Author, Force of Nature
Wal-Mart is not a sustainable company, says author Edward Humes. But the mega-retailer is making money by investing in sustainability.
The story of how Wal-Mart made the pivot toward green is one well told by Humes, Pulitzer Prize-winning journalist and author of the new Force of Nature: The Unlikely Story of Wal-Mart’s Green Revolution. Humes recounted the tale to a Climate One audience on May 16, in San Francisco.
The unlikely hero is Jib Ellison, an elite river guide-turned sustainability consultant. Ellison had founded the consultancy BluSkye and was looking for his first client. Through connections, he wrangled a meeting with then-Wal-Mart CEO Lee Scott. Ellison’s message for Scott: Wal-Mart’s practices are riddled with waste – energy, water, and materials – and it’s costing you money. The retort: Prove it.
A series of early successes won over Scott and, it’s not a stretch to say, changed the direction of the company. Wal-Mart added auxiliary generators to its 7,000-truck fleet; drivers no longer had to endlessly idle dirty diesel engines. Fuel savings netted the company hundreds of millions of dollars.
Next, someone suggested that a toymaker reduce the size of the box holding a toy truck. With a smaller box, more toy trucks could be packed into each shipping container. One year, and 497 avoided shipping containers later, Wal-Mart had saved $2.5 million on fuel and materials. Yes, $2.5 million is a pittance for Wal-Mart, but it would have to sell $60 million in toy trucks to net that same $2.5 million, Humes said.
“That was an early proof of concept that doing something that was lowering the footprint and more sustainable – baby steps, obviously – had a big return,” he said.
Executives now asked, “‘What if we go across all of our products and start looking for those kinds of opportunities,’” said Humes. “And it began to snowball. It stopped being a hippy proposition that some river guide came up with, and started being more of a no-brainer business proposition.”
When Climate One’s Greg Dalton asked the inevitable question about greenwashing, Humes was ready. “It sounds like we’re up here singing Wal-Mart’s praises.” But, he went on, “this isn’t a chorus of ‘Wal-Mart is fabulous.’ It’s a very specific change in the way they’ve decided to do business, which is to try and be more sustainable because it makes economic sense to do so.”
Humes credited Lee Scott and Wal-Mart for giving peers cover to follow their lead. “They made it safe for other companies to have the same conversation about sustainability because they’ve shown maybe it’s not so crazy and risky after all. I think they are a large reason why sustainability is even a word that big businesses talk about.”
For Humes, the stakes are too high to quibble over Wal-Mart’s motivations. “I think they’ve been pretty careful about saying, ‘We’re not a green company.’ They never will be a green company. They’re an out-sourced, big-box retailer that wants you to buy ever-more amounts of stuff,” he said.
But “if you’re driving 60 miles-an-hour towards oblivion and slow the car down to 20 miles-an-hour, is that a good thing? I think it is.”
And the messenger matters. “It’s not Al Gore saying sustainability is good for the economy. It’s the reddest red state company there is saying it,” said Humes.
“It’s an exact counterpoint to much of the rhetoric coming out of Washington about green being a job-killer and a drag on the economy.”
– Justin Gerdes
May 16, 2011
Photos by Sonya Abrams
The Commonwealth Club of California