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Walmart unveils new sustainability initiatives
October 26th, 2012
Walmart's Mike Duke in Beijing
BEIJING – Walmart has launched a series of new sustainability initiatives at an event here attended by officials of the Chinese and U.S. governments, nongovernmental organizations (NGOs), academics, suppliers and Walmart associates.
"Today I’m proud to announce a series of steps and commitments that will make Walmart’s supply chain in the United States, here in China, and around the world more sustainable," said president and chief executive officer Mike Duke. "The impact of these commitments will be global and make a difference with products sold around the globe."
Three years ago Walmart launched the Sustainability Index, a tool intended to measure the sustainability of its suppliers and their products and to serve as a benchmark to drive progress. At the same time it helped establish The Sustainability Consortium (TSC), which combines academics, suppliers, retailers, governments and NGOs in developing the reporting systems that form the groundwork of the Sustainability Index. The TSC currently has more than 100 members.
Duke pointed out that more than 500 of Walmart’s suppliers have participated in the Index, including many of its largest vendors. Together, he said, they represent an average of 70% of sales within the 107 product categories to which Walmart has applied the Index thus far.
The four initiatives revealed in Beijing include:
• The Walmart Foundation will grant $2 million to fund the TSC and aid its efforts to launch TSC in China. TSC China will engage industry, university and other experts to form a global network of leaders to improve sustainability in consumer goods, providing tools and resources to help suppliers in the country become more sustainable and competitive.
• By the end of 2017 Walmart will buy 70% of the goods it sells in U.S. stores and Sam’s Clubs only from suppliers around the world who use the Sustainability Index to evaluate and share the sustainability performance of their products.
• Beginning in 2013 Walmart will use the Sustainability Index to influence the design of its U.S. private label products. "In other words, sustainability will be a bigger part of the product specs that go to factories that manufacture our products," Duke explained. "We will start with toys, electronics and apparel and expand to more categories as the Index becomes available."
• Walmart will make sustainability a more important measure in the evaluation of its key global sourcing merchants, thus making it a bigger part of their day-to-day jobs. Starting next year they will have specific sustainability objectives on their annual evaluations.
"We will drive progress faster and scale our work to make factories more socially and environmentally sustainable, reduce energy and water usage, and eliminate harmful emissions into rivers and the air," said Duke. "We will also have deeper insight into how we can make manufacturing more sustainable for people and communities in China."