Wal-Mart’s Sustainability Summit

Submitted by Charles Frost on Mon, 10/15/2007 - 18:54.

Last week's Live Better Sustainability Summit, held just outside of Bentonville, Arkansas, was yet another in what seems to be an accelerating series of "whoda thunk" moments. Bentonville, of course, is  hometown to Wal-Mart, which sponsored the event, a daylong conclave that brought together more than a thousand people to a nearby convention center. It was all part of Wal-Mart's latest crusade: to "drive profitable product innovation" into its supply chain.

I had the opportunity to attend, not as a participant but as an observer, one of a small handful of media and bloggers admitted to the event. (Another was Sami Grover of Treehugger, who's report can be found here.)

The event was divided into two parts: a meeting of about 400 chief executives of Wal-Mart suppliers, and an exhibit hall featuring tabletop displays from roughly seventy companies and organizations, mostly consultancies (BluSkye, Domani, GreenOrder, McDounough-Braungart Design Chemistry, Natural Logic), nonprofits (Alliance to Save Energy, Business for Social Responsibility, Organic Exchange, Rocky Mountain Institute, TransFair), and some corporations that have worked successfully with Wal-Mart (BP, General Mills, 3M, Interface, S.C. Johnson). It was remarkable seeing all these entities (see the entire list here) side by side, with relatively uniform exhibit space, somewhat more egalitarian than your typical exhibition floor.

The other part was a half-day conference, including a two-hour presentation and panel discussion led by Wal-Mart CEO Lee Scott, followed by breakout sessions on "engaging your organization in sustainability," "sustainability and product innovation," "making sustainability work," and "driving business value through sustainability."

What was the point? Wal-Mart, it seems, seems to have discovered what a growing number of companies have learned. Being a greener business isn't just about being more efficient or increasing sales. It can be an engine for innovation in products and packaging, even delivery systems. And it wants to help its tens of thousands of suppliers move in that direction.

The context, of course, is somewhat more complex. As Wal-Mart continues down the road to environmental improvement, it needs help from its suppliers to meet its ambitious goals. And in the manner that only a $348 billion retail giant can command, Wal-Mart is pressing its suppliers to improve their packaging, reduce waste, reduce toxicity, and create offerings aimed at Wal-Mart's new mantra: "Save Money, Live Better."

Wal-Mart isn't exactly asking suppliers to think and act more proactively on the environmental front. It's using its considerable clout to create almost a competitive atmosphere around "green." In coming months, for example, Wal-Mart will be judging all of its suppliers on packaging, using metrics governing the quantity and environmental friendliness of suppliers' packaging as a buying criterion. Last month, the company announced that it would measure the energy use and emissions of the entire supply chain of seven product categories, with the likely goal of using climate impact as another buying criterion. And the company has integrated sustainability in the performance evaluations of the stores' buyers and their managers, which in turn help determine their raises and promotions.

It's all rather confusing, in the sense that one must keep reminding oneself that this is, after all, Wal-Mart (and Sam's Club, the company's other U.S. chain), the company with a reputation for squeezing suppliers until it hurts in order to achieve the goals of its old mantra, "Always Low Prices." Can these same companies now become effective partners toward the goal of reducing everyone's environmental footprint while bringing to the mass market a growing number of innovative, or at least improved, green products?

Lee Scott seems to think they can. Some excerpts from his remarks to the gathering of suppliers as well as executives from his own company:

Sustainability is here to stay. It is not a fad, it is not a marketing ploy. . . . It is in fact a part of what all of us are going to be doing with our businesses from here on out. It is not about higher margins and higher prices. It is about the elimination of waste. It is about making our businesses more effective. It is about transferring those benefits on to the consumer. And it is about taking chemicals and things we know aren't good for the environment and finding alternatives to those chemicals so we make products safer.

I think for Wal-Mart one of the key roles for sustainability is it is going to cause us to have better products. Because we're going to be thinking about the quality in those products: what is the defective rate  . . . what are the life-cycle costs of that product . . . . Ultimately my view is that because of sustainability, we also will be dealing with the best companies. Let me talk about sourcing from someone who is willing to compromise on the environment -- maybe destroy waste in an inappropriate way, or use chemicals that they shouldn't. What in the world would make Wal-Mart think that the person who is willing to compromise the environment, knowingly, wouldn't also be willing to compromise on quality to meet a price point? . . .

My belief is that we're going to find that sustainability and all of these social context issues are all related and all end up showing up in the quality of the products. And that as we use sustainability as a driving force, we will have better suppliers . . . and it will enhance the reputation that we have as a company.

High-minded words, to be sure. And they will likely rankle Wal-Mart's many detractors, for whom the words "Wal-Mart" and "sustainability," used together, are simply discordant. The doubters are not irrational. For years, Wal-Mart has been an aggressive, sometimes arrogant, leviathan, seemingly out of touch with progressive social and environmental ideas and ideals. In its single-minded pursuit for growth and dominance, it played rough -- with competitors, communities, suppliers, politicians, and anyone who got in its way, notably (or especially) activists. How can this sudden embrace of sustainability be anything other than a cynical ploy?

I'm pretty sure that it's not. In recent months, Wal-Mart has put itself out there in ways that few other companies have done. It is spreading the green gospel to its 1.3 million employees, teaching them how to live greener lives. It is inviting activists into its offices, and commanding suppliers to meet new, green goals, and parading its CEO in front of audiences and the press to talk the sustainability talk.

To the extent the cynics are right, it's that Wal-Mart's mission is to sell more stuff to more people in the pursuit of profitability and growth, an arguably unsustainable proposition. And that's a problem.

But along the way, the behemoth from Bentonville stands to move hundreds, perhaps thousands of suppliers toward a more sustainable path, and help to fuel consumer demand for things organic, nontoxic, and efficient, among other attributes. And, perhaps, engender everyday environmental habits among the citizenry in ways that even the most committed environmental activists have failed to do.

As Scott put it last week:

We have simply started. We make no claims of being a green company. We're not saying we're better than anyone, we're not saying we're doing it right. What we're saying is that we recognize an opportunity to make a difference in this world, make a difference for our customers, for our shareholders, for our associates, and it is worthwhile to do.

It's a messy affair, this sustainability thing. And Wal-Mart has made more than its share of the mess. But maybe, just maybe, that same company, in its dogged pursuit of productivity and profits, can create more than its share of the solution, too.


You often quote other's good advice - not clear here if this is you reporting or a report from others?  


OOPS... I Forgot The Link...

Sorry about that...

From: http://makower.typepad.com/joel_makower/2007/10/wal-marts-susta.html


...and some more:

Wal-Mart's Sustainability Summit: Greenwash it was Not

by Sami Grover, Carrboro, NC, USA on 10.11.07Wal%20Mart.jpg

Apologies for the lack of images of the event itself, cameras were not permitted in the conference hall.

When we solicited our reader's views on the Wal-Mart Live Better Sustainability Summit yesterday, and on the company’s eco-efforts in general, the majority of responses could best be described as cautiously positive. A few detractors did question whether a chain the size of Wal-Mart can ever be truly green, but others pointed out that it is Wal-Mart’s sheer size that makes it such a potential driver for sustainability across the business world. There was no clearer indication of this possibility than wandering the isles of the summit yesterday.

Representatives of suppliers to Wal-Mart mingled with company associates perusing information on efficient manufacturing, renewable energy, organics, certified forestry, and change management for sustainability. They asked questions on how they could green their packaging, how they in turn can influence their own suppliers, and what can they do to cut their carbon footprint. It really was palpable that these companies are taking sustainability very, very seriously now that Wal-Mart is doing the same. We spotted CEOs, VPs and other senior executives of major corporations including BBC International. Sony, 3M, SC Johnson and others. This was a major event, with serious green content way beyond PR fluff.

We will be reporting more on the details of the summit over the next few days, as this post is being written from the airport as the author travels back home, but in brief the day consisted of a well appointed resource fair, with exhibitors including WWF, FSC, BP Solar, TransFair, Organic Exchange, McDonough Braungart Design Chemistry, the Biomimicry Guild, Act Now and many, many more.

The main event was a speech by CEO Lee Scott in which he stated in no uncertain terms that Wal-Mart is in this for the long haul, and expects its suppliers to be in it for the long haul too. Scott pointed out that while his company is aiming for zero waste and 100% renewable energy, this still only accounts for 8% of its footprint, and that Wal-Mart must green its supply chain if it has any chance of becoming sustainable (Scott was also at pains to point out that the company is not, and does not claim to be, a green organization – it is just starting to move in that direction). We will bring you a separate post on the details of what was said, but Scott announced a number of milestones that have been reached, including already passing their goal of selling 100 million compact fluorescent light bulbs this year, and then described how suppliers can do their part to reduce packaging, eliminate toxins, and green their energy use.

We left the event in no doubt that Wal-Mart has set itself firmly in the spotlight by making a strong, unequivocal statement on it’s goal of sustainability, and any u-turn would be tough indeed. The motivation for these moves is, as many of our readers have pointed out, not a question of philanthropy – Wal-Mart sees clear business opportunities and intends to seize them. In the end this is perhaps the most encouraging sign of all – putting any moral imperetive aside, businesses are seeing that green just makes sense.

Having said all of the above, a huge question still remains – can a company that is based on selling as much stuff as possible, as cheaply as possible, ever be green? If they use half as much energy to produce a T-short, but sell four times as many, the environment will still suffer. This is a conundrum that goes to the very heart of the sustainability debate, and one that Wal-Mart does not have the answer to (to be fair, they don’t claim to either). Ultimately, so much of being green on an individual level is about buying less crap, and using what we have better. This author is unlikely to be shopping at Wal-Mart any time soon, and tends to avoid shopping as much as possible anyway. Nevertheless, we don’t see a collapse of our capitalist system coming any time soon (and we’re not sure we’d welcome it when it came), so we see any efforts by a company as large as Wal-Mart to make things better, greener and and with better conditions for its workers and those of its suppliers as a very, very good thing. ::Wal-Mart Live Better Sustainability Summit:: Via personal invite::

Disclaimer: Sami Grover is also Director of Sustainability at The Change, a company that was invited to exhibit at the event.

From: http://www.treehugger.com/files/2007/10/walmarts_sustainabilty_summit.php

Make a buck

  I am completely plagarizing Robert Reich from Supercapitalism.  Order it from the library, don't go out and buy it.
He describes the creative-destruction and consumer-investor driven global economy.  We are creating this divide, sometimes unwittingly, as in the monies invested in our mutal funds and retirement accounts.  The bottom line for all of us?  Make a buck.  We don't care about genocide in Darfur, or if some poor kid in Indonesia made our shoes, or if a whole neighborhood gets bulldozed and tenants get thrown out on the streets. We have swung "toward a society driven mainly by consumers and investors, one in which the idea of the common good has all but disappeared." 

Wal Mart's bold moves

    It is really wonderful to see Wal Mart moving in this direction, and thanks for such an enlightening on-the-scene report.  I was clued in to Wal Mart's interest in sustainability over a year ago when the store contacted one of my faculty advisor's, David Cooperrider (recently named Fairmont Minerals Chair for Social Entrepreneurship) and inquired about the incorporation of sustainable store strategies and the value of models for effective change facilitation like his brainchild, Appreciative Inquiry.   The opportunity for massive significant change with this bohemoth of Buyer Power with not only its own facilities and equipment but with all the suppliers shelved within the stores is staggering.  As a teaching assistant for one of his courses at Weatherhead I learned with many other change leaders about first-mover efforts to significant reduce packaging on various product lines and innovatively heat passenger cabins of commercial shipping trucks.

As Ex-CEO Carly Fiorina of HP put it, "Doing good and doing well need not be mutually exclusive outcomes".  I think this very well sums up the ideal approach here.  Revenue streams that manifest from sustainable strategies abound with the application of a little creativity.  One of the important keys is that the returns from energy efficient projects is much more prolific given a sufficiently long time horizon - and it will be a core challenge to inculcate this reality with the middle management teams driven by short term profit centricity.  Back in 2004 I introduced  new organizational design (Research ShowCASE winner) that might be able to better facilitate corporate sustainability and stakeholder based stewardship of company and community.  I call this Ring-Cone Theory and you can find a paper detailing this equitable equity generator and triple bottom line philosophy here.

I am ever and always motivated by the opportunity to introduce innovative and forward thinking  sustainability strategy in opportune places - it seems that there might be a potential fit with Wal Mart's organics - both botanicals and produce  to challenge present suppliers to innovate by creating beta versions for ultra efficient subterranean organics production.  Perhaps they might be willing to support the R&D budget necessary to enable the rapid prototyping and testing processes that could expedite successful Grow Coil production.  These growing pods, once fashioned so they are cost effiicent to produce and maintain (preferably with alternative energy technology so they are regenerative) could serve not only to innovate but revolutionalize agricultural science and a point-of-sale  production model could ensure local, year round food economies.

Nifty news on the progress made by the monster of retail -  thanks Bill!

P&G, Others to Join In Pushing Plants For Emissions Data

Big Firms to Press Suppliers on Climate

October 9, 2007; Page A7
A group of multinational companies is embarking on a campaign to encourage their suppliers to report greenhouse-gas emissions, pressuring thousands of vendors and factories to show they are taking steps to battle climate change.
At least six of the world's largest companies, including Procter & Gamble Co., Unilever, Tesco PLC and Nestlé SA, will announce today that they are banding together to press their suppliers to release data about carbon emissions and climate-change-mitigation strategies. The move affects plants churning out products as diverse as T-shirts, cocoa beans and razors.
The effort comes amid growing concern that stricter climate-change laws could drive up costs for businesses. Many U.S. companies are betting that federal climate-change legislation -- which could include taxes or caps on emitting greenhouse gases -- is inevitable in the next several years.
Global leaders are gearing up to negotiate a new international treaty on climate change to succeed the Kyoto Protocol, which will expire in 2012. Rising energy costs associated with stiffer regulations could affect companies all along the supply chain, so some are taking steps now to curb upstream costs.
"Everybody who uses energy will be impacted if energy prices go up, from the oil wells through the farms and factories, all the way through the retailers to our consumers," says Bill Greggs, an associate director in P&G's global sustainability group.
In addition to keeping an eye on the bottom line, companies are also touting their environmental strategies as a marketing tool as consumers become more aware of climate change.
The companies in the new group, called the Supply Chain Leadership Coalition, could eventually use the information to evaluate suppliers, setting off competition between suppliers to show their green credentials. The group, which also includes Imperial Tobacco Group PLC and Cadbury Schweppes PLC, was formed in partnership with the Carbon Disclosure Project, a London-based nonprofit organization that publishes data on the carbon "footprints" -- an estimate of the amount of carbon dioxide emitted in business operations -- of many of the world's largest companies. The CDP will survey the suppliers about their carbon emissions on behalf of the companies.
While many companies in the U.S. and Europe now measure their own carbon footprints, most look only at direct emissions, such as the energy consumed by lighting in their stores or the trucks that deliver their goods. Academics and emissions experts say that can create a flawed picture because far more carbon is emitted in the process of manufacturing goods than in distributing and selling them.
In the future, consumers may be able to shop for even small items with a carbon footprint in mind. Cadbury Schweppes is one of a number of European companies trying to label individual products with carbon-emissions data. Cadbury is trying to figure out how much carbon is released in the process of making a Dairy Milk chocolate bar, from the dairy farm through the factory. Eventually, the company plans to stamp the bars with a carbon footprint number, alongside the calorie count.
The announcement comes just two weeks after Wal-Mart Stores Inc. announced similar plans to begin asking suppliers for data on their energy efficiency, in partnership with the CDP. Wal-Mart has started monitoring emissions at 25 to 30 companies that collectively supply seven products: DVDs, toothpaste, soap, milk, beer, vacuum cleaners and soft drinks.
Oakhurst Dairy in Portland, Maine, one of Wal-Mart's major milk suppliers in New England, was recently asked by the retailer to measure the carbon footprint of a case of milk. Oakhurst says it ultimately found the internal energy audit process useful.
Oakhurst, which was taking steps to reduce its fossil-fuel use before Wal-Mart's request came along, says it is in the process of converting its delivery trucks to biodiesel and plans to install solar hot-water heaters for washing milk crates. "Analyzing energy use is just good business," says Bill Bennet, Oakhurt's chief operating officer. "We all should be doing that anyway to save money."

Plug Power Receives Fuel Cell Order From National Retailer

Press Release
Source: Plug Power Inc.

Plug Power Receives Fuel Cell Order From National Retailer
Monday October 22, 7:01 am ET

Sale marks significant step in adoption of fuel cells for material handling applications

VANCOUVER, British Columbia, Oct. 22 /PRNewswire-FirstCall/ -- Plug Power Inc. (Nasdaq: PLUG - News), through its wholly owned subsidiary Cellex Power Products, Inc., today announced a purchase order for GenDrive(TM) fuel cell power units from Wal-Mart Stores, Inc. (NYSE: WMT - News) for use in lift trucks at one of the company's distribution centers. This is Plug Power's largest single GenDrive order to date, although the specific terms are confidential.

The order follows a successful beta trial at two Wal-Mart distribution centers in Ohio in late 2006. During the trial, the 12 fuel-cell-powered pallet trucks ran in live, working conditions for more than four months, logging more than 18,000 hours and 2,100 indoor fuelings by pallet truck operators. The Cellex Power fuel cells demonstrated environmental and operator benefits. The new units will power pallet trucks used at Wal-Mart's food distribution center in Washington Court House, Ohio, replacing the lead- acid batteries that are traditionally used in such applications.
"This is a significant event for Plug Power and a solid step forward with the widely respected leader in distribution and logistics," said Tom Hoying, Plug Power's vice president of sales and customer operations, Motive Power Division. "We believe Wal-Mart's state-of-the-art distribution centers make an excellent proving ground for the commercial application of GenDrive."
This fuel cell order aligns with Wal-Mart's strategy to integrate innovative technologies into its business plan that reduce operating cost and help the environment. The purchase of these fuel cell power units is equivalent to removing approximately 60 cars from the highway in southeastern Ohio in terms of CO2 and greenhouse gas emissions.
"We've seen how fuel cells can improve efficiency in our distribution centers while enabling us to be more responsible global citizens," said Johnnie Dobbs, Wal-Mart's executive vice president of logistics and supply chain. "Wal-Mart is focused on finding ways to improve our relationship with the environment throughout our operations. Our hope is that our investment in fuel cell technology will encourage its development as a viable option to existing technologies."
For pallet trucks and similar industrial vehicles operating in large, around-the-clock fleet operations, lead-acid battery systems can be more expensive to operate and require more valuable space when compared with fuel cell power units. Lead-acid batteries also require documentation demonstrating proper disposal and present other safety issues in terms of care and handling. Plug Power's GenDrive product eliminates the need to change, charge, maintain and handle batteries in these high-throughput distribution centers, which could result in cost improvements and productivity gains.
Plug Power, which acquired Cellex Power in April 2007, considers material handling applications to be an attractive near-term market for proton exchange membrane (PEM) fuel cell power and has targeted this sector as a central component of the company's revenue growth strategy.
"We view Wal-Mart's purchase order as an important indicator of the progress that fuel cells are making as reliable and clean alternatives to incumbent technologies in a variety of industries," said Roger Saillant, Plug Power's President and CEO.
About Plug Power
Plug Power Inc. (Nasdaq: PLUG - News), an established leader in the development and deployment of clean, reliable on-site energy products, integrates fuel cell technology into backup and primary power products for telecommunications, material handling, utility and uninterruptible power supply applications. The Company is actively engaged with private and public customers in targeted markets throughout the world, including North America, Europe, the Middle East, Russia, South Africa and South America. For more information about how to join Plug Power's energy revolution as an investor, customer, supplier or strategic partner, please visit www.plugpower.com.

Source: Plug Power Inc.

From: http://biz.yahoo.com/prnews/071022/nym027.html?.v=101