Wal-Mart's Sustainability Strategy (A)
In October 2005, in an auditorium filled to capacity in Bentonville, Arkansas, Lee Scott, Wal-Mart’s president and CEO, made the first speech in the history of Wal-Mart to be broadcast to the company’s 1.6 million associates (employees) in all of its 6,000+ stores worldwide and shared with its 60,000+ suppliers. Scott announced that Wal-Mart was launching a sweeping business sustainability strategy to dramatically reduce the company’s impact on the global environment and thus become “the most competitive and innovative company in the world.” He argued that, “Being a good steward of the environment and being profitable are not mutually exclusive. They are one and the same.” He also committed Wal-Mart to three aspirational goals: “To be supplied 100 percent by renewable energy; to create zero waste; and to sell products that sustain our resources and the environment.” Against this backdrop, the case introduces Andrew Ruben, vice president of corporate strategy and business sustainability, and Tyler Elm, senior director of the same group. Ruben and Elm, who were chosen by Scott to lead the sustainability strategy, recognized that they needed to keep environmental improvement tightly coupled with business value and profitability for the strategy to succeed. The case describes Wal-Mart’s efforts to accomplish this, focusing on three of the company’s primary focus areas (seafood, electronics, and textiles) and their effect on the company’s operations, supplier relationships, and results. It also explores how Wal-Mart is measuring and communicating its ideas about sustainability to its suppliers, associates, customers, and the public.