Wal-Mart's Sustainability Initiatives

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Case Details:

Case Code : BECG074
Case Length : 17 Pages
Period : 2005-2007
Organization : Wal-Mart Stores Inc.
Pub Date : 2007
Teaching Note :Not Available
Countries : USA

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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The Green Strategy

How it all Started
In February 2004, during a private trip to Coco Island, a lush Costa Rican national park, Peter Seligmann (Seligmann), co-founder and CEO of Conservation International (CI), impressed upon Samuel Robson Walton (Rob Walton), the eldest son of Sam Walton and chairman of Wal-Mart that Wal-Mart could have great influence on environment protection by influencing its vast customer base. The company could do much more than whatever the family foundation was contributing toward environment protection. Earlier Rob Walton's family foundation, which had assets of US$ 1 billion, had donated US$ 21 million to CI for ocean-protection programs, and eventually Rob Walton had also joined the group's board...

Unveiling the Sustainability Roadmap
In October 2005, Wal-Mart unveiled its sustainability initiatives which were aimed at making greater use of renewable sources of energy and reducing waste and thereby improving the energy efficiency at its stores. The company outlined three ambitious goals as a part of the new strategy –to run the stores totally by renewable energy, to create zero-waste, and to sell sustainable products...

Sustainable Value Networks
Wal-Mart started seeking ideas from its employees, consultants, NGOs, and suppliers on its sustainability initiatives. It also invited experts from the World Wildlife Federation , Natural Resources Defense Council , Environmental Defense, and Greenpeace for discussions and suggestions on its green initiatives...

Experimental Stores

In 2005, Wal-Mart set up two experimental stores at McKinney, Texas, and Aurora, Colorado in the US. The company involved experts in engineering, technology, architecture, and landscape designing to build its environmentally sustainable stores. The stores were to conduct experiments with natural resource conservation and sustainable design technologies, which would be replicated in the company's other stores if they were successful. Wal-Mart saw the experimental stores as the first step in implementing its sustainability initiatives. The materials needed to construct the stores were kept at a minimum level...

Operational / Supplier Initiatives
Experts felt that Wal-Mart had a huge opportunity to make a difference in the sustainability area by revamping its supply chain. For example, it targeted to reduce 5% packaging in all its products by 2013 over 2006 levels. It was estimated that the initiative could save US$ 11 billion in the company's global supply chain. From February 1, 2008, the company was also to begin using a packaging scorecard to measure and evaluate its entire supply chain. The scorecard had attributes called the '7 R's of Packaging'– Remove, Reduce, Reuse, Recycle, Renew, Revenue, and Read. Using the scorecard, each supplier was to be evaluated relative to other suppliers...

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