New Wal-Mart Leadership: Seemingly Small Town Change Has Big Time Impact

New Wal-Mart Leadership: Seemingly Small Town Change Has Big Time Impact

With the country abuzz about the power shift in our nation's capital, the town of Bentonville, Arkansas, is preparing for change with global implications. On February 1, Lee Scott stepped down after almost a decade as CEO of Wal-Mart, ceding the reigns of power to Mike Duke. Outside of the recent change at 1600 Pennsylvania Avenue, this could be one of the most significant transitions of 2009.

The CEO of Wal-Mart is a big job. The company's annual revenue exceeds $370 billion -- greater than the GDP of all but the 20 largest economies in the world. Each week nearly 200 million people walk into a Wal-Mart store. The products on Wal-Mart's shelves originate from over 60,000 suppliers around the globe. As a result, the company has an enormous environmental impact.

In 2005, Lee Scott laid out three bold environmental goals for Wal-Mart: Create zero waste, be supplied by 100 percent renewable energy and sell sustainable products. Environmental Defense Fund (EDF) and other organizations recognized this historic opportunity to work with the world's largest retailer to help it reach these impressive goals. If Wal-Mart is successful in meeting these goals, we will accomplish nothing short of a radical transformation of supply chains worldwide.

The ultimate success or failure of Wal-Mart's sustainability efforts will likely be formed during the tenure of Duke as CEO. Given the seriousness of the climate crisis today, failure is not an option. Working with groups such as EDF, Wal-Mart must dramatically reduce the level of emissions being poured into the atmosphere from the manufacturing and transport of the products it sources. At the same time, we must encourage Wal-Mart -- and other companies of its size -- to push for innovative, environmentally-sound technologies and products that will revitalize our failing economy, getting us back on the road to growth.

The good news is that Wal-Mart has made some praiseworthy progress in the past few years. The company has set impressive goals for the efficiency of its fleet and stores, jumpstarted the market for compact florescent light-bulbs, squeezed liquid laundry detergent into more compact packaging and laid the groundwork to drastically reduce plastic bag waste. Wal-Mart has also built a strong team of associates working to meet Scott's goals and has started asking questions about the environmental footprints of its products. We are also heartened by Duke's leadership on this issue to date, as illustrated by the powerful talk he gave to Chinese suppliers last fall, urging them to face up to their environmental responsibilities.

But there is still a long road ahead. Wal-Mart's growth means that its greenhouse gas footprint continues to increase. Some products on Wal-Mart's shelves contain chemicals that could harm human health or the environment or for which safer substitutes exist. And suppliers from China and other developing economies spew ever-increasing amounts of toxins into their local environments, contributing to respiratory ailments among local populations.

To address these and other environmental threats, Wal-Mart can take important, concrete steps now. Most immediately, the company must make a commitment to reduce the greenhouse gas pollution from its operations and its network of suppliers. Equally urgent, Wal-Mart must establish a system for comprehensively evaluating the environmental and life-cycle impacts of its products.

Wal-Mart can ultimately meet the three bold goals proclaimed by Scott, but it will take a strong, determined effort by all Wal-Mart associates and an unwavering commitment by Duke. Many suppliers and groups such as EDF stand ready to work collaboratively with Wal-Mart to ensure a cleaner planet, a healthier population, and high-quality affordable goods Product by product, innovation by innovation, we commit to working with Duke both as Wal-Mart's chief executive officer and chief environmental officer. In doing so, we can put this small town transition of power to work for us all.

Gwen Ruta, vice president for Corporate Partnerships at Environmental Defense Fund, spearheads its work with leading multinational companies to develop innovative, business-based solutions to environmental challenges and to drive change through the corporate value chain.