Is Walmart the planet’s best hope?
By Wayde Bull, Planning Director at Principals.
Walmart, the world’s most powerful retailer, is funding the development of a new consumer-friendly sustainability index it plans to apply to every product it sells worldwide.
In a wake-up call to its 100,000 global suppliers, Walmart has begun to request sustainability data from each and every one of them. 15 blunt questions are asked about greenhouse gas emissions, solid wastes, water usage, raw materials sourcing, quality processes, ethical production safeguards, community investments – and plans to improve on all of the above.
As if that weren’t enough to focus the minds of manufacturers, Walmart has flagged its ultimate aim; to create a worldwide sustainability metric that can be shared with consumers on individual products, just like a nutrition label. What form the measure will take is still being resolved. It might be a number, a grade or a colour-coded system.
It’s clearly a huge practical and political challenge to simplify such a complex concept down to a simple metric. So Walmart has chosen to partner with powerful friends. The Sustainability Consortium comprises elite universities and think tanks, the US Environmental Protection Agency, packaged goods leaders like Procter & Gamble, Pepsico and Unilever, plus Microsoft and Google, no doubt eager to take the index online.
Walmart is effectively underwriting the development of an open-source sustainability measure that it doesn’t aspire to own or control. In fact, one of its noble aims is to convince arch-rival retailers like Target and Costco to also embrace the index. Rand Waddoups, Walmart Director of Sustainability said recently “we want this to turn into something that is far bigger than Walmart. You have to call on the world to develop the effort, so they have ownership of it.”
It’s a remarkable example of public and private enterprise teamwork, galvanised by a powerful market player with the will –and the leverage – to turbo-charge change. Some argue that Walmart is better placed than governments to drive the pace of the sustainability agenda today, given its uncommon influence across so many industry supply chains, across nations.
It’s all a part of what Walmart describe as “looking for leadership” and creating a further competitive dynamic between suppliers that will “create a race to the top”. Environmental analysts Inhabitat caution that it might take years to arrive at a fair and informative consumer rating system, but if broadly adopted, the Walmart-initiated index could easily have as much impact as a cap and trade carbon program.
Given such slow political progress on local climate change legislation, despite sustained public support for action, it will be intriguing to see if our own powerful retailers sense competitive advantage in driving the sustainability debate from the front.
If Walmart succeed in their efforts to create a simple sustainability measure that’s bigger than themselves, it’s only a matter of time before it finds its way here. Let’s hope major Australian retailers and manufacturers see merit in joining Walmart’s push for transparent sustainability measures – and help to shape them.
First published on AFR (www.afr.com) - 1st October 2009
