Wal-Mart Unveils Sustainability Index

The Sustainability Index lets customers compare products’ environmental credentials.

| August 2009 Web

  • Wal-Mart unveiled plans for a new sustainability index at a meeting of suppliers and university members.
    Photo Courtesy Wal-Mart

When Wal-Mart speaks, the world listens. In July the retail giant spoke loudly. Its plan to create a Sustainability Index has the potential to transform—for the better—the way our products are made and sold. Wal-Mart will evaluate every product’s environmental impact throughout its entire life cycle, from raw materials to disposal, and condense the data into an easy-to-understand rating for consumers.

Because this project is so large, Wal-Mart plans to implement it in three phases. Wal-Mart sent a 15-question survey to its 60,000 suppliers. The survey evaluates a company’s sustainability in four areas: energy and climate; material efficiency; natural resources; and people and community. Wal-Mart has asked its U.S. suppliers to return the completed survey by October 1. (While the surveys are a good step, they’re still missing some key data. The questions under “people and community,” for example, don’t address wages, health care or the right to air grievances—all standard worker’s issues.)

The second phase will create a Sustainability Index consortium of universities from across the country that will build and oversee a global product life-cycle database, and the third phase will create a consumer rating system. The database isn’t expected to be fully implemented for at least five years.

For now, consumers will be able to see the companies’ ratings online, but eventually Wal-Mart hopes to have an easier, in-store system.

Currently, Wal-Mart is evaluating companies rather than individual products. Eventually, it will address sector-specific questions, comparing agricultural products, jewelry, electronics and more.

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