Gallery: IS IT GREEN?: Wal-Mart’s Sustainability Index

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Green labels abound for seafood, coffee, fair-trade, organic products and more, but we have yet to come across one unifying label that allows us to compare apples to oranges in terms of sustainability. Now it looks like Wal-Mart, may be changing that with the recent announcement of their ‘Sustainability Index.’ Their grand plan could help consumers choose products not only based on their cost and features, but also based on their environmental impact. But is Wal-Mart really turning over a green leaf – and can the benefits of this new system help outweigh the mega-corporation’s questionable environmental reputation as the world’s largest retailer?

To create their sustainability index, Wal-Mart is working with the University of Arkansas and Arizona State University to begin a Sustainability Consortium, which will provide the academic research to back up their efforts. Faculty from Stanford, Duke, Harvard and UC Berkeley are also helping plan the index, but have not joined the consortium quite yet. A number of consumer-goods companies like Proctor & Gamble, Tyson, General Mills, Unilever and more have joined the consortium. Even competing retailers like Costco and Target have been invited to join, which says even more about this Index – if everyone gets involved it will have a far greater impact than if Wal-Mart enforces it alone.

Wal-Mart has no ambitions to own the Sustainability Index or even be in charge of it – they merely want to get the ball rolling. Ideally, the Index will be run by a non-profit organization backed by an army of academics with an all-encompassing board of directors who will ensure that the Index remains fair and accurate. The Index, which has been in development for over a year now, is said to be based on the Life Cycle Assessment tool, which takes account the full environmental impacts of a product from manufacturing, to use and finally to disposal. The index in its current form however, is not meant to rate individual products. At this point, Wal-Mart simply hopes to assess companies and their practices with regards to sustainability.

Wal-Mart has asked 60,000 of its suppliers to answer a set of 15 questions meant to delve deeper into a company’s sustainability practices. The questions, which you can see here, are grouped into 4 categories: energy and climate, material efficiency, natural resources, and people and community. Basically, Wal-Mart is trying to assess what companies are currently doing to monitor and reduce their environmental impact. There is at this point no judgment, endorsements or preference given to any supplier based on their answers – it’s merely a fact finding questionnaire. Wal-Mart’s hope is that this information will help provide the consumer better transparency and knowledge to make better consumer choices. At this stage the questions are very basic – even Wal-Mart staff admit “that this is a “ready-fire-aim” exercise — that the company wanted to get something out there, however imperfect, and improve it as it got real-world use.”

Eventually, the goal of the index is to help the consumer navigate through misleading claims and be able see past greenwashing. Rand Waddoups, Senior Director of Business Strategy & Sustainability at Wal-Mart said recently said, “We understand green-washing. [Our customer] doesn’t. She may not even be aware that it’s going on.” Waddoups also said about the Index, “Imagine one day when every product on the shelf has behind it enough information from a life-cycle-thinking perspective that allows us to be much, much more intelligent about how we’re buying,” he went on. “And really, in the end, eventually, what consumers should be.”

IS IT GREEN?

Yes. Wal-Mart’s sustainability index may be a game changer, and could easily have as much impact as a cap and trade program. With 4,253 retail outlets as of November 2008, the mega-corporation has the power and reach with manufacturers worldwide to get them on board with this program.

This is no small undertaking Wal-Mart has started and we applaud the effort to help consumers make better informed decisions. It can get tough out there wading through all the environmental claims and marketing muck. That being said, this is only the start of the Sustainability Index and it is nowhere close to being the grading systems people are claiming it to be. It will take years of trials, tests, data collection and research to develop a fair, balanced and informative sustainability rating system. The goal is to have a universal eco-labeling system for products based on everything that makes up sustainability, but at its current level of development, the Sustainability Index is yet an infant.

+ Sustainability Consortium

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7 Comments

  1. antkm1 August 12, 2009 at 4:42 pm

    This idea, in theory, sounds good. but what about regulation and keeping everyone honest? This green index may ask some pretty good questions, but how do we KNOW that the questions are being answered fairly and honestly? How are we to know, which out some sort of oversight, that these companies and suppliers are being truthful?

    Also, When i see companies like Cargill, Unilever, Monstanto. It makes me cringe too. If you’ve see the doc film “Food, Inc.” you see that companies like these are partially responsible for all the genetic massaging of our foods and which could possibly make us all sicker in the long run.

    There has to be some over-sight. Corporate green washing may be a harsh accusation, but could be not far from the truth.

  2. setheeee August 12, 2009 at 2:07 pm

    We can’t call it Greenwashing until after we see what they come up with. I agree Wal-mart has caused huge amounts of environmental destruction, via their suppliers over the years, but this may be a step in the right direction. Especially if they are looking at Life Cycle Assessments.

    What I want to see, if they really address the CORE issue, that their sustainable index rates the overseas SUBCONTRACTORS that American based Wal-mart suppliers often use… Wal-mart already requires that these Subcontractors pass a Social and Safety Audit, which are performed by 3rd parties. Why not take it one step further, and include an environmental audit for the subcontractors?

    If an American company that is really is focused on reducing power and in house waste, but the products it sells are made at an overseas factory that has very little pollution management and the products are not recyclable or not built to last, then this Sustainability Index better take that into account.

  3. John Anderson August 11, 2009 at 11:55 pm

    I am impressing by epic scale of this greenwashing. Wal-mart should receive more recognition for their naked hubris.

  4. stefanie August 9, 2009 at 10:38 am

    If you go to the website for this emerging sustainability index, you find that on the “partners” tab, Monsanto, Cargill, and Univlever are all listed. This kind of makes my blood run cold, and makes me feel as if this is one giant corporate greenwash in the making. I would love to know if anyone has looked into this — it’s extremely disturbing.

  5. archonic August 8, 2009 at 12:19 pm

    Or it’s like a large successful corporation coming up with a smart idea (first among any large corporations or governments) for significantly reducing it’s footprint and footprint of it’s customers.

    You’re comments are kind of like the ramblings of a mis-informed poorly educated angry teen.

  6. swagv August 8, 2009 at 3:26 am

    Kind of like Josef Stalin presenting himself as a potential Nobel Peace Prize candidate for his reformed record on civil rights for prisoners…

  7. swagv August 8, 2009 at 3:22 am

    IMO, Wal-Mart has done more to destroy the environment than any other corporation in existence. Saving a few watts of power on store lighting does little to change the practices of unregulated dumping by Chinese suppliers, rewarding the supply chain for strip-mining practices, etc.

    This is like Stalin after WWII later seeking recognition for his exemplary human rights treatment of prisoners.

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