Walmart’s Sustainability Index

Fast Company, last week, reported that:

"Activity and skepticism have been the first by-products of Walmart's audacious plan to create a label that would tell a shopper the environmental toll of every product it sells, from the greenhouse-gas emissons of an Xbox to the water used to produce your Sunday bacon."

I went to the supermarket yesterday with a question in the back of my mind – could I usefully use another label to help make shopping decisions? I've already written about Ethiscore and the way they rank ethical companies (this time I did buy the Equal Exchange tea!). I always scan labels for nutritional content – I like Michael Pollan's (author of In Defense of Food and The Omnivore's Dilemma) 7 'rules' for food buying and consumption. Two of which I bear in mind when I'm food shopping:

  • Don't eat anything your great grandmother wouldn't recognize as food. "When you pick up that box of portable yogurt tubes, or eat something with 15 ingredients you can't pronounce, ask yourself, "What are those things doing there?" Pollan says.
  • Don't eat anything with more than five ingredients, or ingredients you can't pronounce.

I've also written about the way we make decisions. So I was wondering whether another label would be overwhelming. One question came to mind – where would yet another piece of information go on the packaging (or on the info if you're buying non-packaged stuff?) What would actually be useful in helping form a buying decision? The Fast Company article touches on some of these questions.

But companies are just beginning to grapple with the big questions. "One fear is figuring out who gets to prioritize the different pieces of sustainability," says Karen Hamilton, VP of vitality and environment at Unilever, a consortium member. "Who's to decide if greenhouse-gas emissions are more pressing than water conservation?" (Walmart provided initial funding for the Sustainability Consortium)

Walmart's own site has much information on the Sustainability Index and in a video presentation by Mike Duke (Walmart CEO) more detail is given on why Walmart feels this is an important initiative. He makes the point that there are other sustainability assessments available but they are, to his mind, lacking in some dimensions.

I did a (very brief) comparison between the Walmart assessment – for products – and the Dow Jones Sustainability Index – for companies – Dow Jones notes that:

Leading sustainability companies display high levels of competence in addressing global and industry challenges in a variety of areas:

Strategy: Financial: Customer & Product: Governance and Stakeholder: Human (Note each of these is explained in more detail)

Corporate sustainability performance is an investable concept. This is crucial in driving interest and investments in sustainability to the mutual benefit of companies and investors. As this benefit circle strengthens, it will have a positive effect on the societies and economies of both the developed and developing world.

Reading the Dow Jones information and listening to Mike Duke the messaging is virtually identical and the two indexes ask many of the same questions. So what information would I be interested in as I shopped for products and what company would I prefer to buy products from? And should a company interested in the sustainability of the products it sells also have a sustainability 'gold star' for it self?

Duke makes the point more than once that with the Sustainability Consortium ("a collaborative effort") he is looking to develop a 'transparent, common, standard, global database' not "to create our own database" to help consumers make informed choices . But consumers are interested in different aspects of sustainability and while one is interested in food miles, another may be interested in labor conditions.

The Good Guide – yet another site that assesses products – has a cool new feature where you can create your own lists of favorite products – or products to avoid. And then publish these lists in a simple "widget"
format on any blog or website.

What makes this, and similar, assessments important for organization designers – and not just shoppers – is that it is likely to make businesses really look closely at the way they are organized to meet the criteria. If Sustainability Indexes take off it will mean significant redesign for many organizations as they jostle to remain on supplier lists and high in the minds of consumers.