Walmart Working on Sustainable Suppliers Index
July 20, 2009,
In a move that could have a profound impact on the global supply chain, Walmart announced plans to develop a worldwide sustainable product index that will stand as a single source of data for evaluating the sustainability of products.
"Customers want products that are more efficient, that last longer and perform better," said Mike Duke, Walmart'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.
The company believes such expectations will be ongoing, he added.
Walmart will first survey its more than 100,000 suppliers around the world, asking 15 questions to help suppliers evaluate their own sustainability efforts. The questions will focus on four areas: energy and climate; material efficiency; natural resources, and people and community.
"The survey will include simple but powerful questions covering familiar territory, such as the location of our suppliers' factories, along with new areas like water use and solid waste," said John Fleming, chief merchandising officer, Walmart U.S.
The retailer's top U.S. suppliers have been instructed to complete the survey by Oct. 1. Walmart will establish deadlines on a country-by-country basis for all other suppliers.
As phase two of the program, the company is helping create a consortium of universities to collaborate with suppliers, retailers, NGOs and government to develop a global database of information on the lifecycle of products — from raw materials to disposal. Walmart has provided the initial funding for the Sustainability Index Consortium. All retailers and suppliers are allowed to contribute.
Walmart will also partner with one or more leading technology companies to create an open platform that will power the index.
"It is not our goal to create or own this index," said Duke. "We want to spur the development of a common database that will allow the consortium to collect and analyze the knowledge of the global supply chain. We think this shared database will generate opportunities to be more innovative and to improve the sustainability of products and processes."
Once the index has been established, technical product information will be translated into a simple rating system so consumers can check out the quality and history of products in the database.