Sustainability progress report 2013

MOVING
TOWARDS
SUSTAINABILITY
progress report 2013
2
“IT IS THE NATURE OF OUR BUSINESS
TO SERVE CUSTOMERS WHO
WANT TO HAVE ACCESS TO FAR
FLUNG PARTS OF THE WORLD.”
Damco Sustainability progress report 2013
CONTENT
INTRODUCTION5
ABOUT DAMCO
6
ABOUT OUR SUPPLY CHAIN
7
LOGISTICS INDUSTRY SUPPLY CHAIN TRENDS
8
SUSTAINABILITY STRATEGY AND GOVERNANCE
10
PERFORMANCE AT A GLANCE
12
OUR PEOPLE
14
CARE HEALTH AND SAFETY
LABOUR PRINCIPLES
16
16
18
NURTURE19
TRAINING AND DEVELOPMENT
19
EMPLOYEE ENGAGEMENT
20
RESPECT24
GENDER DIVERSITY
25
NATIONALITY DIVERSITY
25
CLIMATE AND ENVIRONMENT
ENERGY EFFICIENCY
SUSTAINABLE LOGISTICS
28
29
30
OUR VALUE CHAIN
32
RESPONSIBLE PROCUREMENT
33
ANTI-CORRUPTION34
SUPPLY CHAIN SECURITY
35
ABOUT THIS REPORT
36
SUSTAINABILITY PERFORMANCE TABLE
38
3
4
“HAVING SUSTAINABILITY AS AN INTEGRATED
PART OF OUR BUSINESS BUILDS VALUE FOR DAMCO,
AS WELL AS FOR OUR CUSTOMERS, OUR EMPLOYEES
AND OUR COMMUNITIES.”
Damco Sustainability progress report 2013
INTRODUCTION
Damco has set its course to build the logistics company for the 21st century
amid the ‘new normal’ established after the 2008 economic crisis. The tailwind
of automatic growth of exports from Asia to the US and Europe can no longer
be assumed. Research shows there will, however, still be a lot of growth – but it
will be focused around rapidly growing cities, especially in emerging markets.
Trade patterns will gradually move to new regions and industries.
Demand for efficient logistics services is increasing in these
new markets as they gain in affluence. We are adapting to
these changes to ensure consistency in the quality of our
products and services for our customers.
Even in the most challenging markets, our customers,
employees and consumers expect responsible business
behaviour at every step of the supply chain. Our commitment
to sustainability means we implement our high standards and
values equally everywhere that we do business. We also aim
to increase transparency about how we operate, and see this
approach as a source of competitive advantage.
Partnership
Addressing the many challenges in emerging markets requires
collaboration among diverse stakeholders. This is why the
foundation of our sustainability strategy is a partnership
approach. By joining with others in industry, government,
and civil society, we can have greater impact. For example,
as part of the Maersk Group we are a member of the UN Global
Compact LEAD Platform and collaborate with other business
units and companies to share best practices. In the Clean Cargo
Working Group, we help set accurate industry standards for
measuring our customers’ international supply chain carbon
footprint. In the World Economic Forum’s Partnership Against
Corruption Initiative (PACI) we work with industry peers, NGO’s
and authorities to promote responsible business practices.
By participating in collective action we have a greater impact in
alleviating fundamental bottlenecks of trade and development.
Since we rely on many third-party suppliers, we are setting
clear policies and targets in key areas such as responsible
procurement, anti-corruption, and health and safety.
It is the nature of our business to serve customers who want
to have access to far flung parts of the world. As an asset-light
company, the success of our business lies in the knowledge,
skills, and networks of our people. That’s why we are investing
heavily in training and development to ensure our standards
are applied universally.
We have made steady progress in these areas. However,
sustainability is a journey rather than a destination. We need to
do more work, particularly in the areas of procurement, energy
efficiency, and diversity. We also need to continue to reinforce
a culture of safety in all our operations.
I am proud to have joined Damco in 2014 and I look forward
to taking part in moving Damco ahead. Having sustainability as
an integrated part of our business builds value for Damco, and
also for our customers, our employees and our communities.
Hanne B. Sørensen,
CEO, Damco
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6
ABOUT DAMCO
From single shipment to supply chain management solutions
Forwarding
Clearance
Ocean, air and land-based services
Supply chain
In-house & Third Party Customs Clearance
Visibility
Supply chain management, warehousing and distribution,
supply chain design and optimisation, supply chain ‘greening’
Process
Visibility from single shipment to item level supply chain management
Process and KPI management through leading operational and unique IT infrastructure
Damco is one of the world’s leading providers of supply
chain management and freight forwarding solutions.
We offer integrated end-to-end logistics services and
manage some of the world’s most advanced supply chains.
Damco is part of Maersk Group, and services over 10,000
customers globally ranging from large multinationals to smaller
independent importers/exporters and local businesses.
Global logistics, individual solutions
With tailored solutions for different industries, Damco supports
customers that are active in notably retail, lifestyle, chemicals,
hi-tech, industrial manufacturing, mining, government and
defense, aid and relief, and perishables.
Every industry has its own specific logistics requirements and
needs, and we have an extensive network of on-the-ground
specialists in all corners of the world to help customers with
their supply chain and transport requirements.
Global and local experts
Both global and local Damco experts, who understand
specific businesses and their individual logistics needs,
enable customers to cut inventories, reduce operating costs
and meet market requirements. Significant savings are
recognised annually by our customers as a result of partnership
with Damco on supply chain development projects.
About the business in 2013
With 11,400 employees in 300+ offices located in about
100 countries, Damco managed in 2013 2.8 million
TEU of ocean freight and supply chain management
volumes and 225,000+ tonnes of air freight.
Damco Sustainability progress report 2013
ABOUT OUR SUPPLY CHAIN
Damco services
Freight Forwarding
Customs & Trade
Compliance
Warehousing &
Distribution Solutions
Supply Chain Visibility
& Control
Supply Chain
Management
• Airfreight
• Ocean freight
• Customs clearance
& brokerage
• Warehousing services
• Distribution services
• Inventory management
and control
• Sea-air
• Road
• Rail
• Multi-Modal
• Project cargo
• Cargo insurance
• Customs inland
transportation services
• International trade
document management
• Export and import
distribution centres
• Cross-docking and
transloading
• Re-packaging, labeling
& kitting
• End-to-end supply
chain visibility
and management
• Import and export
flow management
• Vendor connectivity
solutions
• Online bookings
• Document
management
• Track & Trace
• Milestone exception
management
Damco offers choices of modes and carriers by stitching
together the many services of different specialist providers,
including trucking, rail and barge companies; export, import
and customs clearance companies; airport and container
yard handling companies; container shipping and airfreight
companies; and warehousing companies providing
consolidation, deconsolidation, transload and storage services.
Damco does not own and operate the many different kinds of
transport and warehousing assets involved in supply chains.
Consequently, key sustainability issues for Damco relate to
supplier management, including corruption risks, responsible
procurement, and health and safety. 
• Origin Consolidation
Management
• Distribution centre
by-pass and direct-tostore programs
• Multi-country
consolidation
programmes
• Load optimization
• Vendor Management
• Dynamic Flow Control
• Control Towers
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LOGISTICS INDUSTRY SUPPLY CHAIN TRENDS
The growing complexity and dynamism of
supply chains requires increasingly advanced
information technology solutions.
Meeting consumer’s requirements at multiple
locations with multiple transport modes at different
times requires a flexible supply chain that can
adapt easily to unexpected circumstances.
Customers increasingly prefer products that
are made - and sourced - in “the right way” at
destination as well as origin, minimising business’
social, economic and environmental impact
on society and enhancing positive effects.
Information technology
Flexibility
Sustainability
LOGISTICS INDUSTRY
SUPPLY CHAIN TRENDS
The logistics industry is changing rapidly, and Damco aims to serve
our customers by identifying and adapting quickly to market trends.
International, mature and emerging markets have
become a part of the overall business growth
strategy for many companies. Going “international”
has become the standard and logistics solution
providers need to enable that trend.
Globalisation
Manufacturers continuously search for supply
chain innovations and gains through partnerships
with logistics service providers.
Supply chains are becoming increasingly
complex and dynamic with sourcing
locations being changed increasingly
quickly and purchase orders becoming
smaller and more frequent.
Partnerships
Complexity
9
End-consumers increasingly source via multiple
channels, ranging from brick & mortar shops to
e-commerce. The logistics industry needs to support
the multi-channel strategies of their customers.
Multi-channel sourcing
To be able to secure “speed-to-market”
and to reduce risk of delays, alternative
transport modes and routes are required
to support the continuing trend of
outsourcing logistics services.
Continuity
As labour costs in Asia and transportation
costs rise, increasing amounts of manufacturing
are being brought closer to the end user.
Near shoring
Anti-bribery and corruption legislation is having an
increasing impact on supply chains. Multinational
companies demand that no facilitation payments are
made during the export of their goods, yet still seek to
source from low-cost countries, which are often also
at the bottom of Transparency International’s global
corruption index.
Compliance
Urbanisation
End-to-end visibility
Growth patterns
Economic and population
growth will be increasingly
centred in cities.
Complete visibility of the entire supply
chain aspires to achieve true
demand-driven planning, allowing
efficient response to changes in sourcing,
supply, capacity and demand.
Growth in the logistics industry is no longer driven by
exports from Asia to North America and Europe. It will
come from elsewhere, and will be more unpredictable and
volatile, with infrastructure becoming a major determinant.
10
SUSTAINABILITY
STRATEGY AND
GOVERNANCE
Amid the changing trends in logistics, Damco aims to use our vast reach and
end-to-end logistics expertise to balance economic, social and environmental
concerns in global supply chains for the benefit of our customers, employees,
shareholders and society.
Our strategy, which is guided by the Maersk Group’s
membership in the UN Global Compact LEAD platform, is to
integrate sustainability into all of our business processes,
position ourselves as a responsible partner, and make
sustainability a competitive advantage. We are held accountable
both by Maersk Group and our global leadership team for
progress in key areas that are important to both our business
and our stakeholders. We actively engage with our
stakeholders in an open dialogue to stay aware of the latest
trends, challenges and opportunities related to sustainability.
Damco contributes to a dashboard twice a year on the
basis of a self-assessment, which measures the progress
of sustainability integration according to our current strategy.
The dashboard shows Damco is making good progress in
all areas, especially integration into strategies, management
systems, and stakeholder engagement.
Governance
Damco established a Sustainability Steering Committee in
2013 to facilitate collaboration on sustainability issues among
various business functions and develop a unified ‘tone from
the top’ on sustainability issues and priorities. The Steering
Committee, which meets quarterly, consists of the Chief
Commercial Officer, Chief Operating Officer, Head of Human
Resources, and Head of Sustainability. Key priorities are
signed off by the Steering Committee as well as the Global
Leadership Team consisting of the global CEO and CEOs
of our regional divisions.
Moving forward, the steering committee will review progress
on sustainability targets regularly as well as the implementation
of policies and objectives in regional operations.
To facilitate implementation of global objectives in local offices,
a member of each of Damco’s Regional Leadership Teams
will take on the role of sustainability coordinator in 2014. This
will ensure sustainability issues that cross various functional
responsibilities will be communicated in a coordinated fashion.
Damco, as a business unit of Maersk Group, must meet the
requirements of various Group rules, policies and guidelines
related to sustainability. The Group’s Sustainability Council,
consisting of CEOs of Group business units, oversees
strategy and coordination. The Group’s Executive Board
is responsible overall.
Training Tools
We also provide management and employees tools to enhance
their knowledge of sustainability, including sustainability
e-modules which are integrated into pre-work to leadership
courses. The course is available to all employees through our
Learning Management System. Additional online courses are
available for managers requiring knowledge in specific issue
areas such as anti-corruption and responsible procurement. 
Damco Sustainability progress report 2013
Maersk Group
Our sustainability
governance framework
Group Executive Board
Responsible Overall
Group Sustainability Council
Business Unit CEOs oversee strategy and coordination
Commitments
Our Values:
constant care, humbleness,
uprightness, our employees,
and our name.
Our Group Rules,
Policies and Guidelines
UN Global Compact
LEAD
Damco
Sustainability Steering Committee
Chief Commercial Officer
Chief Operating Officer
Head of Human Resources
Head of Sustainability
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Damco Sustainability progress report 2013
PERFORMANCE
AT A GLANCE
Damco regularly tracks performance of several key sustainability issues
Health
& Safety
LTIF
Damco achieves a low
12 month average
Lost Time Injury
Frequency (LTIF) and
zero fatalities by
maintaining an open
and alert culture.
Everyone has a role
to play in ensuring
our operations are
incident free.
Target 2013
Actual
performance
Target 2014
0.46
Responsible
Procurement
Suppliers
Registered/
Assessed
Damco relies on the
services of many
third-party suppliers.
Our responsible
procurement program
aims to ensure they
adhere to our
Third Party
Code of Conduct.
Registered
Assessed
(10% reduction)
335 55
0.42
Registered
(18% reduction)
Assessed
296 19
maintain low LTIF and
ZERO
fatalities
Registered
Assessed
500 116
AntiCorruption
Employees
trained
To address corruption, we identify risks;
develop policies and
frameworks; train
at-risk employees;
engage stakeholders;
and participate in
global initiatives to
develop solutions.
90%
of high and medium
risk employees
receive training
75%
of high and medium
risk employees
completed online
or in-person training
90%
of all employees will
receive online
anti-corruption training
Damco Sustainability progress report 2013
Environment
Carbon
Training
Damco is
implementing
energy efficiency
initiatives at our
network of facilities
in an effort to
reduce our CO2
emissions.
Diversity
Gender
Nationality
Damco is increasing
productivity and
improving service to
customers. We are
implementing
a global forwarding
operations platform,
Kewill, and conducting
extensive training to
provide a uniform
customer experience.
Damco believes that
a diverse and
inclusive workforce
is essential for us to
constantly challenge
our ways of working
and thinking.
Female Employees
GM
-21% 2000
(2009 base)*
employees trained in
2011 - 2013
-30% 1435
CO2 reduction
employees train
on Kewill platform
*IFRS treatment of joint venture enterprise reporting changed
in 2013 and is applied retrospectively, resulting in environmental
performance of JVs being removed from final figures.
Director
Non-western Nationals**
GM
Director
23 18 36 23
% % % %
Target 2015
28 16 42 23
% % % %
**Gender and nationality diversity based on headcount
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OUR PEOPLE
Damco Sustainability progress report 2013
Damco is a service provider, which means we have few physical assets
and rely on people to manage the operations which meet our customers’
requirements. Without people, we have no business; and this is why we have
adopted policies which care for, nurture and respect Damco employees.
This section explores each aspect of this approach.
Health, safety and security
Nurture
Labour principles
Care
Training and
Development
Employee Engagement
Gender Diversity
Nationality Diversity
Respect
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16
CARE
HEALTH AND SAFETY
As our business grows in markets where existing norms
in health and safety may not always meet international
standards, we are faced with the challenge of ensuring that
all our employees are sufficiently trained to uphold Damco’s
values and standards. Since we rely on third-party suppliers,
we also strive to ensure these contractors maintain our
high standards.
Damco aims to provide a professional Health and Safety
management system with a consistent global approach to
give our customers the confidence to choose our services.
This confidence can be further enhanced by third-party
supplier audits.
Health & Safety Responsibilities and Reporting
Everyone at Damco has a role to play in ensuring that
our operations are incident free. We have inculcated
a responsibility culture, through training and reporting
lines to the top of the organisation. Damco has a Health
and Safety Policy, which is signed by the Damco CEO.
The global Health and Safety team is empowered to oversee
and support the company-wide adherence to a growing list
of industry, customer and legislative requirements. The team
reports directly to the global leadership, which allows for
effective reporting and support.
We aim to provide our employees with an environment free of
health and safety incidents. Acting beyond the minimum legal
obligations to do no harm benefits not only our business, but
also our employees, our customers, our business partners
and the communities in which we operate. In general, the
highest potential for accidents in our operations occurs in our
warehouses. However, most of our employees work in office
environments, where the potential risks are more limited.
In all environments, experience and best practice shows that
an open and alert culture is needed to manage health and
safety risks effectively. Collaboration, open reporting and
active dialogue are required among many stakeholders;
this is how we live our value ‘Constant Care’.
Health and safety policy, signed by CEO
Global leadership team
Global head
of strategy
Global Health & Safety team
Global HS
manager
Regional
HS manager
Region #1
HS manager
Region #3
HS manager
Region #2
Country
Country HSS
Delegate
Country HSS
Delegate
Country HSS
Delegate
Country HSS
Delegate
Country HSS
Delegate
Employees
HSS training completed by all employees at induction
Country HSS
Delegate
Damco Sustainability progress report 2013
Preventing Injuries
Damco’s safety focus has been reflected over the years in
our ability to reduce and maintain our Lost Time Incident
Frequency (LTIF) at low levels, Damco improved on our 2012
LTIF of 0.51, reaching a new low of 0.42 in 2013, a reduction
of 18%. Given the very low number of incidents, a change of
even one incident in a quarter would have had quite clear
effects to the LTIF.
In 2014 we aim to maintain our current low LTIF by focusing
all employees on risk awareness and preserving a sense of
vulnerability. We will establish a ‘near miss’ reporting and
investigation system to create more awareness of preventative
measures. Near misses are incidents where no property is
damaged and no personal injury sustained, but where, given
a slight shift in time or position, damage and/or injury could
have occurred. Recognising and addressing near misses
can have positive effects on reducing LTIF and fatalities,
and provide a safer working environment. We will begin with
a selective rollout, as this will require that our staff overcome
the reluctance to report such incidents, which might be
wrongly perceived as failure.
Responsible Handling of Dangerous Goods
We are also enhancing our competence in dangerous goods
management by establishing online support and an internal
training manual supported by external training to ensure our
employees are able to professionally handle and process
this category of shipments.
Next Steps
• We are establishing a common software platform
with a unified global approach to the processing
of dangerous goods.
• We are developing global standardised training
to ensure our competence in handling dangerous
goods and chemicals.
• Continued focus on sub-contractor and partner
management, an area that requires constant review.
• Maintain our current low level of LTIF and zero fatalities
in 2014.
Damco’s Health and Safety Commitments
1. To prioritise Health & Safety as a core pillar within our business and decision-making processes
2. To take a systematic approach towards Health & Safety management and
to achieve compliance with applicable laws, regulations, and industry standards
3. To continuously monitor performance, encourage and facilitate reporting of incidents
4. To instil a culture of awareness, participation and continuous improvement
in all aspects of Health & Safety, through active and regular training
5. To live the Constant Care principle by taking care of today and thus actively preparing for tomorrow
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LABOUR PRINCIPLES
Defined by Damco’s parent company – Maersk Group – our
Labour Principles are our commitment to providing positive,
productive and supportive working environments where all
employees are valued and inspired to be the best they can be.
The Principles are based on the UN Global Compact’s
framework and applied with the aim to make the company
a good place for employees to work worldwide.
All managers within Damco have a duty to enact these
Principles and our Human Resources team is responsible for
overseeing and supporting their implementation. Employees
have the opportunity to report violations of the Principles,
either through their line management and HR, or via the
Maersk Group whistle-blowing system.
The Principles ensure decent and fair labour conditions for all
our people and provide systems and processes for employees
to raise concerns about their workplace. We believe they help
reduce the risk of workplace disputes, and they enhance our
ability to attract the talent we depend on throughout the world.
The Global Labour Principles reflect our commitment to the UN
Global Compact, covering collective bargaining, discrimination,
child labour and forced labour, as well as health, safety and
security, working hours, compensation and fair procedures. 
Damco Sustainability progress report 2013
NURTURE
TRAINING AND DEVELOPMENT
Damco is transforming the way in which the company operates
to increase productivity and improve service to our customers.
This effort affects the locations where specific functions are
performed and the specific people performing them. In line
with this global program, Damco has also identified a general
need to improve collaboration across the organisation.
Damco’s transformation program will be supported by
development activities in areas such as sales, operations,
and customer services. Training programs are being
implemented or defined to cater for these needs.
Staff development is overseen by global functional leaders
with support from human resources, which designs and
implements the programs.
Rolling Out a New System
Damco has to date grown organically and through acquisitions.
Our next wave of growth will be designed around delivering
scalable and innovative solutions for our customers’ needs.
One of the growth initiatives to constantly improve the way
we serve our customers is to implement a global forwarding
operating platform, called Kewill, allowing colleagues involved
in freight forwarding to operate in a more modern way.
The platform, which is being implemented through 2014,
will provide a uniform customer service experience with
Damco from anywhere where we operate.
Developing Talent
800 employees trained in China
alone by the first quarter of 2014
Target:
1435
Performance:
2000
employees train
on Kewill platform
2014
employees trained
2011
2012
Emerging markets, a key area of growth,
have been a core focus of our training.
2015
We continue to build and develop our talent pipeline at all
levels. We have:
• The Damco International Graduate Programme
(DIGP), which is a two-year entry-level training
programme to attract, develop and retain new graduates.
At this stage, 62 graduates have been enrolled into the
programme. The graduate programme is in its second
year but already all participants are deeply engaged in
projects of strategic importance to Damco.
The programme provides the graduates with deep
insights into the dynamics of global logistics and
prepares them for junior management positions.
• The two-year ‘IMPACT’ programme develops
commercial middle management talent. A total of
40 employees are selected each year. The programme
provides deep insights and capabilities in driving
commercial excellence and prepares participants for
mid-level commercial management roles.
• The one-year Global Talent Programme (GTP) for our
senior management, with 59 talents presently enrolled.
Participants are handpicked by the regional CEOs after
having demonstrated stellar performance, as well showing
the potential to assume higher roles in the next two to four
years. The programme focuses on developing the
participants’ personal and people leadership capabilities and
includes mentoring by Global Leadership Team members.
• All mid-level leaders are offered a multitude of development
activities, most notably the Group wide leadership courses
called ‘Leading Others’ and ‘Leading Leaders’, which
focus on enabling leaders to make the transition onto a new
level of responsibility.
• Our 120 senior-most leaders are completing two Damco
Way of Winning modules at the renowned international
business school IMD in Lausanne, Switzerland from
September 2013 to March 2014. The programme is
tailor-made to align our senior leaders around our strategic
objectives and to deepen their collective understanding
of the key enablers to succeed.
2013
Next Steps
• We will train 1435 employees on the Kewill platform
in 2014 and continue to build our talent development
programmes.
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EMPLOYEE ENGAGEMENT
Employee Engagement Survey
Each year we conduct an Employee Engagement Survey.
All employees are asked to complete the Survey,
anonymously and online, and answer questions on topics
such as management effectiveness, job satisfaction, team
dynamics, our values, and sustainability. All employees are
invited to workshops to discuss their team’s survey, and are
engaged in determining what should be done to improve
the level of engagement.
In 2013 our Employee Engagement index fell to 70 from 73,
thus ending a trend where engagement has improved over
the last number of years. Lower scores were found across the
organisation and within all survey categories, and is consistent
with results seen across the Maersk Group.
The reasons for the lower scores vary across our organisation,
but it is clear that our internal transformation and subpar
business performance have had some impact and have led to
some uncertainty in our organisation that in turn has affected
our general engagement level.
Our ambition is to turn the negative results back into a positive
trend next year. Good leaders are a key prerequisite for
sustained strong engagement. In 2014 we will further
strengthen our leaders’ capabilities to drive our internal
transformation and improve performance through people.
We also expect to see improved engagement as the effects
of our internal transformation take hold in our organisation.
Besides improving customer satisfaction and productivity
markedly, the programme will also enable our employees
to better serve their customers and will significantly reduce
non-value adding work.
Engagement through CSR
Damco has several ‘Corporate Social Responsibility’ activities
which we believe are not only a prerequisite to be a corporate
citizen, but also present opportunities to engage our
employees and communities.
Our activities include our participation in Logistics Emergency
Teams, and volunteering and fund-raising for communityfocused initiatives.
LOGISTICS
EMERGENCY
TEAMS
When natural disasters strike, infrastructure is often damaged
or destroyed. This increases the need for logistics expertise to
ensure that essential supplies reach the needy and destitute.
Damco employees are well-qualified, with extensive logistics
know-how, to contribute their skills to a disaster response.
Damco, as part of Maersk Group, is a member of the
humanitarian Logistics Cluster’s Logistics Emergency Teams
(LET) initiative, led by the UN World Food Program (WFP). The
LET provides support during the first three to six weeks of a
disaster to assist in laying the foundation for sustained supply
chain management in the area.
Damco is an active member of the steering committee of
the LET, where we contribute to the strategic direction of the
partnership. This entails monthly calls and biannual meetings
with senior leaders of the World Food Program to develop
strategy and plan our involvement. The LET is also an
employee engagement opportunity for Damco – our
employees are proud to be part of such a large-scale
Damco Sustainability progress report 2013
humanitarian project, where their industry expertise can
help society. A team of Damco experts is trained and on
standby for participation.
Supporting the Philippines Typhoon Relief
In 2013, Typhoon Haiyan in the Philippines caused unparalleled
damage and destruction in the Central Philippines with an
estimated death toll of more than 6,000. For the survivors of this
tragedy, there was no food or water, no telecommunications or
power, and no discernible roads to get help where help is needed.
In response to the typhoon, the WFP and the Logistics Cluster
activated the LET. As part of the partnership, the Maersk
Group, including Damco, offered probono logistics services
and personnel with local knowledge on warehouse
management, ports, barges, and customs clearance.
The Group also launched a donation site where employees
globally could contribute to the International Federation of Red
Cross’ work in the Philippines. Funds raised through the site were
matched by the Group as well as the A.P. Moller Relief Foundation.
Disaster Preparedness
The LET also worked on disaster preparedness by contributing
to Logistics Capacity Assessments in Rwanda and the
Dominican Republic in 2013. In these assessments, teams look
at infrastructure components such as roads, bridges, ports and
airports. Their findings are used to map out disaster contingency
plans that facilitate the movement of humanitarian aid. 
Next Steps:
• Damco is committed to further engagement in the LET
in 2014 and will participate in deployments and logistics
capacity assessments as needed.
• We are determined to engage more employees by building
communication about this partnership and the importance
of logistics expertise after natural disasters.
• We will also focus on increasing our impact through local
initiatives that meet the criteria of our key themes.
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Around the world Damco employees often take
the lead in responding to local community needs.
Our colleagues proactively organise donations of skills
and resources based on five key themes which we believe
are aligned to our core competences and values.
These include: Disaster Relief & Preparedness, Empowering
People to Trade, Environmental Protection, Health & Safety,
and Education & Training.
Damco Sustainability progress report 2013
BELGIUM - Damco promotes diversity in Belgian warehouse
Damco Belgium promotes diversity by training low-income, immigrant and mentally disabled workers
for a potential career in warehouse logistics. Damco partnered with Levanto, an organisation which helps
disadvantaged people develop life skills, to take on six trainees to work in warehouses during peak periods.
GERMANY/GHANA - Damco sponsors container for midwives in Ghana
Damco Germany sponsored a 40’HC container of medical supplies and equipment for a midwives clinic in
Have, Ghana. Damco coordinated the transportation and handling of the container from Cologne to Have.
Ghana has one of the highest maternal mortality rates in the world.
DENMARK/BENIN - Damco ships hospital beds to Benin
Damco Denmark aided Global Medical Aid in coordinating probono transportation of donated hospital
beds to Benin, where there is only one hospital bed per 1,000 people. Damco provided warehousing and
consolidation services in Denmark and shipped 14 containers of beds to Benin, where the local team
transported the beds to the hospitals.
JAPAN - Damco delivers relief goods by air for CSR project
Damco Japan signed up in December 2013 to deliver relief goods by air for a UNIQLO Corporate Social
Responsibility (CSR) project in collaboration with UNICEF via Jordan to Syrian refugees. The project covers
over 3,000 cartons (240 cubic meter or 25 tons) of down jackets, shirts, baby goods and other daily needs.
US - Damco Chicago donates to Food Drive
Employees in Chicago took part in the nationwide United Way Food Drive Campaign, a drive that ensures
people in crisis receive the resources they need. By organising a competition between departments,
the office managed to gather more than 1,000 food items within a week.
CHINA - Damco Chengdu donates to children
Damco Chengdu organised a donation drive to support children in remote mountainous areas with
winter clothing. The drive benefits the poor in 5 different regions around Sichuan.
CAMBODIA - Damco Cambodia staff donate blood
21 Damco Cambodia employees donated blood at the National Transfusion Centre to support patients
in public hospitals.
PANAMA - Damco Panama partners with University
Damco Panama provided internships for undergraduates from Universided Tecnologica de Panama to learn
about logistics and freight forwarding. Damco organised lectures on logistics solutions, hub infrastructure
advantages, continuous improvement supply chain solutions. Damco hired 10 students after the internship.
CHINA - Damco China creates logistics education
Damco established a joint programme with the Sichuan Vocational College of Architecture and Denmark
VIA University College to promote logistics education. The partnership will improve resources and training
facilities, help build an local logistics talent pool.
US/AFGHANISTAN - Damco supports Afghan winter clothing drive
Damco partnered with Dyncorp International to support the Afghan-American Women’s Association
Winter Clothing Drive, where winter clothing and monetary donations are sent to needy areas in Afghanistan.
Damco coordinated the entire logistical process, shipping more than 40 boxes of winter clothing and
supplies probono.
CHINA - Damco Chengdu supports earthquake victims
Damco Chengdu provided relief aid to Ya An, after the city was hit by a 7.0 magnitude earthquake. Damco
donated 515 sets of new school uniforms and 500 books to Lushan Shenglong Center School. Damco
also created a three-year plan to support library renovation, city and company tours for students, and
volunteering services by Damco employees.
CHINA - Damco Chengdu supports local talent
Damco Chengdu annually recruits 25 interns from more than 20 universities in Sichuan province during
the summer. Interns undergo a one week tailor-made training program and learn communications,
problem solving and presentation skills.
CHINA - Damco Shenzen supports post-earthquake reconstruction
Damco Shenzhen sponsored a local Charity Bazaar in support of the post-earthquake reconstruction
of Ya’an. More than 10 employees raised funds by selling second-hand articles.
CHINA - Damco Shanghai staff support handicapped children
Shanghai employees visited the Bo Ai Children’s Centre with toys and other gifts. The centre helps about
forty children with cerebral palsy, autism and other learning difficulties. To raise funds, paintings made by
the children are presented for auction during the company’s annual dinner.
CAMBODIA - Damco Cambodia supports needy
Damco Cambodia sponsors Buckhunger, a non-profit organisation that provides free meals to more than
200 children and the elderly in Phnom Penh each day. Employees have also donated old clothes,
used books and toys.
SINGAPORE - Damco Singapore supports handicapped in charity run
55 employees from Damco Singapore participated in a charity run to support the Singapore Association
for the Visually Handicapped (SAVH).
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24
RESPECT
We believe that a diverse and inclusive workforce is essential
for us to be able to constantly challenge our ways of working
and thinking, to enable us to recruit our fair share of talents
in the market, and to respond to evolving challenges and
understand a varied customer base. Diversity is looked at
through a multitude of lenses – e.g. nationality, ethnicity,
age, gender, and education; in short, we think our differences
make us stronger. To achieve this diversity we provide a
non-discriminatory workplace for employees to enjoy and
respect one another’s individuality. Our Labour Principles
include our commitments against discrimination.
Our own benchmarks point to Damco performing quite
well on both gender and nationality diversity relative to our
competitors, but our ambitions go beyond our existing level.
Diversity
The trends and opportunities related to diversity at Damco are
shaped by two legacies:
• We are based in The Hague, The Netherlands, and have
operations in more than 90 countries.
• Traditionally, the logistics industry has been male-dominated.
Our focus is on increasing the mix of nationalities and balancing
the gender representation within our global operations.
Damco Sustainability progress report 2013
GENDER DIVERSITY
NATIONALITY DIVERSITY
Overall, our workforce is 50 per cent female, but on closer
analysis, there is less balance in management and leadership
positions, 23 per cent of general managers and 18 per cent of
directors being female, based on headcount. We have a talent
pipeline plan to increase the number of women in management
and leadership positions over the next five years, and we have
defined ambitious 2015 and 2018 diversity targets.
Two-thirds of our white-collar employees work in growth
markets. We constantly seek the right balance of localisation
at management and leadership levels; we need experienced,
internal hires to bring Damco’s expertise to new markets just
as much as we need local hires who best understand the
local markets.
Damco aims to increase the number of female General
Managers to 28 per cent by 2015 and reach 35 per cent
female representation by 2018. For Directors, the targets
are 16 and 25 per cent respectively.
We have consciously made an effort to invest in hiring and
developing local talent. As a result, we have a healthy pipeline
of international employees, with 36 per cent of staff being
non-western* at the general management level, and 23 per
cent at the director level, based on headcount.
As part of Damco’s Global Diversity Strategy, five female
Damco employees participated in the ‘Strategies for Success’
training program in Europe and Asia,
We will continue to monitor our diversity performance and
review our hiring and training practices to ensure each Damco
employee enjoys a workplace free of discrimination. 
Level
Senior management
Level
Non-western nationals
2013 actual
General Manager
Director
2013 actual
General Manager
Director
2015 target
23%
18%
2015 target
36%
23%
2018 target
28%
16%
2018 target
42%
23%
35%
28%
50%
30%
which provides tools for career planning, networking,
and developing self-awareness as a leader. Three female
managers took part in the annual global Women’s
International Networking Conference. The conference
is designed to inspire women to reach the next level in
their careers.
*Non-western defined as countries excluding: United States, Canada,
Australia, New Zealand, Japan, Austria, Belgium, Bulgaria, Cyprus,
Czech Republic, Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta,
Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain,
Sweden, United Kingdom, Norway, Switzerland, Monaco,
Liechtenstein, Iceland
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26
DIVERSITY
Change makers of the world
Patricia Pretell joined Damco straight out of university in 2008.
Whilst Damco’s volatile market has sometimes made it hard
for her to foresee a clear career pipeline, she has built up
her career working in both Latin America and China.
In 2013, while working as a regional account manager in
Latin America, she was chosen as one of Maersk Group’s
14 delegates to the One Young World Summit, an external
development opportunity given to young growth market talents.
‘’The summit was one of the most inspiring experiences
I have had. It really helped me to be much more aware
of what are the world’s problems and how do they
affect business and societies.”
Patricia Pretell, Regional Programme Manager,
Latin America, represented Damco at the One
Young World Summit in 2013
In Patricia Pretell’s opinion, Damco is making a big effort to
make the management team more diverse, including more
non-Danish people, but says “there’s still some way to go.”
At the summit she took inspiration from Muhammad Yunus,
Bangladeshi banker, economist and Nobel Peace Prize recipient.
“I liked when he said ‘we have the power inside us,
and we just have to believe in that power to be
change makers of the world.’ That’s exactly
what I am trying to do.”
Damco Sustainability progress report 2013
China: a new approach to keeping women engaged
The logistics industry in China is populated mainly by women.
This is also true for Damco’s three main offices in China. More
than 70% of employees are women working front line jobs as
well as management positions, especially in customer service
functions. Women represent around 30% of the salesforce.
With many female employees, the company is exposed to
the challenges of a society where organised care for young
children is hard to find. Often, the only option for women
with family is to withdraw from the labour market.
The cost of women leaving
This was true in Damco’s Shenzhen office, where 400 employees
provide logistics services to small and major brand clients for
shipments via Shenzhen. Every year, 5-10% of the female
employees have a child. In 2011, 15 women did not come
back to work due to the lack of child care options.
Members of the Shenzhen
Babycare Project team
Hiring and training new staff added more than USD 15,000
to the company’s expenses. And the hidden cost of rebuilding
relationships with clients was even greater.
Answer: relieving the worries
Since 2011, Damco Shenzhen has given special attention
to this challenge, and offered employees not only flexible
working hours but also a resource sharing programme on
qualified child care (e.g. a pool of vetted nannies, agreement
with a near-by kindergarten, on-site lectures on child care
and development).
With an investment of approximately USD 5,000 per employee
every year, the number of mothers leaving their job has dropped
to three women in 2013; an 80% decrease in two years.
The programme has been extended to other locations
in Damco’s China network.
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28
CLIMATE AND
ENVIRONMENT
Damco can reduce adverse environmental impacts both within our operations
and by offering innovative products and services. This is evident with our two
main environmental initiatives: energy efficiency and sustainable logistics services.
Damco Sustainability progress report 2013
ENERGY EFFICIENCY
Damco has improved carbon efficiency by 21% compared with
the 2009 baseline and has a five-year target of 30% by 2014.
Our energy efficiency initiatives in the US are driven by Damco
Distribution Services (DDSI), which has been providing warehousing
and transportation solutions in North America since 1982. DDSI
has a network of facilities and transportation hubs and manages
3.9 million ft2 (>362,000 m2) of warehouse space. In 2013, DDSI
handled volumes equivalent to over 270,000 containers.
and automated sorter), fulfilment (traditional and ecommerce),
consolidation, value added services, facility and yard
management, port/ramp drayage, and inland transportation,
including Over the road (OTR), rail, Less than Container Load (LTL).
DDSI’s extensive services and North American footprint present
opportunities for sustainable practices and energy efficiency.
Our teams constantly innovate to improve not only what we do,
but also to do our part to have a positive impact.
DDSI offers a wide range of warehousing and transportation
distribution services including: transload, cross-dock (manual
Lighting
The lighting required for nearly 4 million ft2 of warehouse space
is significant, as is the opportunity to introduce more efficient
lighting systems. We have reviewed and improved the fixtures
and fittings in our facilities and achieved the following efficiencies:
In our new Queensborough, British Columbia, facility in
Canada, we included additional design features, such as
skylights and white walls, to maximise and reflect natural light,
rather than rely on electric lighting. 
Innovation/Change
Replaced high bay and overhead lights in the warehouse with
compact T5 fluorescent lights and occupancy sensors
Replaced low bay overhead lights with compact T5 fluorescent
lights with only 3 lamps per fixture and occupancy sensors
Replaced halogen lamps with flexible, low
input LED lights at the dock doors
Replaced 450W yard lamps with 168W fixtures
Location
Chesapeake 1 South Gate
Romeoville, Queensborough, Elwood, Sumner
Energy Saving
Chesapeake 2
South Gate
30%
South Gate
Elwood
63%
South Gate
Average
79%
63%
Vancouver
Queensborough
Sumner
Elwood
Romeoville
Toronto
Harrisburg
Oakland
Newark
Chesapeake
Carson
Carson 2
Carson 3
Southgate
Jurupa Valley
Long Beach Nova
Atlanta
Jesup Savannah
Baytown
Dallas
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30
Outside of North America, Damco Indonesia increased
warehouse energy efficiency and reduced costs by replacing
the standard mercury lamps with energy-saving LED lights.
We have also conducted energy audits at three sites in China
and one site in Poland and are developing plans for energy
efficiency measures there.
Smartway
Launched in 2004, SmartWay® is an US Environment Protection
Agency program that reduces transportation-related emissions
by creating incentives to improve supply chain fuel efficiency.
DDSI is a proud participant in the Smartway Transport
Partnership, in which freight carriers and shippers commit to
benchmark operations, track fuel consumption and improve
performance annually. SmartWay presents information on
carriers in eight separate emission metrics and 4 emittants.
Carriers fill out a SmartWay Tool to calculate their emissions
at a fleet level. Each fleet is intended to represent an identifiable
business unit that a carrier’s customers can discern and track.
Truck, rail, logistics, and multimodal carriers submit their
Carrier Fleet Tools to Smartway for evaluation and approval.
The SmartWay Transport Partnership helps freight companies
improve fuel efficiency, increase environmental performance,
and increase supply chain sustainability.
Information Technology
DDSI’s information systems provide visibility and flexibility to
our customers, allowing them to know where all of their freight
is in the supply chain to make correct decisions, reducing the
need for additional moves later in the supply chain.
The flexibility inherent in the systems allows customers to react
to sales trends, weather patterns and other situations affecting
sales by location to ensure optimal inventory at each store
locations. This also reduces the need for additional moves.
SUSTAINABLE LOGISTICS
We believe an efficient supply chain is a sustainable
supply chain
As an industry first mover in providing sustainable logistics
solutions, we focus on providing our customers with carbon
visibility solutions and improving the efficiency of supply chains
to remove waste and reduce cost and carbon.
Waste Management
We have invested in various waste management and recycling
measures at our facilities, to reduce, reuse and recycle
materials. For example, an on-site baler at our Southgate
facility allows us to reduce the volume of waste sent to landfill,
by compressing our cardboard, plastic and paper waste.
We recycle waste stretch wrap plastic at all our US facilities.
Stretch wrap is used to protect goods on pallets, but it
occasionally needs to be removed to examine the
goods within. Rather than let it go to waste, we recycle it.
Cutting Carbon, Cutting Costs
At Damco, Sustainable Logistics projects share two
commonalities: visibility and partnership. Our global teams
of Supply Chain Development analysts provide customers
with experienced resources to improve supply chain and
environmental performance through customised carbon
reporting tools, expertise on how to integrate sustainability into
logistics decision-making, and recommendations for increased
efficiency. Through our SupplyChain CarbonCheck,
SupplyChain CarbonDashboard, and Packaging Optimisation
services we find that in logistics, cost and carbon are
correlated at 1:1 – if we can reduce carbon by 1%,
we can reduce cost by 1% (see graphic on next page).
Another by-product of our operations is pallets; we collect
broken pallets on our sites and they are recycled and
made into a variety of products by our partners.
Managing our energy footprint requires vigilance and
innovation, and we seek new ways to operate which
will lessen, or mitigate, our impact.
Progress through Partnerships
Damco has been providing sustainable logistics solutions to
our customers since we first launched our carbon reporting
capabilities in 2008. Since then we have developed a ‘best in
class’ supply chain carbon methodology which was verified by
the Massachusetts Institute of Technology (MIT) and utilises
Damco Sustainability progress report 2013
the best available CO2 emission factors for transportation.
Through our active participation in the Clean Cargo Working
Group (CCWG) we are able to utilise carrier-specific trade
lane emission factors for ocean transportation, providing
our customers with the most accurate carbon calculations
possible. For all other logistics activities, we use the best
publicly available emission factors.
We put these skills to work in practical ways. One example
is an analysis of routes-to-market from Portugal. Under the
existing operation, goods were being delivered using road
transport and cargo consolidation. After reviewing supplier
locations, volumes, potential ports of origin and destination,
Damco identified a solution with the potential to reduce cost
and carbon by more than 50% simply by shifting the mode
of transport from road to ocean and conducting cargo
consolidation at origin.
As well as enabling our customers to improve the environmental
performance of their logistics operations, Damco actively fosters
strong industry and academic partnerships to advance the
agenda of sustainable goods movement. In addition to our active
participation in CCWG, we have ongoing engagement with our
partners in the other transportation modes, such as air freight,
to develop transparent and comparable CO2 emission factors.
This comparability will enable our customers to better
understand the environmental impacts of their logistics
procurement decisions. Similarly, Damco has built on our
partnership with MIT to establish strong links with the academic
institutions leading the UK Low Carbon Shipping initiative
(Newcastle University, University College London, Plymouth
University, the University of Hull). In particular, Damco is working
with Newcastle University to analyse the impact of alternative
routes-to-market, which have the potential to significantly reduce
carbon impact and cost.
The Future of Sustainable Logistics
But sustainability is not just about reducing costs, it is also
about preparing for the future of business operations and
considering impacts from all facets of the value chain. Leading
corporations, such as Marks & Spencer, view sustainability
as a source of innovation and make it a priority to integrate
these principles into their business decisions. Not only can
sustainability secure a competitive advantage for companies,
but it can help decouple profitability from rising resource and
service costs. Damco is committed to being a strategic
partner with our customers to capture the economic and
environmental benefits of logistics sustainability. 
Identified reductions
Distribution
network
optimisation
CO2
Transport
mode
optimisation
Transport
carrier
selection
Equipment
utilisation
improvement
-6.4%
-3.6%
-2.4%
-0.4%
-11%
-1.4%
-0.5%
-0.4%
-12.8%
Cost
-13.3%
Origin
End customer
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32
OUR VALUE CHAIN
Our business model means that we are ‘asset-light’ and we rely on the services of
third-party suppliers. We have a Third Party Code of Conduct, to which we ask our
suppliers to adhere. We make it clear that neither we nor our customers are willing
to pay for products and services produced under unfair, damaging conditions.
Damco Sustainability progress report 2013
RESPONSIBLE PROCUREMENT
Third Party Code of Conduct
Our Third Party Code of Conduct is based on internationally
recognised standards in the areas of anti-corruption, human
rights and labour, health and safety, environment, and on our
commitment to the ten principles of the United Nations Global
Compact. The same principles are applied internally in the
Maersk Group through our Group Policies. Our efforts in
Responsible Procurement are based on the methodology
of continuous improvement, which means we collaborate
with our suppliers to create awareness, transparency,
and commitment.
Our aim is for Responsible Procurement to become integrated
in all procurement categories, and to achieve this we need
consistent and strong central coordination. This activity is
led by our global head of procurement, who in turn reports
to Damco’s Chief Operating Officer. Progress updates of
our Responsible Procurement programme are included
in monthly procurement reports.
Our intention is to embed the principles of Responsible
Procurement in our operations. In working with our suppliers,
we follow a phased approach:
• Engagement: communicating our Third Party Code of
Conduct to suppliers and informing them about the next
steps in the RP process
• Registration: the supplier is on-boarded to our online RP
system and shares information about their sustainability
practices
• Formal assessment: takes place for selected suppliers where
we review their sustainability practices against the Code and
identify areas for improvement
These charts show our supplier activity levels in 2013.
Damco responsible procurement with suppliers
Achieved
Ensuring Responsible Procurement throughout our supplier
management is a long-term journey. Our current focus is on
transparency of current supplier performance. The next stage
will include identifying improvement opportunities and driving
them. And we will encounter challenges along this journey;
for example, some smaller suppliers only have basic levels
of business literacy and responsible procurement programme
understanding, which presents an obstacle to effective
implementation. On-boarding of these suppliers requires
vigorous effort and attention to ensure effective
implementation.
296
335
19
Registered
Progress to Date
To be effective, our Responsible Procurement programme
must be understood by Damco employees; training of
procurement staff is crucial to making sure Responsible
Procurement is embedded in our processes. In 2013, we
trained over 60 staff. In addition, in some countries, such as
Vietnam, procurement managers extended training seminars
to suppliers, broadening the reach of Responsible Procurement.
Target
55
Formally assessed
Next Steps
• All regional divisions will have Responsible Procurement
targets in the plans for 2014.
• Damco will include a Responsible Procurement clause
in new and existing (where possible) contracts
• In 2014, along with engaging more suppliers, our focus
will shift to assessing suppliers’ practices against our
Code of Conduct and plan audits where appropriate.
• Selected countries will have dedicated strategies
for proactive supplier engagement.
• Our target is to register 500 suppliers in 2014
and assess 116.
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34
ANTI-CORRUPTION
Transparency International, the global anti-corruption NGO,
published a report1 in October 2013, which said, “As emerging
market companies expand their influence they should seize
the opportunity to play a bigger role stopping corruption
internationally.” Epitomising this sentiment, Damco has a clear
zero-tolerance policy on bribery, on which we regularly brief
our employees.
Training for Anti-Corruption
We assess the roles and responsibilities of all employees and
classify the corruption risk facing each individual when they do
their job. To mitigate corruption risk, we trained 75% of our
high- or medium-risk employees either in person or online in
2013, compared with a target of 90 per cent, missing our goal
for 2013 due to delays related to company reorganisation.
We have observed that low-level corruption, particularly
involving customs clearance, is still a pervasive issue for the
movement of cargo into or out of a number of countries with
high corruption indices. And this presents a real challenge
for Damco; with a high frequency of interaction with low-level
public officials in such countries, Damco’s employees and
suppliers can be exposed to corruption risks. We have a
multi-layered approach to addressing corruption: we identify
risks; develop policies and frameworks; train at-risk employees;
engage stakeholders; and, participate in
global initiatives to develop solutions.
Resourcing to Ensure Compliance
In 2013, we hired five full-time compliance managers to provide
further compliance training and oversee all operations for
corruption risk. Damco held its first annual global compliance
conference for 30 senior compliance coordinators and senior
business leaders in 2013, and we plan to make this an annual
event. Compliance is now also a routine agenda item for the
meetings of our executive board.
Corruption risks
Employees
Suppliers
Actions
• Develop policies and frameworks
• Train at-risk employees
• Engage stakeholders
• Participate in global initiatives
to develop solutions.
Address corruption
Engaging Our Stakeholders
We engage proactively in frank and open dialogue with
our customers and other stakeholders about the challenges
in high-risk markets and possible collaborative solutions
such as the automation of port charges, duties and taxes.
Damco in 2012 became a member of the World Economic
Forum Partnership Against Corruption Initiative (PACI), and
meets with diplomatic and government officials in order to
flag issues and influence developments.
We also implemented a Compliance Charter, which clarifies
the roles and responsibilities for compliance in the company.
Ensuring compliance with Damco’s anti-corruption policy
has also been embedded as a standard part of our internal
audit program.
Next Steps
• Damco will focus on Third Party Due Diligence in areas
where our suppliers, such as customs clearance brokers
and trucking companies, are exposed to corruption risks.
• We plan online anti-corruption training of 90% of all
employees.
Damco Sustainability progress report 2013
SUPPLY CHAIN SECURITY
Security is a universal concern and in our business we are
faced with specific security challenges. Our approach is to
embed security requirements within Damco’s core processes.
Damco Supply Chain Security Policy
•To meet our customers’ security requirements utilising
modern, creative and cost-effective solutions, optimising
all resources available.
•To participate in and actively support regulatory initiatives
and voluntary partnership programs such as AEO4,
C-TPAT, TAPA5, ACAS6, in close collaboration with
business partners, customers and other stakeholders.
•To prioritise a Supply Chain Security Management
System as a core element of our business and decision
making processes.
•To promote a security culture throughout the organisation
by means of training and awareness programs.
We remain responsive and compliant to global security
initiatives and their application to both our operations and our
customers’, across all modes of transport such as: air, road,
rail and ocean.
In order to both support the global actions against terrorism
and ensure efficient customs clearance of our customers’
cargo to the US, Damco maintains a strong focus on
compliance with security initiatives such as C-TPAT2,
where Damco is C-TPAT validated.
Damco also participates in PIP (Partners in Protection)
developed in 1995, with a primary focus on promoting
business awareness and compliance with customs regulations.
PIP is a Canada Border Services Agency (CBSA) program that
enlists the cooperation of private industry to enhance border
and trade chain security, combat organised crime and
terrorism. Damco is PIP certified.
Damco also recognises other global programs such as
AEO and is certified in many countries within Europe.
Embedding Security in Operations
We provide our staff with clear guidance on global standards,
guidelines and tools, which aim to mitigate security risks.
Damco’s Supply Chain Security Management Program
manages the eight security requirements of the C-TPAT status.
With the acquisition of two air freight companies, we are
focusing on the implementation of air freight security measures
and growing our competence and network capabilities,
along with staff with specialised air cargo security skills. 
amco further participates in industry voluntary programs
D
such as BASC (The Business Alliance for Secure Commerce),
an international, voluntary initiative created to promote supply
chain security in cooperation with government agencies and
international organisations. We also engage TAPA3 standards
Next Steps
• A global supply chain security management programme
will be launched during 2014.
• Damco will build awareness about cargo security
requirements standards through internal communication
campaigns.
• We are expanding our internal audit program to ensure
continued C-TPAT compliance.
where and when deemed to bring value.
Rising to the Challenge
We have an overarching Security Policy, which clearly sets out
four principles of operation, and also put in place processes,
systems and initiatives which ensure that the policy is
embedded into our day-to-day business.
1
eport: ‘Transparency in Corporate Reporting:
R
Assessing Emerging Market Multinationals’
2
Customs-Trade Partnership Against Terrorism
3
Transported Assets Protection Association
4
Authorised Economic Operator
5
Transported Asset Protection Association
6
Air Cargo Advanced Screening
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36
ABOUT THIS
REPORT
This report describes the sustainability performance,
achievements and challenges of Damco’s global operations
in the period 2012-3. Where applicable, it includes targets
for 2013-4.
As part of Maersk Group, Damco contributes data to
a Group report every year, which is prepared using the
Global Reporting Initiative’s (GRI) G4 Sustainability Reporting
Principles as a guidance. This Damco report draws on the
principles of both GRI and the UN Global Compact.
Stakeholder Engagement
We want to build trust in our company by engaging in
open dialogue with key stakeholders on a regular basis.
These stakeholders include customers, employees, suppliers,
Group management and industry associations. Our aim is
to have a more structured and consistent approach to
stakeholder engagement, which will be an important part
of our approach and governance in the future. Key stakeholder
engagement activities in 2013 included:
Engaging employees
Our work in sustainability can potentially add to the company’s
attractiveness as an employer. In 2013, 66% of employees
viewed our employee engagement survey’s sustainability
dimension favourably. The dimension is used as an indicator of
how given managers are incorporating a sustainability mindset
(social, economic, environmental) into daily business decisions.
The score compared with 70% in 2012, indicating that further
work is needed in integrating sustainability awareness among
managers. Overall, 74% of employees felt that Damco is
making an effort to be socially and environmentally responsible,
compared with 77% the previous year.
Engaging with Maersk Group business units
In 2013 Damco participated in a Peer Review conference
together with several other business units of Maersk Group.
Each company presented its key sustainability challenges and
progress, exchanged ideas on how to address common
challenges and shared best practices for improvements.
Engaging external stakeholders
Sustainability is a priority for many of our customers,
particularly those in the retail and garment industries. As such,
sustainability was a key topic on the agenda of an annual
Global Account Directors workshop, with the aim of giving our
customer-facing managers the tools to show how we align with
our customers’ sustainability priorities and help meet their
objectives in this area.
Damco also participated in the Retail Industry Leaders’
Association Sustainability Conference in Orlando, Florida to
engage in dialogue with customers and industry leaders.
Damco Sustainability progress report 2013
With our focus on responsible procurement, especially in
emerging markets, Damco participated in the World Economic
Forum meeting in Myanmar to engage with government
and industry leaders on supply chain risks and opportunities
in the region.
The data for this report was provided by various departments
in the business and was overseen by the Global Head of
Sustainability. The report was reviewed by the Global Head
of Strategy, the Sustainability Steering Committee, and was
signed off by the CEO.
Damco’s participation in other issue-specific industry
associations is discussed in the related sections of this report.
Going Forward
Damco will be validating our assessments of material issues
through consultation with our internal and external stakeholders
throughout 2014 and will also apply the principles of a new
Group sustainability strategy, which will promote a unified
approach to materiality assessments going forward. 
Materiality
We use a combination of Enterprise Risk Management, direct
dialogue with stakeholders and Group-level stakeholder
engagement to establish our material issues. Given our assetlight business model, the issues of highest importance to both
our business and stakeholders relate to supplier management
and minimising our supply chain risks. This supports our
focus on addressing corruption risks and embedding
responsible procurement in our business practices.
As our employees represent our single biggest asset, other
issues that are considered important include labour practices
such as employee training, diversity and labour principles
and health and safety. Similarly, our focus on the environment
supports our customers’ carbon emission goals and
Damco’s energy efficiency improvement and cost reductions.
This report addresses each of these material issues in turn.
For queries about the report and its content, please contact:
Natalia Olynec, Global Head of Sustainability
[email protected]
37
38
SUSTAINABILITY
PERFORMANCE
TABLE
Damco Sustainability progress report 2013
Sustainability Report 2013
Social performance
Our employees
Number of employees
FTEs
2011
2012
2013
9,787
10,778
11,388
Gender (female/total)
% based on FTE
46
46
37
Women in leadership
% based on FTE
n/a
n/a
23
Employee engagement
%
73
73
70
0.88
0.55
0.42
0
0
0
2013
Safety
Lost time injury frequency (LTIF)*
frequency
Fatalities*
number
Environmental performance
Energy consumption
2011
2012
Fuel oil
1,000 tonnes
0
0
0
Diesel
1,000 tonnes
3
4
4
2
1
1
38
35
38
366,184
328,329
337,774
1,000 tonnes CO2 eq
37
35
35
CO2
1,000 tonnes
15
14
14
CH4
1,000 tonnes CO2 eq
0
0
1
N 2O
1,000 tonnes CO2 eq
0
0
0
HFC
1,000 tonnes CO2 eq
0
0
0
PFC
1,000 tonnes CO2 eq
0
0
0
SF6
1,000 tonnes CO2 eq
0
0
0
HCFC
1,000 tonnes CO2 eq
0
0
0
Natural gas
1,000 tonnes
Electricity
1,000 MWh
Energy consumption
GJ
Greenhouse gas (GHG) emissions
GHG emissions
Direct GHG emissions (Scope 1 GHG Protocol)
Indirect GHG emissions (Scope 2 GHG Protocol)
CO2
1,000 tonnes
22
20
20
CH4
1,000 tonnes CO2 eq
0
0
0
N 2O
1,000 tonnes CO2 eq
0
0
0
0
Other air emissions
SOx
1,000 tonnes
0
0
NOx
1,000 tonnes
0
0
0
VOCs
1,000 tonnes
0
0
0
Particulate matters
1,000 tonnes
0
0
0
Other resource consumption
Waste total
1,000 tonnes
5
5
5
– recycled (composting, reused, recycled)
1,000 tonnes
0
1
1
– solid (landfill, on-site storage, incineration)
1,000 tonnes
5
4
4
– hazardous (controlled deposit)
1,000 tonnes
0
0
0
Water consumption
1,000 m3
237
202
211
– surface water
1,000 m3
19
25
19
– ground water
1,000 m3
8
10
5
– rain water
1,000 m3
0
0
0
– municipal water supplies /water utilities
1,000 m3
210
167
187
Spills (oil)*
m3
0
0
0
Economic performance
2011
2012
2013
Revenue
USD million
2,716
3,229
3,212
Profit for the year
USD million
63
55
-111
Tax for the year
USD million
35
36
22
Electricity cost
USD million
5
5
6
Definitions, scope, comparibility, controls, etc. described in the sustainability accounting principles in the Maersk Group’s Sustainability Report 2013.
www.maersk.com/sustainability
* Operational scope
39
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