Walmart Supplier Greenhouse Gas Innovation Program
In February of 2010, Walmart committed to reducing 20 million metric tons of carbon dioxide equivalents (CO2e) from its products’ lifecycles and supply chains between calendar year 2010 and 2015. That is equivalent to the annual greenhouse gas (GHG) emissions from 3.8 million cars.
EDF collaborated with Walmart to develop and execute a program that is rigorous, credible and practical. Other advisers to the project include ClearCarbon Inc., PricewaterhouseCoopers, the Carbon Disclosure Project, and the Applied Sustainability Center (ASC) at the University of Arkansas. Together, the team will identify projects, achieve and quantify reductions, engage suppliers and ensure proper procedures are followed for each GHG reduction claim.
ABOUT THE PROGRAM The Walmart Supplier GHG Innovation Program has three main components:
1. Selection: Walmart will focus on the product categories with the highest embedded carbon. This is defined as the amount of life cycle GHG emissions per unit multiplied by the amount of units the company sells:
To find the embedded carbon, the ASC reviewed the GHG emissions associated with all Walmart product categories. This approach ensures the project team focuses on the categories that have the greatest opportunity for reductions. Reductions can come from any part of a product’s life cycle.
2. Action: For a project to be included as part of this goal, it must reduce GHGs from a product in either the sourcing of raw materials, manufacturing, packaging, distribution, customer use, or end-of-life disposal. Walmart must demonstrate it had direct influence on the reduction and show how that reduction would not have occurred without Walmart’s participation. To accomplish the GHG reduction goal of this program, Walmart can undertake three types of projects:
- Inspire the creation of and/or increase the sales of new “lower-carbon” products
- Improve existing products and/or sell more of improved-version products, or
- Improve facilities or processes for a supplier
3. Assessment: Suppliers and Walmart will jointly account for the reductions. ClearCarbon will perform a quality assurance review of those claims to ensure methodology, completeness and calculations are correct. When the claims meet the quality assurance check, PricewaterhouseCoopers will assess the process and methodology surrounding the measurement of the carbon emissions reduction claims for use by Walmart management.
THE GUIDANCE DOCUMENT Looking deep into the supply chain and across product lifecycles for potential carbon pollution reduction wins is innovative and uncharted territory. The cross-organizational team working on this project has spent months creating a detailed guidance document about what can count towards Walmart’s goal, as well as how reductions should be quantified and confirmed. We’re committed to making this project as transparent as possible, which is why we’ve publically released the guidance document. This document describes the Walmart Supplier GHG Innovation Program, the supplier GHG reduction goal, the accounting guidance for projects as well as the due diligence process for reviewing these projects. This document is intended for practical use by Walmart Project Champions, the Walmart Supplier GHG Innovation Program team and others within Walmart.
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