Walmart’s New Supplier Sustainability Index: The Tipping Point?

Walmart has announced sustainability information reporting that will be required by suppliers in order to continue doing business with the world’s largest retailer.  The business community is all a-buzz about Walmart’s launch of their Sustainable Product Index.  See Walmart’s web announcement.

The company will introduce the initiative in three phases.  The first phase will include asking their suppliers to complete a survey of 15 questions (due to Walmart by October 1, 2009) that will serve as a tool for Walmart’s suppliers to evaluate their own sustainability efforts (see attached). The questions will focus on four areas: energy and climate; material efficiency; natural resources, and people and community.

Phase two is a to help create a consortium of universities that will 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, and invited all retailers and suppliers to contribute. The company will also partner with one or more leading technology companies to create an open platform that will power the index.

The final phase in developing the index will be to translate the product information into a simple rating for consumers about the sustainability of products.

Given Walmart’s scale, the impact this program could have is enormous. They have now launched ‘the compass’ as to where the retail industry must head to become more sustainable, as well as continue their business relationship with the world’s largest retailer.

One of Elm’s sustainability team members, Liz Muller, was a participant in Walmart’s waste minimization and energy efficiency supplier guides.

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