In this study we examine the role of environmental sustainability in
transport operations in Shipper-Logistics Service Provider (LSP)
relationships from the LSP perspective. The research questions posed are
as follows: What kinds of firm see environmental sustainability as a
component of competitive advantage, and why? How does environmental
sustainability manifest itself in firm operations, and why? What
pressures are there for environmentally sustainable development, and
why? What is the role of environmental sustainability in the selection
of LSPs, and why? Data was collected from Finland, using an exceptional
combination involving both quantitative and qualitative methods in a
survey (600 responses) and in firm interviews (15 LSPs). The findings
indicate that large, globally-operating shippers and carriers are the
most interested in environmental issues, partly because of external
pressures and partly because they see the greening of transport as a
potential source of competitive advantage. However, due to the lack of
widely accepted methods for measuring the environmental impact of
transports, companies cannot easily share the costs and benefits of
environmental initiatives between supply chain members nor use such
initiatives as marketing arguments to differentiate their offerings.
Therefore, environmental sustainability acts in practice more as an
order qualifier than as an order winner in the carrier selection
process. Despite this, it seems that environmentally proactive LSPs
financially outperform their less active peers. We therefore conclude
that environmental sustainability can be free, if it is integrated with
operational performance and cost indicators that boost competitive
advantage. Our study contributes to the intersection of GSCM and
logistics, particularly from the LSP point of view.