WalMart's carbon ultimatum  

The Business Spectator reports that WalMart is looking to exert pressure on its suppliers to reduce embedded carbon emissions in the products it sells - WalMart's carbon ultimatum.

Last week, the world’s largest retailer, WalMart, laid down a challenge to its more than 100,000 suppliers around the world: it told them it intends to cut 20 million tonnes of carbon dioxide emissions from its supply chain within five years.

Whatever you think about the course of international climate change negotiations or even of a domestic cap-and-trade policy in the US, when the largest company and biggest private employer in the world’s biggest economy decides that its long term competitiveness, value and costs will gain from a lower carbon footprint, then it is likely to have just as big an impact on global commerce and goods and the further development of energy efficiency and sustainability.

The $US405 billion retailer is the first to address its supply chain on a global scale, although other corporate leaders such as the carpet group Interface have also looked to cut their emissions dramatically through the supply chain.

WalMart estimates that 90 per cent of its carbon footprint comes from the supply chain, and this move will add to other measures it has taken on its own emissions, which include the installation of solar energy sources on top of its stores and sourcing power from wind turbines as it seeks a move to 100 per cent renewable energy, and take a whole range of other environmental measures.

The US Environmental Defense Fund, which has helped Walmart shape its policy, said it would have the effect of launching “a race and a treasure hunt among its suppliers to reduce carbon”.

A pilot scheme had already proved successful, with 28,000 tonnes of greenhouse gas emissions eliminated last year because its DVD supplier, Fox Home Entertainment, reduced packaging.

Walmart’s other major suppliers include the likes of Procter & Gamble, Unilever, Coca-Cola, PepsiCo, Kraft, Sony, Apple, HP, and Dell – a who’s who of the US’ largest corporates who will now have to focus on their own carbon emissions, and look to use less energy, do more recycling and make things more efficiently. It is very likely to have a cascading effect through the economy.