Wal-Mart: A Green Company?
My father has been bugging me to read "The World is Flat", a book by Thomas L. Friedman. When I was down in Palm Springs recently, I finally picked up the book and started reading it. It is fascinating. I have not finished it, but the main premise is that the world has changed drastically over the last 10 years or so. Due to political, economic, social and technical forces, India, China and many other countries are becoming "part of the global supply chain for services and manufacturing." Increasingly jobs and products are moving to these areas of the world. This book talks about how this has happened, what may happen in the future and how people, companies and countries should react to these changes. The book is filled with interesting and thought-provoking ideas. After I have finished the book, I may do a blog post on a few of these ideas. However, I saw an article yesterday that fit in well with some of the themes in the book, so I thought I would write about that topic now.
In the book, Friedman suggests that Multi-National companies can have much more affect on the environmental and social issues than governments. In many countries around the world, farmers and factory owners frequently ignore or work around local government regulations. Yet if a large company such as HP or McDonald's says we will not buy from you unless you meet our regulations, then the local vendors will change to meet these regulations. And in fact this is happening.
McDonald's teamed up with Conservation International to create a set of environmental guidelines for a "socially responsible food supply." McDonald's then met with key suppliers and told them that it would not buy from them, unless they met these guidelines. HP, Dell and IBM have a similar alliance that has created an Electronics Industry Code of Conduct. It includes bans on hazardous materials, pollutants, as well as bribes, child labor, embezzlement and extortion and so on.
Both of these events are relatively new and it remains to be seen how effective they will be. In my mind, the biggest question is how well the guidelines will be enforced. However the events are highly encouraging and certainly a step in the right direction. Marc Gunther, a senior writer for Fortune magazine makes an interesting observation, "Even as America is supposedly turning conservative on social issues, big business is moving in the other direction."
Wal-Mart is a different case. As you probably know, consumer groups and the press have vilified Wal-Mart. Friedman also takes shots at the company in the book. He points out that Wal-Mart offers health care to only 45% of it's workforce, while it's biggest competitor (Costco) provides health care for 96% of its full and part-time employees. A North Carolina hospital found that 31 percent of it's Wal-Mart patients are on Medicaid, another 16 percent have no insurance at all. While Wal-Mart has lower prices than Costco, we have to pay higher taxes to support Wal-Mart's health care policies. Anyway, many see Wal-Mart as an evil company for a number of it's practices. When I 'googled' Wal-Mart, I found negative article after negative article.
Then yesterday, I opened the San Francisco Chronicle and found an article titled "For Wal-Mart, profit wears earthy green." The writer (Mark Morford) has been very critical of Wal-Mart in the past. In this article, he points out that "Wal-Mart's president, Lee Scott, delivered a "secret" speech to employees about "21st Century Leadership," in which he outlined a whole slew of what can only be called truly remarkable and potentially world-altering agenda items." It includes items like stores eventually supplied by 100 percent renewable energy, packaging with eco-friendly materials, selling 100 percent sustainable fish, experimenting with green roofs, corn-based plastics, and green energy. It goes on and on.
Wow- I think this is really exciting. Wal-Mart and McDonalds are seen as very conservative companies. If all or even a majority of Multi-National companies can adopt and enforce similar socially-aware programs, it could have a profound affect on social issues across the world. I think this could be much more effective than political solutions. They just don't seem to be working. Again, it is really early and you have to wonder if some of this is for PR reasons or financial reasons. Wal-Mart also pledged to double the fuel efficiency of its truck fleet within a decade. Did they do this for environmental or financial reasons? Personally, I don't really care, it will have a very positive affect on the environment, and so I am excited.
In summary, I think Friedman's book "The World Is Flat" is great and I whole-heartedly recommend it. It is one of those books that helps you see events in a different context. As an example, I saw the article in the Chronicle in the context of Big Business' becoming more socially aware and having a positive affect on social issues.
More info on the book can be found here.
The on-line version of the Chronicle article can be found here. Note that the on-line version has a different title "Can you still hate Wal-Mart? It's a shockingly eco-friendly plan from the world's most toxic retailer. Did hell just freeze over?"
In the book, Friedman suggests that Multi-National companies can have much more affect on the environmental and social issues than governments. In many countries around the world, farmers and factory owners frequently ignore or work around local government regulations. Yet if a large company such as HP or McDonald's says we will not buy from you unless you meet our regulations, then the local vendors will change to meet these regulations. And in fact this is happening.
McDonald's teamed up with Conservation International to create a set of environmental guidelines for a "socially responsible food supply." McDonald's then met with key suppliers and told them that it would not buy from them, unless they met these guidelines. HP, Dell and IBM have a similar alliance that has created an Electronics Industry Code of Conduct. It includes bans on hazardous materials, pollutants, as well as bribes, child labor, embezzlement and extortion and so on.
Both of these events are relatively new and it remains to be seen how effective they will be. In my mind, the biggest question is how well the guidelines will be enforced. However the events are highly encouraging and certainly a step in the right direction. Marc Gunther, a senior writer for Fortune magazine makes an interesting observation, "Even as America is supposedly turning conservative on social issues, big business is moving in the other direction."
Wal-Mart is a different case. As you probably know, consumer groups and the press have vilified Wal-Mart. Friedman also takes shots at the company in the book. He points out that Wal-Mart offers health care to only 45% of it's workforce, while it's biggest competitor (Costco) provides health care for 96% of its full and part-time employees. A North Carolina hospital found that 31 percent of it's Wal-Mart patients are on Medicaid, another 16 percent have no insurance at all. While Wal-Mart has lower prices than Costco, we have to pay higher taxes to support Wal-Mart's health care policies. Anyway, many see Wal-Mart as an evil company for a number of it's practices. When I 'googled' Wal-Mart, I found negative article after negative article.
Then yesterday, I opened the San Francisco Chronicle and found an article titled "For Wal-Mart, profit wears earthy green." The writer (Mark Morford) has been very critical of Wal-Mart in the past. In this article, he points out that "Wal-Mart's president, Lee Scott, delivered a "secret" speech to employees about "21st Century Leadership," in which he outlined a whole slew of what can only be called truly remarkable and potentially world-altering agenda items." It includes items like stores eventually supplied by 100 percent renewable energy, packaging with eco-friendly materials, selling 100 percent sustainable fish, experimenting with green roofs, corn-based plastics, and green energy. It goes on and on.
Wow- I think this is really exciting. Wal-Mart and McDonalds are seen as very conservative companies. If all or even a majority of Multi-National companies can adopt and enforce similar socially-aware programs, it could have a profound affect on social issues across the world. I think this could be much more effective than political solutions. They just don't seem to be working. Again, it is really early and you have to wonder if some of this is for PR reasons or financial reasons. Wal-Mart also pledged to double the fuel efficiency of its truck fleet within a decade. Did they do this for environmental or financial reasons? Personally, I don't really care, it will have a very positive affect on the environment, and so I am excited.
In summary, I think Friedman's book "The World Is Flat" is great and I whole-heartedly recommend it. It is one of those books that helps you see events in a different context. As an example, I saw the article in the Chronicle in the context of Big Business' becoming more socially aware and having a positive affect on social issues.
More info on the book can be found here.
The on-line version of the Chronicle article can be found here. Note that the on-line version has a different title "Can you still hate Wal-Mart? It's a shockingly eco-friendly plan from the world's most toxic retailer. Did hell just freeze over?"
posted by Steve @ 7:20 AM
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