Sustainable Steps

NORTHWEST ARKANSAS — Walmart announced its sustainability initiative in 2005, but progress has been slower than even the retail giant anticipated.

Lee Scott, former chief executive off cer, set three broad goals: to be supplied 100 percent by renewable energy; to create zero waste; and to sell products that sustain people and the environment.

“The brilliance of those three goals is they hit on everything,” said Andrea Thomas, senior vice president for sustainability. “They are aspirational.”

Stacy Mitchell, senior researcher with the Institute for Local Self-Reliance, said Walmart makes big announcements, but has made little progress.

“They receive a lot of media coverage from those big announcements, yet there hasn’t been nearly the media coverage of what they have and haven’t done,” she said.

Mike Duke, Walmart chief executive oft cer, acknowledged in mid-April at the Global Sustainability Milestone meeting there is still a lot of work to do to hit the three goals, but the company is making progress.

He pointed to a team of Walmart employees who found a way to eliminate metal wires used to tie toys into boxes. The new process kept 1 billion feet of wire — or enough to wrap around the world eight times — out of landfills, Duke said.

Toy companies such as Hasbro jumped on board with the new packaging concept, he said.

“With Walmart, little things add up to be big things,” Duke said.

RENEWABLE ENERGY

Walmart’s size works both for and against it as the company strives to achieve its sustainability goals.

The retailer is using a mix of solar, wind and fuel cells in its effort to run on all renewable energy. Duke said about 4 percent of the company’s global electrical needs come from its own renewable energy projects, and it purchases 18 percent from renewable energy companies.

Walmart has 180 renewable energy projects in use or development around the world including 115 rooftop solar panel installations in seven countries and 26 fuel cell installations in the U.S.

Mitchell said the 4 percent energy Walmart produces is small and that many companies use partial renewable energy.

“To trumpet what they have done so loudly and make such slow progress seems inconsistent,” she said.

Thomas points to the company’s size to show the scope of the savings. Walmart has more than 10,000 stores across the globe and 4 percent savings equals 1.1 billion kilowatt hours of energy.

Solar panels or windmills do not work in every location. Renewable energy is highly utilized in California and Texas.

“What we’ve learned is one size does not fit for all places,” Thomas said.

In California, approximately 75 percent of the 222 Walmart-owned buildings will have rooftop solar installed by the end of 2013, according to the 2012 Global Responsibility Report.

In Texas, 350 stores receive up to 15 percent of electricity through a four-year agreement to buy clean energy from Duke Energy’s wind farm in Notrees, Texas. There are 385 Walmart stores and 73 Sam’s Club in the state.

Walmart has more than 10,000 stores worldwide.

ZERO WASTE

Walmart U.S. reported it has diverted more than 80 percent of its waste from landfills since it setting this goal.

The zero-waste-to-landfi ll program returned more than $231 million to the company last year through a combination of increased recycling revenue and reduced garbage disposal expenses, according to the Global Responsibility Report.

Steps to reduce waste include recycling, sending more perishables to food banks, eliminating unnecessary packaging and creating animal feed, energy or compost from expired food. The report shows the remaining 20 percent of waste comes mainly from restrooms and parking lots.

Mitchell contends Walmart may be reducing its own waste, but its demand on suppliers for the lowest price possible results in more consumer products ending up in the landfi ll at a faster rate. Cheaper products are often lower-quality and become throw away items that consumers find easier to replace rather than repair, Mitchell said. She is the author of the report “Walmart’s Greenwash: How the company’s muchpublicized sustainability campaign falls short, while its relentless growth devastates the environment.”

“The churn of products is good for their bottom line, but is not good for the environment,” she said.

Trying to reach zero waste extends beyond the U.S. borders. Stores in China and Brazil diverted 52 percent of waste from landfills in 2011, the company said. ASDA in the United Kingdom sends no food waste to the garbage dump. Walmart Japan achieves 100 percent zero waste in 100 stores through material and thermal recycling, a process that uses heat from burning waste.

PRODUCT PACKAGING

The third goal of selling sustainable products is under way. Thomas said 90 percent of Walmart’s carbon footprint comes from the supply chain. The company’s goal is to reduce packaging by 5 percent globally by 2013 using 2008 as a baseline.

With more than 3,800 Walmart U.S. stores and an additional 600-plus Sam’s Clubs, when the retailer makes a change that impacts packaging or transportation it has a big eff ect.

Duke wrote that the company’s sustainability index is poised to become deeply integrated into the business. Twenty product categories are being rated on environmental factors for the index. The index will expand to 100 major categories by the end of the year, he wrote.

The index will allow Walmart buyers to compare one supplier’s products against another in terms of sustainability. Buyers will have sustainability goals as part of their objectives and can use the index to measure progress against those goals, Duncan MacNaughton, chief merchandise and marketing officer for Walmart U.S., wrote on the company’s blog, The Green Room.

“We’ll recognize and reward those buyers and suppliers who are doing well,” he wrote. “We will also ask suppliers who aren’t performing well to develop plans to improve, and we’ll hold them accountable for showing progress.”

This process is in the early stages of development, but suppliers are working to become more sustainable. Many shared their stories at the Walmart and Sam’s Club Sustainable Packaging Expo earlier this month. The seventh annual expo brought hundreds of consumer packaged goods suppliers and Walmart and Sam’s Club buyers together.

Cheerios at Sam’s Club was sold in one large box with two bags. The company moved to two smaller boxes with one bag in each after shoppers expressed disapproval of the one-box format. General Mills reduced materials by 4 percent and the bags went from 75 percent to 92 percent full.

Tyson Foods went from packaging meat in side-byside wraps to stacked packing allowing more to go into each box. The company eliminated 1.2 million boxes with the new format. Walmart was then able to stack more of the new cube boxes in each truck, which eliminated 4,500 trips from distribution center to store.

Walmart is also adjusting packaging on store brands. It eliminated 16 percent of paper fiber in Great Value margarine packages in 2011. A slight redesign for a bottle of cooking oil eliminated 830,000 pounds of resin. That is equal to the weight of 41,000 cast iron pans.