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The Disruptors: Sustainable Saving at Walmart

April 15, 2015 by Judith Magyar 0

Walmart’s unprecedented pledge enables sustainable shopping.

When we’re filling our baskets with Easter eggs and chocolate bunnies we seldom think about where they came from: Where did the cocoa come from? Was the water on the farm well managed? Did the farmers use pesticides? What were the social conditions of the workers?

These questions are easily answered if you’re shopping online at Walmart. You just need to look for items marked with the Sustainability Leaders badge to easily find the companies leading in sustainability. Thanks to an unprecedented pledge made 10 years ago by the CEO of Walmart, today over 10,000 items sold by the world’s largest retailer are marked with this badge.

Three ambitious goals

In 2007, Walmart’s CEO announced three aspirational goals related to advancing environmental sustainability: 1) Walmart would be supplied by 100% renewable energy. 2) The company would create zero waste, and 3) that Walmart would sell only products that sustain people and the environment.

It soon became apparent that with the right engineering and operational transformation, the first two goals, while audacious, were achievable. It would be just a matter of time. It was the third goal that stumped them. Back then there was no definition of “sustainable products.” There was little insight into the chemical components in a product or what environmental impacts might arise from its production. No one could see into the supply chain of a specific product to understand the social conditions and health hazards the workers faced.

Rising to the challenge

To address this issue, Walmart helped found The Sustainability Consortium with the mission to develop a science-based, sustainability measurement and reporting system for the consumer goods industry. The consortium includes manufacturers, retailers, suppliers, service providers, NGOs, civil society organizations, governmental agencies and academics, each bringing valuable perspectives and expertise. Their vision is a world where science advances a new generation of innovative products and supply networks that address and improve environmental, social, and economic imperatives.

In addition Walmart established the Sustainability Index program, a powerful tool that is helping Walmart understand, monitor, and enhance the sustainability of its products and supply chain. And lastly, they established the Sustainability Hub, which clearly outlines steps suppliers can take to help Walmart reach its sustainability goals.

SAP’s online collaboration network

Walmart has committed to buying 70% of the goods it sells in the U.S. only from suppliers that use the Sustainability Index to evaluate and share the sustainability of their products by 2017.

To power the index, Walmart chose SAP Product Stewardship Network and is now able to reach over 700 merchandising categories, a substantial portion of its business. Walmart product buyers and key global sourcing leaders now have specific sustainability objectives tied to their annual evaluations. The resulting supplier scorecards are helping both buyers and suppliers understand the key issues and opportunities in their businesses and are revealing the next steps that can be taken for improvement.

Next time you buy chocolate, check out the sustainability insights of the cocoa in the product. In fact, you can get these insights on all items available in the Sustainability Leaders shop, listed by category.

Happy sustainable shopping!

The Disruptors is a series of short stories of customer innovation from around the world. Read more stories from The Disruptors series.

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