Retailers are driving sustainability through their supply chains from the top down, making significant demands on their suppliers to meet aggressive environmental and social goals.

But how well are the world's largest retailers walking their talk on CSR issues? A new report from Five Winds International and GreenBiz.com, explores how well retailers are doing, and what factors are driving sustainability performance for retailers of all sizes.

The report, "Retail: A Sustainability Benchmark," applies Five Winds' CSRInsight benchmarking tool to nine of the world's biggest retail corporations, and finds that, by and large, they are meeting their sustainability goals quite well.

Based on the more than 500 sustainable business practices included in the CSRInsight evaluation -- broken down into categories and subcategories for environmental, social and governance performance -- Marks & Spencer and Tesco are doing the best work in meeting their sustainability goals.

As the chart below shows, Walmart placed a close third in the overall rankings, while Home Depot and Loblaw round out the top five.


But when the individual groupings of sustainability criteria are highlighted -- environmental, social or governance -- a slightly different picture appears. The figure below shows that, when looking solely at the environmental performance of these retailers, M&S, Tesco and Walmart still lead, but Home Depot moves from fourth to last place.



"Based on our analysis, the companies studied appeared most focused on climate change, ethical sourcing and supply chain impacts of products," the report's authors write. "This is likely due to customer demand for action in these areas, as well as the retailers' efforts to reduce their business risks and costs."

In applying the CSRInsight model to these nine retailers, Five Winds broke down the internal and external factors that are most likely to shape a retail firm's sustainability profile:

• Employees
• Communities
• Sustainable Product Development
• Competitors
• Green Buildings
• Transportation and Logistics Costs
• Carbon Efficiency
• Rising Demand for Certified Products
• Expectation for Reporting and Performance Measurement
• Product Safety

Although the companies in this report are performing well overall, Five Winds' researchers found that the social category was a weakness among almost all the retailers.

{related_content}The notable exception was Tesco, which the authors write, "provided evidence of relationships with various unions and publicly states that 'Employees across our business are free to join unions, and we have an industry leading partnership agreement with Solidarity in Poland and Usdaw in the UK.'"

The full report, "Retail: A Sustainability Benchmark," is available for free download from GreenBiz.com. It is the second in a series of three reports from Five Winds International this year. The first report, "Retail: A Pivot Point for Sustainability," was published in March.

For more information about Five Winds International's work on retail sustainability, visit FiveWinds.com.