The Verdant 360 Blog

It’s hard not dwell on the importance of Walmart’s announcement this week. I have not previously devoted three straight posts to the same topic, but I do feel that it is potentially the most significant approach to sustainable business practices we have seen to date. Walmart’s global reach and purchasing clout are unparallelled in the retail space. It has over 100,000 suppliers. For this reason alone any announcement around sustainability is important, but when you combine it with an actionable request (albeit voluntary) to complete a survey by a target date (in this case, October for U.S. based suppliers) and all of a sudden it forces a whole bunch of people to evaluate their sustainability positions.

Broken into four sections, the survey appears simple at first glance and some of the questions are fairly opened ended, but the sum of the survey, is that it requires an examination of sustainability practices and will allow for comparisons that were not previously possible. In this blog post  I will list the questions by section. In subsequent posts I will examine the survey on a section by section basis.

Energy and Climate: Reducing Energy Costs and Greenhouse Gas Emissions
1. Have you measured your corporate greenhouse gas emissions?
2. Have you opted to report your greenhouse gas emissions to the Carbon Disclosure Project (CDP)?
3. What is your total annual greenhouse gas emissions reported in the most recent year measured?
4. Have you set publicly available greenhouse gas reduction targets? If yes, what are those targets?

Material Efficiency: Reducing Waste and Enhancing Quality
1. If measured, please report the total amount of solid waste generated from the facilities that produce your product(s) for Walmart for the most recent year measured.
2. Have you set publicly available solid waste reduction targets? If yes, what are those targets?
3. If measured, please report total water use from facilities that produce your product(s) for Walmart for the most recent year measured.
4. Have you set publicly available water use reduction targets? If yes, what are those targets?

Natural Resources: Producing High Quality, Responsibly Sourced Raw Materials

1. Have you established publicly available sustainability purchasing guidelines for your direct suppliers that address issues such as environmental compliance, employment practices and product/ingredient safety?

2. Have you obtained 3rd party certifications for any of the products that you sell to Walmart?
People and Community: Ensuring Responsible and Ethical Production
1. Do you know the location of 100 percent of the facilities that produce your product(s)?
2. Before beginning a business relationship with a manufacturing facility, do you evaluate the quality of, and capacity for, production?
3. Do you have a process for managing social compliance at the manufacturing level?
4. Do you work with your supply base to resolve issues found during social compliance evaluations and also document specific corrections and improvements?
5. Do you invest in community development activities in the markets you source from and/or operate within?

15 questions, simple enough, but when we dive into them by section in subsequent posts, you will see the answers may not be that simple.

-FR

Corporate Social Responsibility, Supply Chain, Sustainability, Uncategorized GHG's, Sustainability, Sustainable business practices, Wal-mart, Walmart, Walmart's Sustainability Index

With the release of his new budget, President Obama has reinforced his commitment to reduce Greenhouse Gas Emissions (GHG)’s. Although the mechanisms for quantifying and report  GHG emissions are still being debated, we are clearly moving in the direction of carbon footprint reporting. This is setting the stage for a true cap and trade scenario. According to his budget, Obama is projecting that cap and trade will amount to $300 billion in tax revenue by 2022 and that by 2012 the cap and trade program will begin to have budgetary impact.

What this all means for business leaders is that we will need to be prepared to address this scenario. Although 2012 seems a long way off, particularly given the current economic challenges, the complexity of the issue is such that we need to prepare now. Indeed House Energy and Commerce Committee Chairman Henry Waxman has brought forth legislation which he vows to have approved by Memorial Day that will limit carbon emissions. The Bill entitled The Safe Climate Act of 2007 (H.R.1590) has set very specific targets.

The Safe Climate Act freezes U.S. greenhouse gas emissions in 2010, at the 2009 levels. Beginning in 2011, it cuts emissions by roughly 2% per year, reaching 1990 emissions levels by 2020. After 2020, it cuts emissions by roughly 5% per year. By 2050, emissions will be 80% lower than in 1990. These goals are comparable to emissions reduction goals adopted by many states and called for by leading American companies, small businesses, religious organizations, environmental advocates, and others

The bill is supported by GE’s Jeffrey Immelt and Duke Energy’s Jim Rodgers both of whom endorsed the legislation at a session with the committee in January and lays the groundwork for a cape and trade program.

It is not surprising that many business leaders are not focusing on the issue of trade at the moment. Given that many businesses are simply striving to survive the current economic crisis, it may not seem a priority. However, the fact remains that should the legislation pass as promised by Memorial Day, it leaves businesses 6 months to quantify there 2009 carbon footprint and prepare to meet or lower them for 2010. Building on the assumption that the economy turns around and economic activity increases, businesses will almost certainly have to have a plan to lower emissions just to meet their 2009 emissions.

-FR

Carbon Footprint cap and trade, Carbon Footprint, carbon offsets, GHG’s, green