Back in April, I noticed an article in the Globe and Mail about Wal-Mart stores beginning to practice eco-efficiency, using less packaging, and even installing wind turbines outside stores. At the time, this seemed like a step in the right direction, but too early to tell whether this was the beginning of a sustainable strategy at Wal-Mart, or simply an attempt to improve their image while appealing to niche-market “green” consumers. At any rate, It would appear that Wal-Mart CEO Lee Scott had learned to talk the talk:
“It is good for business- because it creates efficiencies. It is good for our customers – because we invest the savings aback into low prices. But perhaps most importantly- it is good for the environment and for future generations.”
A recent article in Fortune magazine once again featured Wal-Mart in a sustainability showcase, and evidenced that Wal-Mart is taking this stuff seriously after all. For one thing, the goals and commitments are outlined more clearly:
“In a speech broadcast to all of Wal-Mart’s facilities last November, Scott set several ambitious goals: Increase the efficiency of its vehicle fleet by 25% over the next three years, and double efficiency in ten years. Eliminate 30% of the energy used in stores. Reduce solid waste from U.S. stores by 25% in three years.
Wal-Mart says it will invest $500 million in sustainability projects, and the company has done a lot more than draw up targets. It has quickly become, for instance, the biggest seller of organic milk and the biggest buyer of organic cotton in the world. It is working with suppliers to figure out ways to cut down on packaging and energy costs. It has opened two “green” supercenters.”
Comitted move towards sustainability? Or massive greenwashing campaign? Can Wal-Mart really become sustainable? Many people would say no, or at least not without a complete overhaul of its entire business model. As commented in the Fortune article, many see Wal-Mart as “in a race to pave the planet and turn it into a giant emporium of cheap goods built on the back of cheap labor”.
Whenever I’m asked for an example of a company on the leading edge of sustainability strategy, I tend to gravitate towards examples of large, well known companies- DuPont, BP, GE etc. – standards business school case-study stock. Large companies who adopt more intensified environmental management, or realign strategy in terms of sustainability are often compelled to do so by ‘crisis’ events (eg. Shell in Nigeria). These are events where a polished PR campaign is not good enough. People need to see that the company has changed, and is doing something, and the company knows that the penalties for not changing direction are dire.
It makes sense that large companies should adopt these strategies first- they have more resources, and represent a larger potential source for changing behaviours. But can these companies really go far beyond compliance? Can they establish themselves as true leaders in changing behaviours for the better, and helping mold our society into one capable of sustainable development? (The question of whether that is even their responsibility is a topic for another entry)
Does a sustainable future have a place for large companies? It would seem that all the advantages of a large company- the economies of scale, larger buying power, greater distribution network, are all things that result in negative externalities under present business models. For example, the scale and buying power favours the sourcing of the cheapest labour and materials worldwide. The influence of these companies on governments presents problematic human rights issues in many areas. Distribution networks provide cheaper ways for companies to move our goods across the planet before reaching the end user- to environmental detriment.
I am inclined to favour almost any action over inaction at this point- we are still on the uphill slope of the sustainable practice adoption curve- and to some degree we need to see changes in large companies to get the momentum we need to carry over consumer behaviour. However, I am also inclined to believe that a sustainable society must operate more locally, something that is at odds with the procurement and distribution practices of larger companies.
I look forward to your comments.
