Does Walmart Really Lead the Way in Supply Chain Stability?
In terms of sustainability, Walmart does more than they are credited for, particularly when it comes to the supply chain. In contrast, Amazon gets a lot of credit for their sustainability initiatives, even though they do not treat their warehouse workers in the best way, and never file a sustainability report.
Sustainability in the supply chain depends on how well the manufacturing, procurement and logistics departments work towards meeting sustainability goals.
In a practical situation, this means an enhanced focus on green initiatives, such as greenhouse gas emissions, conserving water, waste reduction and responsible sourcing over other sustainability factors. In the Climate Performance Leadership Index, factors such as the amount of tax being paid as a percentage of the EBITDA is a factor, as is the ratio of CEO to worker pay and levels of funding in corporate pensions. The supply chain has little influence when these are the outcomes being considered, however if there was such as thing as an index for supply chain sustainability, these factors would be ignored.
Let’s look at Walmart’s approach to green initiatives, and any other areas where they set goals for supply chain performance. Their sustainability report has clear GHG goals, and their CO2 per million dollars of revenue has fallen for each of the last six years in a row. In the longer term, they intend to achieve targets, which will reduce their energy billion by approximately $1 Billion by 2020.
Their waste reduction initiatives have not been as successful, and they have only managed to reduce the amount of waste going to landfill by 3.3% since 2010. However they do have high aspirations in this area aiming for zero waste by 2025. Most sustainability watchers tend to prefer short or medium term reductions, which are more achievable than setting the bar high over the longer term.
Walmart is not the most accomplished company when it comes sustainability—here are other companies who set higher goals and achieve them, especially when it comes to sustainability in the supply chain. However, when such a large company is taking reasonable steps toward sustainability, the impact is much greater than if a lot of small companies are doing more.