Earlier today, during a meeting with 1,500 of its suppliers, associates and sustainability leaders at its home office in Bentonville, Arkansas, Wal-Mart announced plans to develop a comprehensive worldwide sustainable product index. This index –which has been described by one insider as “audacious beyond words” –will allow Wal-Mart to measure the sustainability of every product it sells.
“Customers want products that are more efficient, that last longer and perform better,” says Mike Duke, Wal-Mart’s president and CEO. “And increasingly they want information about the entire lifecycle of a product so they can feel good about buying it. They want to know that the materials in the product are safe, that it was made well and that it was produced in a responsible way.”
I couldn’t agree more. And, what’s so significant here is that this initiative will be the big push we’ve needed to move “green” from marketing to measuring. There’s no question that the marketplace is full of misleading claims (greenwashing). With this index, however, the emphasis will be where it belongs: on life-cycle thinking. It will bring clarity, while revealing the fundamental role of the supply chain in every company’s sustainability efforts.
Wal-Mart will introduce the initiative in three phases:
In the first step, the company will conduct a survey of its more than 100,000 suppliers around the world. The survey includes 15 questions that will serve as a tool for Walmart’s suppliers to evaluate their own sustainability efforts. The questions will focus on four areas: energy and climate, material efficiency, natural resources, and people and community.
For the second step, Wal-Mart is working to create a consortium of universities that will collaborate with suppliers, retailers, NGOs and government to develop a global database of information on the lifecycle of products — from raw materials to disposal. Arizona State Univeristy (ASU) and the University of Arkansas will lead this sustainability consortium. Wal-Mart has provided the initial funding for the Sustainability Index Consortium, and invited all retailers and suppliers to contribute.
In the third step, Wal-Mart will translate the product information into a simple rating for consumers about the sustainability of products. This will provide customers with the transparency into the quality and history of products that they don’t have today.
Congratulations, one again, to Wal-Mart for their leadership. As I’ve said before, leaders by their very nature push the envelope and show a willingness to experiment with a wide variety of initiatives and strategies in the search for those that truly work. The breadth of Wal-Mart’s efforts on sustainability shows that they understand that this risk taking mentality is an implicit characteristic of leadership, and from my purview, they are certainly “walking the walk.”