The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

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Wednesday, May 2, 2012

Strategic CSR - Walmart

In contrast to recent media coverage (and CSR Newsletters), here is some good news about Walmart. The article in the url below summarizes Walmart’s progress in relation to the environmental goals announced by former CEO, Lee Scott, in his landmark October, 2005 speech titled ‘Twenty-first Century Leadership’ (http://walmartwatch.com/img/documents/21st_Century_Leadership.pdf):

    • To be supplied 100% by renewable energy.
    • To create zero waste.
    • To sell products that sustain our resources and environment.

Walmart is far from achieving these goals, but the progress the firm has made is significant:

[Walmart] now reuses or recycles more than 80 percent of the waste produced in its domestic stores and in its other United States operations. That is up from 64 percent as of 2009, but it is short of the zero-waste goal the company hopes to get to. … Mr. Scott initially said he wanted no waste from the stores to go to landfills. Ms. Lockwood said the company now recycles things like aluminum and shrink wrap, reuses items like wood pallets, donates usable food to charity and turns other food into animal feed or compost. … Mr. Scott said in 2005 that he wanted to reduce greenhouse gases from its stores by 20 percent over the next seven years, the end of 2012. Wal-Mart has so far reduced greenhouse gases at its stores that were open in 2005 by 12.74 percent, according to the report. He said he wanted to double the fuel efficiency of its trucks in the next 10 years. The company has improved fuel efficiency (which it defines as cases shipped per gallons burned) by 69 percent versus 2005 levels. The company said it wanted to be supplied by 100 percent renewable energy, and is now at 15 percent renewable energy globally.

The gap between promise and reality explains the recent criticism the company has received regarding its commitments to sustainability (see Strategic CSR – Walmart vs. Apple). Irrespective of the extent to which any firm’s business model that is based on maximizing consumption can be sustainable, Walmart is making progress. And, as with anything the firm does due to its scale and scope, any progress adds significant social value and should be encouraged. It also has benefits for the firm:

Wal-Mart’s environmental push has helped transform public opinion of the company, easing the way for it to open stores in urban areas like Chicago and Los Angeles. About a quarter of Americans now have a favorable impression of Wal-Mart, about double the percentage that did in 2007 … according to the YouGov BrandIndex, which measures consumers’ impressions of companies and products.

It will be interesting to see how recent events shape both Walmart’s work on sustainability, as well as public perceptions of the firm.