Environment & the World

Wednesday, July 19, 2006

Environmentalism at Wal-Mart

Filed under: Corporate Sustainability — Cathy @ 11:58 pm

Last week, Al Gore recently spoke at a meeting of Wal-Mart executives on sustainability. See
Gore and some other leading environmentalists (including Adam Werbach) are really working with Wal-Mart to try to get them to follow through on their environmental commitments. And Wal-Mart’s goals are quite lofty:

“Last October, Scott pledged to transform his sprawling company, which employs 1.8 million people worldwide and ranks No. 2 on the Fortune 500 list, into a lean green machine powered exclusively by renewable energy, producing zero waste, and selling sustainable products … He aims, for example, to reduce greenhouse-gas emissions at Wal-Mart’s existing stores and distribution centers 20 percent by 2012, and invest $500 million in environmental improvements each year.”

The whole idea of “greening” Wal-Mart is obviously highly controversial, since the very idea of an enormous transnational corporation that ships good all over the world and drives local competitors out of business seems antithetical to the idea of sustainability. But, on the other hand, there is little indication that Wal-Mart is going to go away any time soon, probably not in the next couple of decades that will be crucial to solving the climate problem. And the economies of scale that would come from Wal-Mart moving towards sustainability would be enormous. Wal-Mart’s goal is “to ‘democratize sustainability.’ … to use Wal-Mart’s unparalleled economies of scale to put everything from organic T-shirts to compact fluorescent light bulbs to pesticide-free foods within reach of the masses.” Given the huge volume that Wal-Mart requires, it will be interesting to see to what extent this is possible without corrupting some of the ideals of sustainability. For example, will Wal-Mart really be able to contract with local vendors near its store locations or will it end up shipping in organic produce from New Zealand?

I am extremely interested to see what will happen with this. If Wal-Mart is serious about this, it will dwarf all other attempts at corporate sustainability and probably end up shifting a significant portion of the retail industry along with it. It seems to be a real test of whether or not the current system of “transnational corporations run amok” can manage to fit itself within increasingly pressing environmental constraints.



  1. I have to admit, the announcement of Wal-Mart leading the country to a place of supposedly sustainable bliss leaves me a bit confused and queasy. Before going into all the hesitations, I should probably state outright that I do welcome these changes from Wal-Mart. What it is offering to do could indeed result in great environmental and other benefits. For that, I applaud the effort. Wal-Mart is also a company that is serious about setting goals and following through, so I do not have doubts that they will take their efforts very seriously.

    At the same time, I think the questions you raised are right on. Given the current political economy, will they run into problems implementing all of their goals? First of all, for a company with over $11 billion profits in 2005, $500 million annual investments in environmental improvements is quite a tiny fraction. Will it be enough given the massive array of improvements they will need to conduct across the country?

    Other questions, for example, include: How do you insist upon buying food from local vendors when many regions can only grow a limited amount of fruits and vegetables for a limited time in the year. Furthermore, by contracting with local vendors, do these (presumably smaller, more independent) farmers run the risk of selling their goods for less than they could at a local, seasonal Farmer’s Market? Indeed, does this run the risk of drying out Farmer’s Markets across the country?

    While Wal-Mart probably welcomes the opportunity to improve its image by carrying the green banner and supposedly leading the green march, larger social, economic questions still remain about Wal-Mart. I suspect that Wal-Mart it ultimately carrying out these improvements because they found out the magical formula–by doing this they not only get the positive PR, but they also reduce their costs. The larger questions about Wal-Mart that remain urge us to consider whether or not the dominance/proliferation of the Wal-Mart model organizes our world in a sustainable way.

    For example, is it sustainable to hire so many people on such low wages with no, or minimal, health and pension benefits? Is it sustainable to dot the country with stores that cover significant tracts of land along with large asphalt parking lots adjacent to them? Is it sustainable to run a business that organizes communities on a very suburban model in which mega-stores are for various reasons concentrated in nearby commercial centers that most often must be driven to, and are much less accessible by foot, bike, and public transportation? Is sustainability synonymous with economic profitability?

    Perhaps we could envision a different kind of Wal-Mart. Or are the nature of its business, land-use, HR practices, suburban model inextricable from its identity? Could a hypothetical Wal-Mart champion the reorganization of the U.S. suburbs into a sustainable haven? Could it build smaller stores around the corner, walking/biking distance, from residential clusters? Could it build multi-level buildings and parking ramps rather than sprawling over acres of land? I think providing answers to these types of questions and the ones posed in the previous paragraph would put at ease some of us who still feel a little puzzled about Wal-Mart’s latest environmental initiatives.

    Comment by Amir — Thursday, July 20, 2006 @ 1:33 am

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