Wal-Mart Reports Sustainability Progress

BENTONVILLE, Ark. — At its 2012 Sustainability Milestone Meeting here this month, Wal-Mart Stores executives defended the company against charges that it has failed to meet its sustainability goals, and pointed out areas where it is making progress.

“I’d rather set a stretch goal that we’ve got to work hard to achieve rather than set an easy goal anybody can do,” said Mike Duke, Wal-Mart’s president and chief executive officer, at the meeting. “We don’t always know the path to get there but we’re going to go after our goals.” Wal-Mart’s environmental goals include being supplied 100% by renewable energy and creating zero waste.

Last month, the Institute for Local Self-Reliance, Minneapolis, delivered a wide-ranging critique of Wal-Mart’s sustainability progress in a report called “Walmart’s Greenwash,” but Duke referred to a number of milestones reached by the company, such as diverting more than 80% of all waste from landfills.

He noted that the company has increased the amount of locally grown produce it sells by 97% and that more than 10% of all produce sold in U.S. stores is locally grown. Wal-Mart recently released its 2012 Global Responsibility Report, in which it described its progress on the sustainability front.

Duke said that all Wal-Mart employees, including him, would be evaluated in part by “what did you do this year in the area of sustainability.”

Wal-Mart executives also commented on the company’s three-year-old sustainability index, or scorecard, for the products it sells, which has been the target of criticism pointing to slow progress. They said the company has piloted its scorecard across nine or 10 categories over the past year and plans to roll it out this year to another 100 categories across its U.S. businesses.

“We will go to cereal and apparel, and we’re looking at hardware, electronics and toys,” Duncan Mac Naughton, chief merchandising/marketing officer, Walmart U.S., said at the meeting. Moreover, in 2013 “we’re going to spread [the scorecard] across the entire categories,” he said.

In addition, Wal-Mart is planning to soon launch an “incentive plan” incorporating sustainability progress for its buyers and merchants, and will recognize suppliers who are supporting the program as well as meet with suppliers “who aren’t doing so well,” Mac Naughton said.

Wal-Mart has been collaborating with the Sustainability Consortium, Tempe, Ariz., on category sustainability profiles, whereby suppliers are ranked by their sustainability progress, with actionable recommendations given to merchants for collaborating with suppliers, said Linda Hefner, chief merchandising officer, Sam’s Club, at the meeting.

Though focusing on the category level, Wal-Mart intends to ultimately provide more information at the product level, said Andrea Thomas, senior vice president, sustainability, Wal-Mart, during a conference call after the meeting. “It’s natural to start at the broader category level, where you can impact more products in the short term,” she said. “In the long term, providing information for consumers is still within the scope [of the program].

The category-level analysis allows Wal-Mart to focus on “sustainability hot spots within those categories” and rank suppliers “based on information they provide us around those hot spots,” said Thomas. Wal-Mart is not making supplier information or rankings public, she added.