Friday, July 07, 2006

Does Walmart Care About Your Town, or Money?

Now that Walmart's grasp on the region will be complete once it is open in Steelyard Commons, what kind of center should expect when it's doors open. Will it be the kinder and genler walmart the pr machine would have us think? Or, will it be business as usual (hear the sound of mom-and-pop store fronts shutting down with months after the grand opening)
Allthough this is going to happen anyway - people will always want to find the least expensive gadget's made in China - the press will have you think the company really does care about the towns, cities, and communities they move into.
Maybe it is real.

From the Wall Street Journal:
Wal-Mart Warms to Al Gore

Former Vice President and environmental activist Al Gore is planning to address Wal-Mart Stores Inc. executives next week at the retailer’s quarterly conference on sustainability, part of the company’s recent efforts to become an environmental leader, a Wal-Mart spokesman confirmed.

Gore will speak on global warming, the subject of his recently released documentary “An Inconvenient Truth.” The conference is an outgrowth of Wal-Mart’s mission, outlined by Chief Executive Lee Scott last November, to minimize its negative impact on the environment. At the time, Wal-Mart committed to, among other things, reduce energy use in its stores, improve the fuel efficiency of its truck fleet and substantially cut down on solid waste produced by its stores.

Wal-Mart has seized on the issue of sustainability in an effort to bolster positive public relations at a time when its various business practices have been heavily criticized, from its worker pay and health benefits to its effect on smaller retailers. Still, the company has attempted to make changes. For example, it outfitted its trucks with an alternative power unit that uses 90% less fuel than its engines do while idling. The company created 14 internal networks to explore and implement more environmentally sound business practices. The 14 groups, made up of both Wal-Mart executives and outside experts, focus on different business areas, including operations and logistics, food and agriculture, textiles, global greenhouse gas and jewelry and mining.

Called the sustainable value network, the groups meet individually throughout the year. They also hold their own conferences. Last month, for instance, Wal-Mart held a two-day conference on sustainability and textiles. It brought together Wal-Mart executives, environmental consultants and members of nonprofit groups to discuss issues surrounding organic textiles, including certification and standards. Next week’s meeting, held at the company’s home office in Bentonville, Ark., is one of four where all the company’s internal groups working on sustainability issues get together to discuss progress, stumbling blocks and other issues. –Ann Zimmerman

This is one month after hiring the Rocky Mountain Institute as a consulatant. From the Benton County Daily Record in Arkansas.

BENTONVILLE — As the world’s largest retailer embarks on a mission to go green, the company has recognized a need to call in the professionals.

The Rocky Mountain Institute, a research and consulting organization based in Snowmass, Colo., has a consulting contract with Wal-Mart on two primary areas, according to Cory Lowe, RMI’s outreach coordinator. The company primarily provides consulting work to large companies and government entities.

In logistics, Wal-Mart is seeking to double the efficiency of its trucking fleet. "They have one of the largest trucking fleets in the country," Lowe said. "The best truck in their fleet gets roughly eight miles per gallon. We’re going to help them double it."

Besides moving product, Wal-Mart also wants to make its physical real estate energy efficient. "The second part is helping them to redesign some of their stores to make them more energy efficient," Lowe said. "They spend lots and lots of dollars every year on heating and cooling costs. By making (the stores) energy efficient, they’re going to cut down on their costs. They’re seeing it as a good business decision and an environmental decision."

That, in essence, is RMI’s goal — to show companies that going green can also be a good business decision. "Our mission is to help show people that they can continue to live sort of a modern and comfortable life but do it far better in terms of energy efficiency and cut down their impact," Lowe said. "We’ve been criticized a few times for working for Wal-Mart — but our CEO feels strongly that because Wal-Mart has such a large market share that if they can decide to do things better, it can really have a huge impact."

In the business world, everything comes down to the dollar figures. "We’re making a business case, especially to these big, big clients," Lowe said. "If we can’t talk in terms of dollars and cents and how it affects their bottom line, we’re not going to be effective."

The RMI Web site discusses community design and transportation solutions in Smart Growth development patterns. Smart Growth encourages walkable, compact, mixed-use developments.

A team of architects and designers are working on the nuts and bolts of designing green buildings for Wal-Mart, Lowe said — but they’re stopping there, and following their contract. "We’re presenting some ideas and showing Wal-Mart how they can do things any better," Lowe said. But the designers are not redesigning entire Wal-Mart sites to make them more Smart Growth-oriented or pedestrian friendly.

In traditional Smart Growth design, buildings are pushed up to the street, with parking in the rear. That allows pedestrians, cyclists and other transit types to safely function in conjunction with automobiles. "We’ve worked on some Smart Growth issues in other applications, but with Wal-Mart it really hasn’t come into play," Lowe said. With Wal-Mart, RMI is focusing on the components of the building, not the way it addresses the street.

Wal-Mart is often criticized for furthering sprawl, in which automobile-dependent development spreads out from city edges, gobbling acres of green land. If all customers are forced to drive to the stores, the impact on the environment could still be substantial.

RMI bases its consulting work on a concept called Whole Systems Design, which incorporates different realms of thought — engineering, environmentalism and architecture, for example — to solve a problem. The organization is a natural-resource think tank. The company is also well known for the book "Natural Capitalism," which was published in 1999 by the two founders of RMI, Amory Lovins and L. Hunter Lovins, and author Paul Hawken. "The basic idea for the whole book is basically that by addressing a problem, you need to address a lot of different areas, or areas of thought," Lowe said. "Problems don’t exist independently of each other." "As outlined in our book ‘Natural Capitalism,’ RMI knows that least-cost enduse includes the significant improvement of public transportation, as well as alternatives to actual transportation, such as intelligent community design, Smart Growth and telecommuting, among others," the company’s Web site states.

So will RMI try to influence Wal-Mart with its Smart Growth background? Probably not, Lowe said. "We haven’t addressed that with them at all," he said. RMI is staying within the lines of its contract. "We feel like if we overstep our bounds and make too many recommendations, we may not have the opportunity of working with them at all," he said. "The scope of this project has been fairly detailed in those two components," he said, referring to trucking and green construction. "We haven’t really spread beyond it at all."

The company probably won’t press the issue, according to Lowe. "Wal-Mart approached us and said, ‘Here’s what we think you can help us on.’ We haven’t reversed it and said, ‘Here’s what we think you can do better.’ It may very well be at the end of this project, Wal-Mart says, ‘ Hey, you did great work; what’s next, what do you think?’" he said.
One month before this, Walmart CEO Lee Scott met with the Seventh Generation CEO Jeffrey Hollender.
You can read Hollenders account here (it is long):

Does this mean Walmart has decided to take a more sustainable approach to it business philosophy, or are they just concerned with the bottom line?
Maybe both.