Wal-Mart launches Sustainability Index

By dint of its sheer size, pretty much everything Wal-Mart does is important. So the long-anticipated launch of the Wal-Mart Sustainability Index — a company-led project to evaluate all of the suppliers whose products appear on Wal-Mart’s shelves — has met with a huge amount of scrutiny.

The first version of the index is a simple 15-question scorecard (available here) broken into four sections: Energy and Climate, Material Efficiency, Natural Resources, and People and Community. For example, here are the questions devoted to climate change:

> 1. Have you measured your corporate greenhouse gas emissions?
> 2. Have you opted to report your greenhouse gas emissions to the Carbon Disclosure Project (CDP)?
> 3. What are your total greenhouse gas emissions reported in your most recently completed report?
> 4. Have you set publicly available greenhouse gas reduction targets? If yes, what are those targets?

Pretty basic stuff, but having this information compiled in a single public database would be useful first step in evaluating the environmental impact of a huge range of products. However, product-level information is still many years off. For the time being, the scorecard focuses only on companies. Joel Makower comments:

> Do such shortcomings render the Walmart Sustainability Index as greenwash? No. This is a solid first effort. It’s important to note that over the past year, Walmart engaged some 20 universities, a handful of environmental activist groups, associations like Business for Social Responsibility, many of its key suppliers, and a small army of consultants. Patagonia’s iconoclastic founder, Yvon Chounaird, has played a role. It’s gone through a great deal of thinking and more than a few iterations. This was not some slap-dash effort.

Developing the Sustainability Index will be an iterative process, so the most important question regarding its future impact is really just how committed Wal-Mart is to developing, refining, and publicizing the information they gather. At the moment, they seem quite serious about expanding their ruthless pursuit of supplier efficiency to encompass greener goals.

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  1. Alex L - July 22, 2009

    Greenwash.
    I have to think that Wal-Mart’s actions are at the instigation of others. Wal-Mart is about profit and market share. I think they want to avoid criticism and public scrutiny so that they can continue selling at the levels they do and make tons of money for the Walton family.
    Would Wal-Mart itself pass any sort of Sustainability Index? No. By definition, this sort of huge mass-market machine runs rough-shod over the idea of buy locally, think globally.

  2. Mickey Booz - July 22, 2009

    This is fantastic! I’m proud to see Walmart leading the way to a sustainable environment. They are a shining example of what what the Real Estate industry is doing with LEEDS & Energy Star certified homes and the GREEN designation from the National Association of Realtors. Keep the momentum going and call me if you need help!

  3. Ed Heath - July 22, 2009

    I think my feelings are somewhere between the first two commenters. Walmart has made some moves toward providing green products to consumers for at least a year. It would be better if these evaluations were by product (as I assume they will be in the future), but it is nice to see what companies are doing while they manufacture products. I don

  4. john kurmann - July 22, 2009

    I’m not convinced the concept of a sustainability index makes sense. Such a project would require a huge amount of research to investigate all the ecological impacts of products throughout their entire lifecycle, yet that’s what you’d need to do for a sustainability index to be accurate. I think it would be better, whatever Wal-Mart does, for activists to focus on internalizing the true costs of production. A carbon tax or cap-and-trade system would be one step in this direction and could make a huge difference all by itself–if constructed wisely–because the impacts of our fossil use are so enormous.

  5. jeremy epstein - July 22, 2009

    From what i’ve understood, Walmart will use this index to rate their current suppliers, ones that do not meet a threshold for a certain level of sustainability efforts will no longer be suppliers.
    This is about using market forces to drive the market in a more sustainable direction. I believe that if Walmart uses this index to choose more sustainabe suppliers this is probably going to be one of the most important environmental actions to ever occur in places like China, where most of Walmart’s products are made. Losing their contracts with Walmart will have much more effect on the production processes of producers overseas and integration of a sustainable ethos into Chinese (among others) production facilities than any government led efforts ever could. Bravo to Walmart.
    We live in a world dominated by the corporation, lbeing local and other associated personal actions mean a lot once they hit a certain critical mass, but this takes time. Where real changes can occur quickly with maximum global impact is at the corporate level. Governments move too slow, individuals are just individuals, but corporations wield real influence and can change markets faster than any other entity. And aren’t markets the beast behind our massive consumption levels?

  6. Michele M. - July 22, 2009

    Greenwashing!
    Sustainably isn’t just about a carbon footprint, but the impact on the environment in regards to pollution, the ethical treatment of life forms (including the workers), reducing waste and consumption (not what Wal-Mart’s about), and growing and making things locally to decrease the carbon footprint on goods.
    Wal-Mart continues to have items made in China and abroad with poor working conditions and wages. Their superstores destroy small businesses, impact the natural environment (as all big box retail does) in a negative way, and is continuing to receive handouts on the backs of taxpayers, including paying for food stamps and Medicaid for their underpaid workers.
    This is not sustainable!

  7. Michele M. - July 22, 2009

    Jeremy,
    Your comment saddens me. You have just announced that individuals have no voice and can’t produce change. You believe that corporations can create faster and more positive change. It was the people that have pressured Wal-Mart into changing.
    Let’s look to history: Who got women the right to vote? It wasn’t the corporations or the government. The government was pressured by women for a hundred years for the right to vote.
    Who addressed civil rights injustices? Many people of many colors did and pressured the government to change.
    Who pressured the government to put tighter regulations on pollution in the 1970s? It definitely wasn’t the corporations. It was the people.
    There are hundreds of other examples. Corporations are here to make money…a profit. If it means making them look environmentally friendly to make money then by all means. Wal-Mart is not.
    The day we say that individuals don’t count in this country and that “corporations wield real influence and can change markets faster than any other entity” is the day we give up democracy and give into fascism.

  8. Jeremy epstein - July 22, 2009

    Michele,
    I am a firm believer in the power of personal change, my lifestyle proves that and I have committed to a life working for a more sustainable world.
    And let’s also be clear that I personally don’t even shop at Walmart.
    That being said, Individuals have all of the power in the world. In fact, isn’t Mr. H Lee Scott an individual? Just one individual who has come to see the business case for sustainability, namely that there is no business on a dead planet, and consumers are going to increasingly demand safe, fair, environmentally friendly products. He is just one individual who happens to have the world’s third largest company at his fingertips. So yes, I believe in the power of the individual, and I applaud that those individuals wielding more power than most developed nations make serious efforts toward making their operations sustainable.
    Mr. Scott has dedicated Walmart toward 20% lowered GHG emissions over the next 7 years, doubling organic food offerings and reducing waste by 25%. What Walmart does, others follow. Find me a government out there (the same government that responded to people’s pressure for women’s suffrage) that has committed to any such measurable reductions in such a short period of time and can actually make them happen without years of bureaucratic quibbling.
    Corporations are here to make a profit, but once they stop serving the people, they cease to make a profit, thus they are as responsive if not more so to public pressure than governments.
    As an individual, I applaud the efforts being made by Walmart, though I do not support them financially, my words hopefully do mean something, after all, I’m an individual in a democratic nation just as much as you or Adam Stein or Rosa Parks ever was, and I certainly believe in the power of the individual.

  9. john kurmann - July 22, 2009

    Jeremy:
    Would you prefer that Wal-Mart make no changes to the way they do business? Would you prefer they keep the same rapacious business model?
    I haven’t shopped at a Wal-Mart in years except for going in there to buy some Ben & Jerry’s ice cream while visiting my Mom & sister in Fulton, Missouri, which doesn’t offer many other shopping choices, but I applaud the fact that they are seeking to change the way they do business. I don’t think the sustainability index is going to prove to be workable, but they’ve already had a significant impact through their pressure on suppliers to reduce packaging and their efforts to reduce energy use. All of this is a sign that a different worldview is working its way through our culture, but you can’t expect it to transform everything overnight.

  10. Gracie Duggan - July 23, 2009

    This maybe a good start, but, it does not change the amount of merchandise imports. China exports 10% of all their exports to Wal-Mart. Just because Wal-Mart makes a sustainability index does not change that they carry these products and they import most of the products they sell. If, Wal-Mart truly care about the environment, they would stop importing so much.

  11. goeco - July 23, 2009

    Any step in any direction to sustainability by anyone is great in my book!

  12. Jeremy E - July 23, 2009

    John,
    Did you mean to direct your comments to Michele? I’m all for the moves being made by Walmart.
    GoEco,
    That’s what i’m talkin about! baby steps. Rome wasn’t built in a day, and it takes a long time to turn the titanic. Although having worked in government, it takes even longer to turn bureaucracy than it does to change a private company.

  13. Brenda - July 24, 2009

    You don’t know beans I work there. Walmart is big on environment. We recycle everything.

  14. skeptic - July 25, 2009

    The real question, as others have said, is what the consumer is going to do with the SI data if it’s presented to them. My guess: not much. We already know that Walmart is 95% junky plastic Chinese imports, we shop there anyway. We already know it shuts down small, local, sustainable businesses that can’t compete financially, we shop there anyway. We already know it’s on the low end for worker treatment and quality of life, we shop there anyway. We already know it’s been known to bet against its employees by taking out secret life insurance policies on them. We shop there anyway. We already know it has questionable business practices as far as emerging world exploitation, depletion of resources, enormous environmental impact from transporting goods, and wantonly s***ing on the environment by seeking out countries that have much less stringent environmental standards, and We Shop There Anyway. Walmart is unethical, it shrugs and admits it, AND WE SHOP THERE ANYWAY. What difference is a Sustainability Index going to make?

  15. Jim - July 26, 2009

    Wal-Mart is a reflection of America, like it or not. Wal-Mart is who we are, double XL clothing aisle and all.
    Ultimately, there is no such thing as a perpetual-motion machine. Everything is born, lives, and then dies. And our time on earth will end as well. This is the cycle of life and their just ain’t no getting around it.
    The sad thing is that we don’t seem to be able to muster the political will to do anything to even begin to soften the impact.

  16. Carol - July 29, 2009

    The former head of the Sierra Club, now works for Wal-mart, probably creating this sustainability Index (SI). Walmart made tremendous strides in attempts to change their enviromental impact. China realized the need to protect the environment, and is now ahead of the US on this effort. They are not there yet,but they are creating their own windfarms, and not buying ours. We have the advantage of being local on the SI, so shipping costs in money and environmental impact are less within the US. If we can produce products locally to compete with the Chinese, then Walmart will stock them. Remember, all China’s products must be shipped, a long distance. But can we do this? Here is our opportunity.