STOCKHOLM (BLOOMBERG) – Sweden’s biggest companies are looking for ways to stay away from the polluting skies.
A phenomena known as flying shame, which has more and more Swedes shunning airplanes, is spreading to business travel, adding to woes for an industry already hit by the rise of video conferencing and other digital solutions.
A Bloomberg survey with responses from 21 of the 29 companies listed on Sweden’s benchmark index reveal that they are shifting more travel to trains, promoting more online meetings and also seeking to offset air travel with carbon-dioxide fees. About half explicitly said they expect their air travel to decline in the coming years, and none foresee an increase.
For carriers such as SAS AB, which rely on business travel for a big chunk of their profit, it’s a troubling development.
Mobile operator Telia Co requires employees to take the train if the trip is below 500 kilometres, putting a flight between Gothenburg and Stockholm, Sweden’s two biggest cities, off limits. Atlas Copco AB advises employees to choose rail travel “unless there is a significant difference in travel time.” Svenska Handelsbanken AB, one of Sweden’s biggest banks, says “aviation should be avoided, as far as possible, in favor of trains.”
The Nordic region’s largest bank, Nordea Bank Abp, which requires staff to always consider video meetings or conference calls as alternatives, has reduced air travel between its Nordic offices by 21 per cent since 2017. It aims for a continued annual reduction of 7 per cent until 2021.
ABB Ltd, the Swiss-Swedish engineering giant, puts 1.8 per cent of the ticket price of all air flights made by its employees into an energy-saving fund. Swedbank AB introduced one flight-free week per month throughout the group last year.
The bid to reduce air travel by employees goes hand in hand with many companies’ bid to crack down on costs.
Sweden, the home of climate activist Greta Thunberg, has become a pioneer in the notion that there’s shame connected with traveling on airplanes that guzzle fossil fuels. Sweden’s main airport operator, Swedavia, has seen passenger traffic drop for 12 months straight, partly driven by flying shame. It could be a sign of what’s to come across the world.
At the same time, Swedish state train operator SJ has cited “the big interest in climate-smart travel” as the reason for last year’s record of 32 million passengers.
SAS hasn’t seen as dramatic slowdown as Swedavia on its domestic flights, according to Freja Annamatz, a spokeswoman. Annamatz acknowledged that the climate debate in Sweden “does of course affect the market” even though SAS doesn’t know just how big that effect is.
SAS does inform its frequent fliers that it offers climate compensation and the potential to buy extra biojet fuel, she said.
Here are examples of actions taken by Swedish companies:
“ABB in Sweden applies an internal CO2 fee of 1.8 per cent of the ticket price of all air flights made by its employees. The travel documents also include a statement on how much CO2 the flight caused. The revenues from the carbon fee go directly to the company’s Energy Saving Fund.”
• Atlas Copco
“Our travel policy states that CO2 emissions should be taken into account when employees choose modes of transportation, and that employees as far as possible should conduct meetings via video link.”
“We aim in general to limit travel & when choosing the travel method consider security, environmental impact and cost.”
“We plan to reduce emissions from business travel in order to reach our goals, even though it is a challenge for a global company that is dependent on meeting customers. Reduced emissions from business travel is, however, necessary if we are to reach our targets.”
At Essity, employees are asked to firstly opt for digital meetings. When there is a need to travel, train and public transport is the preferred mode of transport.
“Business travel will be necessary in the future as well, but only in the last year, Getinge has reduced air travel by 19 per cent, globally. We believe that trend will continue, albeit not at the same pace.”
“Employees are encouraged to choose the most environmentally friendly mean of transportation when booking travels, and use public transport as far as possible.”
“If air travel is the only possibility, we require that the carrier can provide emission data for the trip so that we, in turn, can determine what direct effect our activities have on the environment.”
• Investor AB
The company has a policy containing recommendations for environmentally friendly alternatives and is currently updating that travel policy given the climate debate. It’s also using climate compensation for air travel.
“Nordea has decreased the number of flights between Nordic headquarters by 21 per cent from 2017. We have set the target to further reduce number of flights by 7 per cent annually until 2021.”
“In May 2019 we announced our new sustainability targets for 2030, which includes halving the CO2 emissions over the lifecycle of our products. Travel is one factor that we are looking at in this context.”
“The climate benefit of SCA’s operations is about 8 million tons per year, which equals emissions from all domestic flights and truck transports in Sweden.”
The bank has a travel policy that requires environmentally friendly travel as part of efforts to cut CO2 emissions. After lowering emissions by 54 per cent between 2008 and 2015, SEB aims to reduce them by 20 per cent between 2016 and 2020.
“The need for travel shall always be assessed and digital meetings should replace physical travel as much as possible.”
“Skanska is an international company and there will continue to be a large need for travel between countries and continents. However, the conditions for long-distance meetings are constantly improving, at the same time as rail connections are developing in many places. That could mean less air travel.”
“Travelers should prioritize environmentally friendly options, and train travel should always be chosen over air travel if it doesn’t increase the total travel time by more than one hour.”
“In early 2018 we introduced a flight-free week per month throughout the group and that has resulted in less travel and less emissions.”
• Swedish Match
“For domestic travel, the first-hand choice is rail, as it is the most environmentally friendly, and often the most cost-efficient, alternative.”
“Our focus is on prioritizing digital communication over travel.”
“Since 2001, Telia has cut air travel by 80 per cent, which means that we have reduced CO2 emissions by 90 per cent and costs by about 80 per cent.”
• Volvo Group
“Volvo Group has a policy for travel and meetings that requires employees to choose the travel option that entails the lowest possible CO2 emissions.”