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Climate change has been in the headlines a lot recently. The National Climatic Data Center announced that 2012 was the warmest year in the U.S. since national record keeping began in 1895. In last night’s State of the Union address, President Obama declared “for the sake of our children and our future, we must do more to combat climate change.” And CDP has recently released a report revealing that 70 percent of companies believe that climate change has the potential to significantly affect their business or revenue.
But all of this is old news for Walmart, a company that is already well on its way to reducing its direct and indirect impact on climate change. Since 2005 the company has been disclosing its progress annually through CDP, the largest global system for natural capital disclosure. In 2010, when Walmart committed to cutting 20 million metric tons of greenhouse gas emissions from its global supply chain by 2015, it turned to CDP Supply Chain to engage its largest suppliers and drive innovation in reducing greenhouse gas emissions.
Addressing the world’s largest retailer’s carbon footprint is no small feat, but with aggressive targets to reduce emissions, and the guidance and infrastructure of CDP, it is not an impossible one. The collaboration simplifies reporting for thousands of suppliers globally by giving them one place to report all climate data, and many of them report to several customers at once through this system. Plus, the unified platform empowers Walmart to efficiently capture the positive impact the company is having throughout its supply chain.
Through this process, CDP and Walmart give suppliers a framework from which they can better understand their own corporate risks related to climate change as well as the rewards they can reap for a job well done. As suppliers implement and report emission reduction activities, Walmart will track qualifying projects that contribute to the company’s aggressive 20 million metric ton goal. Best practice examples will be featured on Walmart’s sustainability hub as guides for others to follow. A recent interview with Rob Kaplan, senior manager of sustainability at Walmart, provides further information for suppliers who wish to submit best practices and share success stories.
In 2012, Walmart requested climate change disclosures from 3,000 of its largest suppliers by spend through CDP’s platform. Of the 1,100 suppliers who submitted responses, 58 percent of them reported more than 2,400 greenhouse gas emission reduction activities through CDP. Of these initiatives, 640 (27 percent) will pay back within the year and 1,247 (52 percent) will have a payback period of three years or less. This means that Walmart’s suppliers of all sizes and sectors still have ample “low hanging fruit” to capture when it comes to realizing energy efficiency opportunities and making more sustainable choices. Together, CDP and Walmart are working with suppliers of all types of products – from toothpaste to lawn mowers to video games – to measure, manage, reduce and report their impact on climate change.
