Walmart Turns Up the Heat
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by Aran Rice on 09/28/2012
On September 13th, the Walmart Sustainability Team, as well as senior executives including CEO Mike Duke, met to discuss the state of the company’s widely publicized environmental initiative at the Global Milestone Meeting. Additionally, the President and CEO of the World Wildlife Fund, Carter Roberts, was present at the meeting, discussing the NGO’s relationship with the retail giant and what he believes to be the critical intersection of industry, government, and NGO’s in addressing some of the largest environmental impacts in our society.
The Walmart Sustainability Team announced that it is ahead of schedule with the roll out of the Live Better Scorecard, often referred to as The Index, which looks at each product category through a unique lens, developed specifically for its most relevant environmental impacts. These metrics, or KPIs, were developed in partnership with The Sustainability Consortium and reflect years of work identifying the key areas of impact in the development, use, and disposal of products in hundreds of different categories. While the Walmart team was expecting to have the scorecard in the hands of buyers in approximately 100 categories by the end of 2012, they are already on track to double that number this year. The expectation is that another roll out of that size will happen in 2013.
While the first segment of the meeting was dedicated to detailing this product measurement tool, the majority of the agenda was devoted to describing the roles that both suppliers as well as buyers will play in its implementation.
On the supplier side, the evolution from the very generalized Supplier Sustainability Assessment that was launched in 2009 to today’s more category-specific evaluation process will require a more sophisticated look at environmental impacts from product to product. The expectation is that suppliers will provide detailed responses to targeted questionnaires and will then be given scores that help them measure their performance and understand where they stand against competitors in the category.
For the merchant group, Walmart has created an incentive program that ties the performance of the buyer’s product lines to a portion of their compensation. Mike Duke spent a significant portion of his presentation discussing what he called the “holistic” buyer model. He gave examples of how he and a group of merchants spent time this year visiting beef ranches which displayed high performance through sustainable practices. In his view, the Walmart merchant is evolving into a buyer who views products through a holistic lens of price, performance, and sustainability.
At Renewable Choice, we’ve been supporting suppliers with responding to scorecard requirements since 2009, and are tracking the rollout of the Walmart initiative closely. If we can support you in understanding how the Index will impact your business, please contact us.
Photo Credit: Marc Gunther
Aran Rice is Vice President of Sales for Renewable Choice.