Building SuperConsumers: Wal-Mart's Unsustainability Report

One of the little-noticed side stories in the wake of Hurricane Katrina, was the impact the storm had on Wal-Mart CEO Lee Scott. "Katrina was a key personal moment for me," Scott admitted. Where others saw devastation, the head of the world's largest retailer saw a vision of his company's lead role on the world stage. "I saw the pain, the difficulty, and the tears," he told business leaders in Chicago in 2005. "But I saw something else. I saw a company utilize its people resources and scale to make a big and positive difference in people's lives...What if we used our size and resources to make this country and this earth an even better place for all of us." Lee Scott had stumbled on the environment. "Frankly, I thought the environment was the least relevant," he confessed. "We are recycling responsibly and we are not wasteful -- so a Wal-Mart environment program sounded more like a public relations campaign than substance to me." But motivated by his company's experience with the Katrina disaster, Scott committed himself to three environmental goals: 1. To be supplied 100% by renewable energy. 2. To create zero waste. 3. To sell products that sustain our resources and environment. That was October 24, 2005. This week, Wal-Mart released a 59 page "sustainability" progress report for the past year. The report is meant to convince the public that Wal-Mart believes "what's good for the environment can be good for business too." "To make sustainability sustainable at Wal-Mart, we've made it live inside our business," Scott writes. But the real question is: will anyone outside their business believe that a company with nearly 2 million underpaid workers (more than half of them not buying their company's health plan), millions of square feet of "dark stores," more than 9,000 sweatshop factories, and more than 7,000 trucks on the road---will ever meet sustainable dimensions? Sustainability to Wal-Mart does not mean walking with a light footprint on the earth----the company opened a new store in America every 44 hours last year, and shut down just as many discount stores along our roadways. To Wal-Mart, sustainability means "we don't believe our customers should have to choose between products they can afford and products that are ethically sourced, high-quality, and environmentally friendly." In other words, sustainability at Wal-Mart means sustaining their net profits, which means growing its bottom line enough to keep stockholders in the green. "We make no claims of being a green company," Scott admits. "But what we are saying is we're doing sustainability in a way that's real and right for Wal-Mart." But sustainability done the Wal-Mart way amounts to little more than the public relations campaigns Scott disparages. This week's report is crammed with "performance metrics" that range from the obscene (profit per worker: $6,409.47) to the bizarre (combined weight Wal-Mart employees say they have lost: 184,315 pounds). Wal-Mart's metrics go far beyond the environment to economic and social components, including health, diversity, and quality of life. But it all comes down to pushing the company's advertising slogan: "Save more. Live Better." As Scott asserts, "Families who save money can use the savings to participate in the digital revolution, put more food on their kitchen tables, buy more environmentally friendly products, and achieve their aspirations." In other words, Wal-Mart superstores can turn normal consumers into superconsumers. The key to Wal-Mart sustainability is "Buy More Products." Driving us all towards increased per capita consumption is, in fact, anathema to sustainability. What Wal-Mart calls "Sustainability 360" is actually a journey towards Unsustainability. The company counts how many fluorescent light bulbs it sells, how much it reduces in vendor packaging, and how many tons of aluminum its employees say they have recycled. Not only are such numbers questionable, they fail to lead to sustainability. Wal-Mart believes that by driving up consumption on the planet, they are somehow "reducing the amount of waste we send to landfills." Their vision of converting sweatshop factories into "good neighbors and good employers that offer responsible pay and benefits" is nothing more than Happy Talk. Also this week 23 organizations, coordinated by the group Big Box Collaborative, issued a joint report critiquing the Wal-Mart sustainability movement. The analysis, prepared by some of the country's most respected public interest groups, includes sections on Wal-Mart's specific commitments in seven product areas -- organics, seafood, shrimp, forest products, cypress mulch, product packaging, and toxic chemicals -- as well as sections on global warming and Wal-Mart's international business practices. The report argues "that even if Wal-Mart achieved all of its stated goals, the company's business model is inherently unsustainable." The report explains that Wal-Mart is like an elephant that can't get out of its own way. "Wal-Mart's goal to cut its annual greenhouse gases by five million tons would be admirable," the study says, "if it weren't for the fact that the company publicly acknowledged in 2006 that its global operations created 220 million tons of greenhouse gases every year. That's more than 40 times the emissions the company says it would like to eliminate." The analysis also suggests that Wal-Mart as Lobbyist doesn't put its money where its sustainability is. Two-thirds of Wal-Mart's Political Action Committee contributions in the last election went to candidates who earned failing grades from the League of Conservation Voters. "Wal-Mart claims to be a leader in the battle against global warming, yet it's one of the largest contributors to politicians with the worst records on global warming," says Corporate Ethics International. "Wal-Mart can change to more efficient light bulbs, but that doesn't change its carbon footprint or the enormous social consequences of its globally unsustainable business model," a spokesman from Global Exchange notes. "If we look at its practices internationally, Wal-Mart has used its market power to cut costs at the expense of workers and the environment across the developing world." "Can a company claim to be "sustainable" when it drives down wages, refuses wages to some 20,000 minors working in its Mexican stores, pays unsustainably low prices to its suppliers (leading to sweatshop conditions), drives local stores and markets out of business, and disregards the wishes of the communities where it establishes its stores?" Even on the hot-button issue of global warming, Wal-Mart's metrics don't add up. According to the Institute for Policy Studies and Friends of the Earth, Wal-Mart's supply chain itself creates more than 40 times the emissions the company aims to eliminate. Combined with emissions from its retail operations, Wal-Mart's greenhouse gases are the equivalent of about half the amount produced annually by France. If you consider the estimated 2 million tons of annual carbon emissions associated with shipping from China to U.S. ports, pollution from inefficient non-U.S. trucking fleets, and the health impacts of port pollution on local communities, Wal-Mart's cheap imports don't look so cheap anymore. Wal-Mart's contribution to sprawl has increased shopping travel to the point where traffic associated with its stores produces more carbon dioxide than all of its other U.S. greenhouse gas emissions combined. Two years ago, Lee Scott wrote about his experience at an 'environmental' store-opening in McKinney, Texas. The McKinney store had all the bells and whistles: solar panels, shredded tires for mulch, heating supplied by used cooking and motor oil, mature trees shading the building, and wind turbines. "Our customers flocked to it," Scott boasted, and then added in a totally oblivious way, "the store manager is enjoying nearly 10% energy efficiency gains versus a 'normal' Super Center located a couple of miles down the road." That's the problem with Wal-Mart's sustainability vision: a couple of miles down the road from all the glitz and metrics, is all the company's wastefulness, inefficiencies, over-building, and junked public relations campaigns---and the company's boss doesn't even see it. Scott's vision itself is unsustainable. "Thankfully Katrina's don't come around very often," Scott concludes, "but the world needs help all the time. People and the environment are being pushed to the limit." Unfortunately, Wal-Mart is doing much of the pushing. Copies of the critique report are available at here. Wal-Mart's progress report available at here. Al Norman is the founder of Sprawl-Busters.com, and the author of "The Case Against Wal-Mart."

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