Walmart to revolutionize global sustainability standards

President and CEO Mike Duke looks to the future.

When most of us think of environmentally-friendly stores offering sustainable products made efficiently and fairly, Walmart is often not the first company coming to mind.

Never judge a seemingly endless discount warehouse by its preternatural fluorescense.

The retail giant has already committed to greening its stores, including a plan to tap into solar power, and driven an effort to create more sustainable electronics devices to reduce landfill impact. Now, Walmart is demanding all suppliers provide environmental information on every product carried in its stores. Walmart will use the data to label each item with an eco rating, designed to measure its environmental friendliness and help inform consumers. 

"We have to change how we make and sell products," Mike Duke, President and CEO of Walmart, told about 1,500 suppliers and employees on Thursday, July 16, 2009 at the company's Sustainability Milestone Meeting; "Sustainability has become a part of everything we do."

Duke believes the economic crisis is leading consumers to become smarter about saving money, and expressed concern that every economic class be provided with access to quality food and environmentally responsible products. "We’re living in a world of increasing population and decreasing natural resources," he observes. "Our use of natural resources for everything we grow, eat, drink, make, package, buy, transport and throw away--all of that is out-pacing the earth’s capacity to sustain us. Fresh food and quality products shouldn’t be available to only a privileged few, they should be available to all."

In an effort to create a new global retail standard, Walmart is unrolling its Sustainability Index plan in three phases over the next five years:

Step One All Walmart suppliers will answer 15 questions on the sustainable practices of their companies around four areas:

1. Energy and Climate
2. Material Efficiency
3. Natural Resources
4. People and Community

Step Two Walmart is helping to create this Sustainability Index Consortium to develop a global database of information on the life-cycle of products (from raw materials to disposal) and share it with retailers, suppliers, NGOs, and universities. Walmart will partner with approximately 12 universities to collect the data and set new design standards. Professor Jay Golden of the Global Institute of Sustainability at Arizona State University will function as co-director of the new consortium.

"We can’t do this without partners," says Duke. "This cannot and should not be a Walmart effort. It can’t be a U.S. effort. To succeed, the Index has to be global. It has to involve many stakeholders as vital partners."

Duke's intention for the Index is to:

1. drive higher quality and lower costs.
2. encourage more innovative products that lower carbon output, promote clean air and water, and that create a more transparent and responsible supply chain.
3. make participating suppliers stronger businesses, more in touch with customers and "what they need to live better 20, 50, or 100 years from now.

Step Three Translate the information stored in the Index database into a simple tool that informs consumers about the sustainability of products. "This will provide customers with the transparency into the quality and history of products that they don’t have today," assures Duke. "It will help put them in control and consume in a more sustainable way."