State of Green Business
Home Depot’s circle in the box store
Home Depot’s circle in the box store
This article is adapted from GreenBiz's newsletter Energy Weekly, running Thursdays. Subscribe here
For millions of homeowners and DIYers across the country, Home Depot is the go-to spot for building supplies. The corporation is the sixth-largest retailer in the world, with almost 2,000 locations in the United States alone.
That gives Home Depot tremendous influence over the sustainability — and education — of products used from hobbyists to contractors.
The company says it’s been working hard to align the company to do its part on environmental social and governance — or ESG — targets, a fast-rising metric companies are using to communicate impacts to the public and investors.
Most recently, Home Depot has been thinking about how to design circular economy ideals into its operations. The company recently added "circularity" to Eco Options, a program that identifies products with less environmental impacts than comparable standard products, giving shoppers the ability to evaluate products based on attributes such as design, manufacturing and recyclability.
At the front of this push is the company’s chief sustainability officer, Ron Jarvis. I caught up with Jarvis at the Greenbuild conference and talked to him about the company’s circular economy objectives and the store’s responsibility in influencing consumer behavior. (Full disclosure, Home Depot invited me to the conference and paid for the trip.) Below are excerpts of my conversation with Jarvis, edited for length and clarity.
Sarah Golden: I know you’ve spoken to GreenBiz before and you’ve told us a little about Home Depot’s circularity goals and your vision around circularity. Since we spoke, what has been happening?
Ron Jarvis: Well, first of all, we added circularity into our pillars inside of Eco Options, so now inside of Eco Options we have six pillars, and one of them is circularity.
We are just young enough to know how naive we are in circularity. Understanding that there are a lot of different aspects inside of circularity. A lot of folks look at recycling and say, "OK, this is circularity." We know it’s not. It’s more about the design principles, manufacturing and the reuse of the product. So we’re deep into it, and learning every day.
Golden: How are you using your position as a buyer to help influence your supply chain and start to think about circularity from the beginning of the life cycle?
Jarvis: It’s not as hard as it used to be. It used to be more of a pull factor. Fortunately, a lot of our suppliers are all over this as well, and they have R&D groups that are working on the design, the manufacturing, the use and reuse of their products. So they’re coming to us as well, about us having pull, showing us projects they’re working on. We know this is a marathon and not a sprint, and it’s going to be years in the making. So the dialogue is probably the thing that is most important right now just to make sure that as engineers and architects and designers of the future, as they’re working on products, this is in the back of their mind.
Golden: You mentioned Eco Options. I’d love to hear more about that program. How is that going, do you feel like consumers are responding to it?
Jarvis: We’re at $10 billion in sales of Eco Options products. For us, it’s a strong internal program because it helps us identify products that we can put into a, not really a safe zone, but a zone we know someone is working on it, we’ve worked on it, we have criteria and indicators around those products. We consider it to be a huge success, or we wouldn’t add circular economy to it.
Golden: What about the consumers? Are people responding to Eco Options?
Jarvis: People respond to the environmental attributes of Eco Options. They walk in, they don’t want to see a sign down the plumbing aisle that says, "This toilet is great for the environment." They want to see a sign that says, this toilet saves you $100 a year and 4,000 gallons a year. And by the way, it’s Eco Options.
Golden: In thinking about environmental attributes, how are you communicating to the consumers that the attributes are impactful?
Jarvis: Some of the products have more attributes that are a bigger concern to the consumers, like saving money and saving water. We find that most of our consumers are looking at those attributes first. "If I buy this product, can I have less energy use in my store? Can I reduce the operating cost of my home on a monthly basis?"
It’s interesting, when you look across America, people want to do the right thing; they are concerned about environmental attributes. But you have pockets of people who focus on specific attributes, like water savings. So they wanna know, for the product, what kind of water savings it has. We put that information on the website and places like that where they can find it.
Golden: When I think about many DIYers and homeowners across the United States, Home Depot is probably the No. 1 interface they have with supplies that they’re building and living with. Do you feel a responsibility to nudge consumers?
Jarvis: We’ve tried nudging, we’ve tried kicking, we’ve tried dragging. With Eco Options, we have labels, and it’s $10 billion. But we’re a $100 billion company, so that means 90 percent of the store has something else besides a certified label.
We realized a lot of the customers, you shouldn’t have to nudge, you shouldn’t have to push — just change your assortment. Just give them the right product.
That’s why when you go into the plumbing aisle, 100 percent of our shower heads are WaterSense certified. You can’t buy a non-WaterSense certified shower head in our stores. So that takes the nudging out.
Golden: So I know that Home Depot recently got some disappointing news around sales figures for Q3, and I know the company is reexamining sales targets. Would shifting targets potentially impact your sustainability targets?
Jarvis: Home Depot has eight core values. You know, "taking care of the customers," "taking care of our associates." One of those is "doing the right thing." There’s not an asterisk next to "doing the right thing — only when you’re making a sales plans." So no, it doesn’t affect it.
Editor’s note: Two weeks ago, I traveled to Atlanta (on Home Depot’s dime) to visit the Greenbuild conference, an event billed as the largest gathering of green building professionals. While I went to hunt down a couple of energy questions — I was keen to see how the movement to electrify gas appliances would be represented on the expo floor (it wasn’t) — I didn’t get many energy-oriented takeaways. The circular economy, however, made a strong showing at Greenbuild, with manufacturers understanding the framework in a way that felt new and profound; back to energy next week.