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National Environmental Partnership Summit Baltimore, MD May 22, 2008 Using the Supply Chain to Achieve Sustainability in

National Environmental Partnership Summit Baltimore, MD May 22, 2008 Using the Supply Chain to Achieve Sustainability in the Retail Sector. Phyllis Harris Vice President Environmental Compliance Wal-Mart Stores, Inc. Bentonville, AR. Overview. Overview of Wal-Mart Sustainability

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National Environmental Partnership Summit Baltimore, MD May 22, 2008 Using the Supply Chain to Achieve Sustainability in

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  1. National Environmental Partnership SummitBaltimore, MDMay 22, 2008Using the Supply Chain to Achieve Sustainability in the Retail Sector Phyllis Harris Vice President Environmental Compliance Wal-Mart Stores, Inc. Bentonville, AR

  2. Overview • Overview of Wal-Mart Sustainability • Corporate Commitment • Internal Sustainability Goals and Targets • Energy Goals • Zero Waste • Supplier Partnerships and Sustainability • Product Management • Sustainability 360: “Pulling it All Together”

  3. Three Basic Beliefs: RESPECT for the Individual; SERVICE to Customers; and STRIVE for Excellence FORM the Cornerstone of Wal-Mart’s Environmental Policy and Guide our Daily Activities. In support of these beliefs, Wal-Mart Stores, Inc. commits to the following: Compliance with All Environmental Laws and Regulations; Provide Training and Support to Meet Our Environmental Commitments; Explore New Technologies to Reduce Pollution and Support Environmental Sustainability During Construction, Operation, Servicing, and Maintenance of Wal-Mart Facilities; Work with Suppliers to Fulfill Product Needs that are Environmentally Sustainable; Improve Environmental Performance by Setting, Measuring, Achieving, and Exceeding Our Objectives; and Promote and Encourage Open Communication with Regulators and Local Communities. Corporate Commitment

  4. Sustainability as a Wal-Mart Corporate Value “Our environmental goals at Wal-Mart are simple and straightforward: To be supplied 100 percent by renewable energy; to create zero waste, and to sell products that sustain our resources and the environment.” • Scope and Scale Presents Potential to Effect Positive Change • Opportunities to influence our own operations • Assume Leadership to Effectuate Change in the Business World by Using Supplier Relationships • Improves the quality of life for people around the world • Critical to Wal-Mart’s ability to grow and thrive as a company

  5. Business Integration of Sustainability • Corporate-wide Entrepreneurial Teams • Focusing on Key Networks • Packaging • Real Estate • Raw Materials • Setting Goals and Measuring Success • Partnering with • NGOs- • NRDC • www.18seconds.org • Regulatory Agencies • US EPA • DOE • States • Local Agencies

  6. Wal-Mart Footprint Energy Packaging Water Agriculture Direct = 8% Indirect = 92% Greenhouse Gas Facilities Marine Transportation

  7. To be supplied 100% by renewable energy • Existing stores 25% more efficient in 7 years; new stores 30% more efficient in 4 years • Trucks 25% more efficient in 3 years; 50% in 10 years To create zero waste • 25% reduction in solid waste in 3 years • All private brand packaging improved in 2 years To sell products that sustain our resources & environment • Align supply chain around sustainable product innovations

  8. Solar Power LEDs High-Efficiency Prototype Stores Energy Efficient Technologies

  9. Global Logistics Network • Improve fleet efficiency by 25% by 2008 • Double fleet efficiency by 2015 • Reduce facility-related carbon emissions

  10. Waste Reduction • Goal of Zero Waste • Promote the Development of Sustainable Packaging • Sustainable Packaging Scorecard • Tool for WM Buyers to make informed decisions regarding product packaging • 97,000 products entered into scorecard from 6371 distinct suppliers • Five Percent Packaging Reduction Goal by 2013 • Projected Results: • Elimination of 667,000 metric tons of CO2 • 213,0000 trucks off the road annually • 66.7 million gallons of diesel fuel saved • Innovations in Plastics Recycling • “Sandwich Bale” • Diverting plastics from landfills • Turning Trash into Cash • Good for business; Great for the environment, and Good for the Economy

  11. Zero Waste Sandwich Bale Kid Connection Private Brand Toy

  12. Sustainable Products: Supplier Partnerships • Marine Stewardship Council • Pledged to source all Wild-caught Fresh and Frozen fish for the North American market from MSC's Certified Fisheries- 5 year Goal • Organic Products • Promoting Use of Organic Farming Techniques, • Supporting 'Fair Trade' and 'Rainforest Alliance’ • Available at “Everyday Low Prices” • Sustainable Products Success Stories • Concentrated Detergents • CFLs • Preferred Chemicals Principles • Drive Innovation and Inspire Suppliers to Find Substitutes • Awareness • Action Plan • Recognition and Reward

  13. 25% of Laundry Detergents are Sold by Wal-Mart Bold Initiative to Sell Only Concentrated Liquid Laundry Detergent by May 2008 Three Year Estimated Savings 95 Million Pounds of Plastic Resin 400 Million Gallons of Water 520,00 Gallons of Diesel Gasoline 125 Million Pounds of Cardboard Concentrated Liquid Laundry Detergent

  14. CFLs use 75% less Energy Installing ONE CFL Prevents the Release of 450 lbs. of GHGs into the Environment 100 Million CFL Goal Reached in October 2007 Over the Life of 100 million bulbs $3billion Saving in Electrical Costs Prevents 20 million metric tons of GHGs into the Environment 700,000 Cars Off the Road Powers 450,000 Single Family Homes Wal-Mart/Supplier Partnership Reduced Mercury Content by 33% to below 5mg Compact Fluorescent Light Bulbs

  15. Product Management to Support Sustainability: The WERCS Process MSDS (Optional: Translated, Country Specific Template, GHS) Suppliers WERCS® MSDS Authoring / Classification Software WERCS Web Portal 24/7/365 Access RETAILER 48 Hour TAT .XML Safety Summary Sheet, MSDS.pdf, Regulatory Data

  16. Chemical “Screening Tool” Provides our buyers and suppliers a fully-transparent tool designed to help evaluate chemicals used in products; potentially reducing products that could pose environmental and/or health hazards.

  17. Actions to Green Chemical Inventories Aim for the Top Prefer chemical products that are fully assessed and that have low hazard and lifecycle benefits Practice Informed Substitution Process of continual improvement; toward more data and better understanding of whatis green and sustainable Bring up the Bottom Screen all chemicals against criteria for adverse impacts to human health and the environment to move away from the use of the most hazardous chemicals

  18. Sustainability 360: • Beyond Wal-Mart’s Direct Environmental Footprint • Engage 1.8 million Associates • PSP-Personal Sustainability Plan • Environmental, Health, and Wellness • Suppliers • Global Innovation • Challenge Suppliers to Remove Products Made with Non-Renewable Energy from our Shelves • Challenge Suppliers to Move Away from Products with High Hazards and Low Lifecycle Benefits • Communities • Using Sustainable Practices in New Markets • Jobs and Opportunities Zones • Announced New Store Openings in 10 Economically Challenged Areas • Sustainable Choices at “Everyday Low Prices” • CFLs • Concentrated Detergents • Organic Foods • Energy Efficiency Tools

  19. “Much work remains to achieve the goals we set for ourselves. Our carbon footprint is growing slower, but it is still growing. We are reducing waste, but we are far from the day when we have eliminated waste in our stores. Many of the products on our shelves can be made more sustainable. We are working to become more diverse and build more sustainable sourcing relationships. We hope that you will judge our commitment by our record. “ Lee Scott, November 15, 2007

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