Mothers and CEOs: Why Corporate Sustainability Reports Matter

Walmart has just released its report on Corporate Sustainability—the “Global Responsibility Report”.

Nicknamed the GRR, the joke around my office is that “GRR” sounds like a growl—GRRRR. But while its seventy-three dense pages might seem daunting, the GRR is anything but scary. In fact, from my perspective as both a mother and someone with unique access to the day-to-day workings of Walmart, I have to say that it’s a must-read.

Why? Because like all corporate sustainability reports, the GRR tells the story of how big business is—or is not—adjusting their operations to help the planet and its inhabitants.

And by inhabitants I mean you. And me. All of us.

Meet Super-Eco-Business-Mom When new mom JENNY AHLEN feeds her daughter, she may also be pondering this question: how do we feed a global population expected to reach nine billion people by 2050? That’s because Jenny is also EDF’s team lead for their partnership with Walmart, which gives her both a unique perspective and a unique power. She knows the stakes are high for the world her daughter will grow up in. But Jenny is in a position to do something about it. Thus, she spends her days working with the world’s largest retailer trying to figure out the best approach to “fertilizer optimization”: the science behind increasing yields while reducing the environmental impacts of crop production. How did Jenny arrive at this nexus of the nursery and contemporary eco-business?

To all the mothers of the world: like you, I want the best for my child. While there are many things we can’t control about our kids’ world, we do have power over things like what goes in and on their bodies, which toys can help them learn, and how to create a safe and loving environment for them to grow. Knowing what’s in these sustainability reports means knowing whether the stores and brands we choose every day are working with us, or making our job harder.

To all the C-suite executives: See above. Mothers everywhere are starting to demand both transparency and action around creating a healthier world for our kids. We are your customers, and we’re sending you a demand signal to make us happy.  Coincidentally, it can make your business more efficient, more profitable and more resilient—all things that your shareholders will love to hear. Believe me, you want to be able to issue a sustainability report that’s both real and robust.

So if the GRR is Walmart’s report card on global responsibility, how did they do?

There’s a lot in the document, but after a quick scan of the sections that fall within my area of expertise, I’d have to say: they’re making a lot of progress—probably more than most of their peers.  Two areas that stand out are:

  1. Climate Change:
  • In their direct operations, Walmart reports that their U.S. truck fleet efficiency has doubled since 2005, eliminating 650,000 metric tons of greenhouse gases since 2015. Those numbers are impressive.
  • Outside of their own operations, it’s now fairly well known that six years ago Walmart set a goal of removing 20 million metric tons of greenhouse gases from their supply chain. They not only achieved but surpassed that goal—36.5 million metric tons have been removed to date. That’s the equivalent of over 39 billion pounds of coal left unburned, and that is amazing. It proves that setting audacious goals can deliver real results.
  1. Transparency and Quality of Products:
  • In 2013, Walmart committed to “reduce, restrict and remove use of high-priority chemicals using informed substitution principles”. The GRR reports that they’ve achieved a “95% reduction by weight in Walmart U.S.”. Translating that into plain English, that means a lot of things you didn't want to be in your products have been taken out. This is a big deal—and the first time that a major retailer has attempted something so daunting.

With each of these accomplishments come questions—and a realization that significant work remains.  Those fleet numbers, for example, are focused only on the trucks they own. As the mix of online versus bricks-and-mortar shopping continues to evolve, is enough being done throughout their entire transportation system to optimize efficiency?

And in terms of the chemicals: how did they arrive at that number, and where are the names of the offending chemicals? My inside sources expect that both will be released soon—to which I say “we expect nothing less”. Like any parent, I won’t think enough has been done on this issue until I can buy any product on the shelf and not worry that it could have an adverse effect on my child. When will that day come?

In any case, the few examples I’ve cited are just the tip of the GRR iceberg.  I encourage you to find yourself a comfy chair, settle in, and explore it for yourself.

But as you read, try to remember that, just as no parent is perfect, neither is any one company. My takeaway is that Walmart is sincere in its efforts to tackle the extremely complicated job of helping to make the world a better place for our children. And their approach—employing science-based processes that are scalable and focused on areas core to their business—is precisely why Walmart can lay claim to being a leader in their field.

Mothers and CEOs, take note.


Follow Jenny Ahlen on Twitter – @JennyKAhlen


 

 

How helping a multi-billion dollar company (aka Walmart) is like raising a child

When it comes to Walmart meeting its greenhouse gas goal, parenting and sustainability have more in common than you think.

Notes from the Nursery/Eco-Business Nexus

I’m proud to say that Walmart just announced that they’ve not only hit but surpassed a goal that was, at the time, considered nothing short of audacious: to reduce global greenhouse gas emissions (GHG) by 20 million metric tons (MMT) in just six years.

So why am I proud? Two reasons.

First, I’ve worked alongside them every step of the way. Environmental Defense Fund (EDF) has been Walmart’s lead partner throughout this process, and as a Supply Chain specialist for EDF, I know first-hand the massive amount of research, measurement, innovation, collaboration and communication that has gone into bringing this goal across the finish line.

Second, I’m a brand new mother – and as I stare down into my 5-month-old daughter Helen’s eyes, there’s nothing I care more about than ensuring she grows up in a world that is on course to thrive—both economically and environmentally.  Walmart’s achievement gives me hope for both.Helen and Jenny

So, yes, I’m proud. Because while it may seem that my two unique perspectives—one from the nursery, one from inside the halls of the world’s largest retailer—are worlds apart, they actually have a lot in common. Read more

How Campbells is Helping to Make Sustainable Growing the New Normal

There’s a lot of momentum in the sustainable agriculture world. We helped Walmart discover that fertilizer runoff is a significant source of greenhouse gas emissions in its supply chain, and they’re now working with suppliers to improve the way grain is grown across the U.S. That’s because half of all fertilizer applied to crops runs off the field, leading to water pollution, aquatic dead zones that kill marine life, and contributing to climate change – since the nitrogen in fertilizer runoff converts to nitrous oxide, which is 300 times more powerful than carbon dioxide.

Major food companies are also recognizing that increased weather variability from climate change can cause supply chain disruptions, that their customers are demanding transparency for how their food was grown, and that it’s in their best interest to meet retailers’ demands for sustainably grown grain.

Campbells

That’s why Campbell’s Soup has focused on growing its vegetables as sustainably as possible, and why its Pepperidge Farm subsidiary is now investing in wheat sustainability in their Ohio and Nebraska sourcing areas.

My colleague Suzy Friedman, director of agricultural sustainability at EDF, recently interviewed Dan Sonke, manager of agricultural sustainability at Campbell’s, to get his take on this unprecedented momentum. Below are the highlights of their conversation on why his company is working with farmers to reduce environmental impacts, what they’re hearing from customers, and about why sustainable grain is becoming the new normal. Read more

Gaining Momentum for Optimized Fertilizer Use in Agriculture

Jenny AhlenIn 2013, Walmart launched an initiative with the potential to optimize fertilizer use on 14 million acres of U.S. farmland by 2020. This was a great step in the right direction for reducing greenhouse gas emissions and water pollution by improving nitrogen fertilizer use. Momentum on this work grew in April when Walmart suppliers including Cargill and General Mills stepped up and made joint agricultural commitments at Walmart’s Sustainable Product Expo.

Now, a little over a year since this work kicked off, it’s great to see another major boost of momentum. On Monday, Walmart hosted their fall Milestone meeting, which included an announcement from United Suppliers to join the fertilizer optimization work – committing to enroll 10 million acres by 2020.

This is a big deal for two reasons. First, this commitment is significantly larger – more acres – than any other we’ve seen so far. Second, this is the first time a major agricultural retailer has joined this initiative.

Read more

Fertilizer and Feeding the Planet’s Growing Population

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Last week, Walmart hosted its first Sustainable Product Expo, an event that brought together CEOs and sustainability leaders from some of the retail chain’s biggest supplier companies. Leaders from General Mills, Cargill, Dairy Farmers of America and PepsiCo, among others, joined Walmart on stage to celebrate the progress they’ve made in increasing the sustainability of their operations, and to make new commitments to cut greenhouse gas emissions and other environmental impacts.

Walmart set the stage for this in 2010 by announcing their goal to reduce 20 million metric tons (MMT) of greenhouse gas (GHG) emissions from their supply chain by 2015. As of 2013, Walmart and their supply chain have eliminated 7.5 MMT of GHG emissions and have projects underway to reach 18 MMT by 2015. The key to meeting and exceeding this goal is swift and thorough follow-through on ambitious initiatives.

That’s why EDF is working closely with Walmart to help their suppliers optimize fertilizer use in their supply chain. Emissions that result from nitrogen fertilizer loss – a greenhouse gas called nitrous oxide – is 300 times more potent in damaging our climate than CO2. Walmart’s Director of Dry Grocery Tim Robinson mentioned at the Expo that 20 to 40 percent of the nitrogen fertilizer isn’t absorbed by crops, either running off into waterways or off-gassing into the atmosphere. Consequently, as the top grocer in the country, this makes fertilizer optimization one of Walmart’s major opportunities for GHG reductions in their supply chain.

Just as importantly, the UN estimates that to feed the world’s growing population, food supplies will need to increase 70% by 2050. The entire value chain needs to produce more food with fewer inputs, while still allowing farmers to earn a living with what they grow. Walmart’s suppliers’ commitments are a first step towards this future:

Cargill

“By 2020 we will double our NextField acres bringing us to over 1 million acres of total land being optimized for maximum productivity with minimum environmental impact.”

DFA

“…we will have more than 90 percent of our 9,000 member farms participating in our Gold Standard Dairy program, which focuses on resource efficiency and optimization” and are “[a]igned with industry goals to reduce environmental footprint 25% by 2020."

Kellogg Company

“In every country in which Kellogg sources rice globally, we commit to promoting and supporting initiatives with producers that will, by 2020, lead to a 25% increase in the adoption of Climate Smart Agriculture (CSA) practices.  This will improve smallholder livelihoods, enhance producer resilience and reduce greenhouse gas emissions."

Pepsi

“…we will work to engage growers of corn, oats, potato, and oranges to increase sustainable farming practices, particularly in the areas of environmental, social and economic sustainability.  As part of this worldwide program, PepsiCo's Sustainable Farming Initiative (or equivalent scheme) will be expanded to 500,000 acres of farmland in North America by the end of 2016."

Campbell Soup Company

“We commit to reducing GHG emissions and water use by 20% per tonne of food for Campbell's 5 key agricultural ingredients (Tomatoes, Carrots, Celery, Potatoes, Jalapenos)."

General Mills

“We will: 1) Expand 2.5x the acreage enrolled in The Field to Market sustainable agriculture initiative to 2.5 million acres by 2015; 2) Leverage General Mills' strength in connected innovation to match grower nitrogen management needs with the best global solutions; and 3) Co-sponsor an innovation challenge for the innovators and farmers who demonstrate the most promise to reduce GHG emission in nitrogen management.”

With their commitments, Walmart’s suppliers are setting new targets to strive for, and we at EDF are seeking to provide farmers with the tools they’ll need to meet them. With effective fertilizer management, we can help scale up crops to meet food needs around the world while minimizing their impacts on our climate and water resources.

EDF Highlights Important New Fertilizer Strategies at Walmart Sustainability Milestone Meeting

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At today’s Walmart Sustainability Milestone Meeting, EDF Vice President Tom Murray brought welcome attention to strategies farmers are implementing to more precisely match fertilizer use with the amount their crops need.

In a question and answer session with the head of Walmart's U.S. grocery business, which accounts for roughly half the retailer's sales and approximately a third of all U.S. grocery business, Tom commended the excellent work many farmers are already doing to get this balance right, and called on other retailers and suppliers to engage in this effort. Read more

Powering Up: Walmart plans to install more solar panels and moves closer to its goal

Walmart recently announced plans to install solar panels on all remaining eligible Walmart store locations in California, bringing the grand total to more than 130 stores by the end of 2013.  Each installation will provide approximately 20 to 30 percent of that location’s needed electricity and will produce 600,000 kilowatt hours of clean, renewable electricity annually.

At Environmental Defense Fund (EDF), we’re excited to see Walmart take this step toward harvesting the business and environmental opportunities of solar technology while continuing to move toward its goal to be powered 100 percent by renewable energy.

Solar Power is Coming of Age…

A report released this month by Lawrence Berkeley National Laboratory details the dramatically changing landscape and growing opportunities for solar power.  Specifically, it reports that the average net installed cost of photovoltaic systems on commercial property fell by 22 percent in 2010 alone.  Additionally, the report states that financial incentives have played a significant role in driving the solar industry in the United States.  In fact, the data demonstrates that as the cost of solar installations continues to decline, so too does the value of available incentives.

While we all have seen the substantial coverage of solar manufacturer Solyndra declaring Chapter 11 bankruptcy and shuttering its manufacturing facility, what many have not acknowledged is that Solyndra’s failure is in some part due to increased price pressure from government-supported competitors in China.  The controversy surrounding Solyndra’s loan guarantee from the U.S. Department of Energy has distracted us from having a conversation about the continued need for policy makers in the U.S. to support renewable energy like solar in ways that allow it to be more competitive with dirty energy.

EDF and Walmart are working together because we both see the market potential for solar.  Walmart wants cost-competitive, reliable clean power for its stores.  And EDF wants to leverage Walmart's ability to bring renewables to the mainstream faster than they otherwise would.

… But We're Not There Yet

The decrease in incentives signals that policy makers believe solar power is on its way to becoming more cost competitive with traditional energy sources, and so less support is necessary.  While on a macro level that premise makes sense, it’s important to preserve and adjust renewable energy incentives in a measured and calculated manner that allow markets and competition to flourish.  The energy Walmart will purchase in California is cost-competitive with conventional electricity rates because SolarCity, the vendor who will source, install, own and maintain the solar panels, will receive incentives.

Right now, Walmart and other companies pursuing solar technology cannot do it alone. Renewable energy like solar will not flourish and be competitive with dirty, traditional forms of energy if utilities, states and the federal government step away from their vital role of enabling our clean and self-reliant energy future.

Walmart's showing leadership.  It's time for our country to do so, too.

Unpacking the Complexities of Packaging at Walmart's Sustainable Expo

Week three on the job at Environmental Defense Fund (EDF) and I had the opportunity to attend Walmart & Sam’s Club 6th Annual Sustainable Packaging Exposition in Rogers, Arkansas.  The expo is part of Walmart’s efforts to reduce five percent of packaging in its supply chain by 2013 (based on a 2008 baseline).  It acts as a forum for product suppliers, packaging suppliers, and other stakeholders to exchange information on the latest in sustainable packaging needs and innovations.

Being new to both EDF and Walmart, I think I expected the expo to answer many of my packaging questions, like which type of plastic is the best for food and beverage containers and how do we improve recycling rates?

Boy was that a misguided expectation.  Don’t get me wrong, the expo was great.  My disappointment lies in the fact that there are no clear, easy answers where packaging is concerned.  Instead, there is a myriad of packaging options, each with different attributes in terms of performance (i.e., properly protecting the product), raw-materials sourcing, post-consumer waste, etc.

For example, is it more important for the packaging to be light weight or easily recyclable?  Is it better to promote packaging that may be manufactured from GMO corn but has terrific recycling properties, or “compostable” packaging that requires virgin raw materials?

That being said, there are lots of exciting ways Walmart’s suppliers are changing packaging to lessen its environmental and economic impacts.  One of the best success stories I saw at the expo was by Alpha Packaging and its new bottle design for Gumout Fuel Injection Cleaner.  By making the product twice as concentrated and switching from PVC bottles (which are not recyclable) to much smaller bottles made from PET (which is recyclable and has 30% post-consumer recycled content) it reduced product weight by 42% and 51% for large and small bottles, respectively.  This means a truck filled with new 6 oz products (formerly 12 oz) went from carrying 61,200 bottles to 153,600!

Even though the expo didn’t meet my [unrealistic] expectations, I’m already looking forward to next year’s so I can see how this ever-changing landscape has continued to evolve.

And maybe a few more of my questions will be answered…