduced expenses and will be therefore encouraged to introduce sustainable strategies.

The resource-based view explains why infrastructure development and the adaptation of the legal framework are suitable to promote sustainable freight transport. According to RBV, resources are crucial to gain a competitive advantage (Barney, 1991). The natural resource-based view teaches us that pro-environmental practices may constitute a competitive advantage (Hart, 1995). Indeed, many logistics companies see sustainable transport as an opportunity to distinguish themselves from competitors (Pfoser, in press). It is therefore recommended to provide them with the required resources they need for sustainable freight transport. The resources that are needed to implement sustainable strategies include, for example, refueling infrastructure or multimodal terminals. Notably, resources are not always physical, but they may also constitute intangible framework conditions, such as the legal framework for sustainable freight transport.

The institutional theory gives indications of how information and transparency can be created within the transport system. As stated above, it is very important for stakeholders that the performance of a transport system (e.g. multimodal network or PI network) is monitored. This ensures that performance remains at the desired level and outcomes are satisfactory. However, transparency will probably not be granted automatically. Institutional theory (DiMaggio and Powell, 1983; Scott, 1987) suggests that coercive pressure is a suitable measure to dictate information and transparency. Coercive pressure constitutes the formal or informal constraints that are put on organizations (DiMaggio and Powell, 1983). These constraints are imposed by third parties upon which the organizations are dependent on, for example the legal regulatory system (Oliver, 1991). If regulatory authorities stipulate the monitoring of transport performance, stakeholders will have to obey. This will be beneficial for the efficiency (and thus the acceptance) of sustainable freight transport systems. Beside coercive pressure, another element of institutional theory can be borrowed for the development of policy measures, namely mimetic pressure. Mimetic pressure means that companies imitate the behavior of other organizations to avoid falling behind the technology leaders in their industry (DiMaggio and Powell, 1983). This mimetic behavior implies that pilot projects and business cases of pioneering companies in sustainable freight transport should be disseminated extensively to create mimetic pressure for others to follow the early adopters. The dissemination of pilot cases can be realized by information campaigns, roadshows or other awareness raising activities.

Awareness raising activities are intended to influence stakeholders in a way that they demand sustainable freight transport from their transport providers. The rationale for awareness raising measures is rooted in stakeholder theory and agency theory, which both explain the importance of stakeholders’ expectations for the realization of sustainable practices. Following stakeholder theory (Freeman, 1984; Donaldson and Preston, 1995), companies are prompted to implement sustainable strategies if their stakeholders exhibit environmental needs. Similarly, agency theory (Eisenhardt, 1989) assumes that if their principals require sustainable behavior, companies (as agents) are motivated to show environmental commitment. Due to the significant power of the stakeholders, it is advisable to set awareness raising measures which target the environmental consciousness of the stakeholders. As argued in Section 5.2.3, the transport customers are the most important stakeholders for logistics service providers. Awareness raising measures should therefore specifically target transport customers, but also all other stakeholders including the logistics companies themselves.

Theoretical support for education and training measures comes from the knowledge-based view. According to the knowledge-based view, knowledge is strategically the most important resource an organization may possess (Grant, 1996). Appropriate knowledge allows organizations to gain a competitive advantage. In view of sustainable freight transport, green intellectual capital is relevant to implement environmentally friendly transport services. Education and training measures are therefore required to create this green intellectual capital. Practical experience and knowledge will reduce reluctance towards sustainable freight transport (Lazuras et al., 2011).

Figure 6.5
figure 5

Theoretical support for identified policy measures

Full size image