Or an unparalleled supply chain. Or a global workforce and consumer base. Wal-Mart is changing the sustainability game in a way that only a firm with its purchasing power and retail reach can.
Wal-Mart’s sustainability index, which will appear on product labels in the next year or two, comes as the result of a newly-formed sustainability consortium made up of academic institutions including the University of Arkansas and the University of Arizona, as well as consumer goods companies like Unilever, Tyson, and General Mills. In a sign that the company wants to make its index an industry-wide standard, Wal-Mart has also invited competing companies–Costco, Target, and Kroger–to join.
$375 billion is sales. 1.4 million US Associates. 7,200 facilities around the world. And that’s just Wal-Mart.
The additional of retail competitors and consumer goods partners makes the potential for this sustainability consortium unlike anything the private sector has ever produced. And from a marketing perspective, it’s a brilliant move. Wal-Mart has effectively cornered “green” in the world of retail.
But the real power is that Wal-Mart’s proven ability to drive costs down will be inexorably linked with sustainability performance. A good sustainability index rating will be one factored in along with price to get a product on Wal-Mart’s many, many shelves. That means that in the mind of a consumer, sustainability and savings will go hand in hand. Pretty soon, green products may no longer be viewed as luxury items that command a price premium.
There’s a long way to go before anyone can claim the effort is a success. But kudos to the folks from Bentonville, AK for putting forward a plan as ambitious as our social and environmental challenges demand.