Walmart has set itself the goal of cutting 20 million tonnes of greenhouse gas emissions from its global supply chain by the end of 2015 – one and a half times the company’s estimated global carbon footprint growth over the next five years.
Mike Duke, Walmart president and chief executive, said: “Reducing carbon in the life cycle of our products will often mean reducing energy use. That will mean greater efficiency and, with the rising cost of energy, lower costs, making our business stronger and more competitive. And, as we help our suppliers reduce their energy use, costs and carbon footprint, we’ll be helping our customers do the same thing.”
Walmart has been working with Environmental Defence Fund (EDF) to develop an approach that looks at the supply chain on a global scale. Other external advisers include PricewaterhouseCoopers, ClearCarbon Inc, the Carbon Disclosure Project and the Applied Sustainability Centre (ASC) at the University of Arkansas. This team will identify projects, quantify reductions, engage suppliers and ensure proper procedures are followed for each GHG reduction claim.
The programme has three main components:
Selection: Walmart will focus on the product categories with the highest embedded carbon. This is defined as the amount of life cycle GHG emissions per unit multiplied by the amount the company sells. To find the embedded carbon, the ASC reviewed the GHG emissions associated with all Walmart product categories. This approach ensures the project team focuses on the categories that have the greatest opportunity for reductions. Reductions can come from any part of a product’s life cycle.
Action: For a project to be included as part of this goal, it must reduce GHGs from a product in either the sourcing of raw materials, manufacturing, transport, customer use or end-of-life disposal. Walmart must demonstrate it had direct influence on the reduction and show how that reduction would not have occurred without Walmart’s participation.
Assessment: Suppliers and Walmart will jointly account for the reductions. ClearCarbon will perform a quality assurance review of those claims to ensure methodology, completeness and calculations are correct. When the claims meet the quality assurance check, PricewaterhouseCoopers will assess under consulting standards whether the defined procedures were followed consistently to quantify the reduction claim.
