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WAL-MART PRESSURES SUPPLIERS TO GET GREENER

By Kerri Linden

Wal-Mart’s green could well rub off on other chains. Last month the retailer announced that it would rank its 60,000 suppliers on their ability to develop environmentally friendly packaging and to conserve resources. The retailer says it will base its purchasing decisions on those scores, a plan that is sure to give suppliers lots of incentive to pursue sustainability.

“We know the sheer number of people that our company touches goes far beyond the four walls of our stores,” said John Fleming, Wal-Mart’s chief marketing officer, in September at a meeting of the Carbon Disclosure Project, an institutional investor group. “Out of this realization, we developed what we call Sustainability 360. The program is about stepping out … and extending sustainability to our products, suppliers, associates, communities and customers. We believe every business can look at sustainability this way, and we also believe it’s the responsibility of every corporation to be more sustainable.”

The Sustainability 360 program, scheduled to launch next year, is designed to reduce packaging volume by 5 percent by 2013, which would save about $3.4 billion. In addition, curbing the packaging volume on products from its suppliers could save as much as $11 billion, the company says. “Packaging is where consumers and suppliers come together and can have a real impact both on business efficiency and environmental stewardship,” said Wal-Mart CEO H. Lee Scott Jr. in a press release. “Even small changes to packaging have a significant ripple effect. Improved packaging means less waste, fewer materials used and savings on transportation, manufacturing, shipping and storage.” The company expects the initiative will keep millions of pounds of trash from landfills and about 667,000 metric tons of carbon dioxide out of the atmosphere. This is the equivalent of taking 213,000 trucks off the road each year, Fleming said. Wal-Mart has been working with such major suppliers as Bissell, the Coca-Cola Co. and Fox Home Entertainment to reduce the amount of packaging they use. Wal-Mart is looking at the packaging for beer, DVDs, soap, toothpaste and many more products.

The company also says it will sell only concentrated liquid laundry detergent. Wal-Mart stores account for about 25 percent of the liquid detergent sales in the U.S., and the company says this effort should save about 95 million pounds of plastic and 125 million pounds of cardboard. By next May all U.S. Wal-Mart and Sam’s Club stores will be stocking smaller detergent containers.

Further, Wal-Mart has itself joined the Carbon Disclosure Project, which provides information on the environmental profiles of some 2,400 companies to investors.