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Wal mart’s green gift to its suppliers

September 27, 2007

Wal-Mart has launched a number of green initiatives in the last 24 months, but all of them have been internally focused.

A couple of days back, the company went further than it’s even done by bringing its suppliers into the mix. It’s picked some categories and is asking suppliers in DVDs, toothpaste, soap, milk, beer, vacuum cleaners, and soda to look at their greenhouse gas emissions. It looks more of a carrot, than a stick, allowing suppliers to benefit from its own learning, rather than an accounting system to punish those that don’t achieve targets. In fact, there are no targets for individual suppliers, Wal-Mart only has its own goal.

The net impact of the initiative will be to raise the profile of green measurement across a broad range of categories in consumer products. Obviously, the benefits for those that jump on board will be two-fold.

1. Cost savings- the accounting system will identify areas where companies can save money- as well as greenhouse gases

2. PR- There’s the potential to publicize your efforts, but tread very carefully here.

Overall, it looks like its a smart step in the right direction with obvious benefits for Wal-Mart and its supply chain.

However, it’s toothless and without serious targets in the program, one has to question how much impact it’s really going to have.

Posted by Ed Cotton

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