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January 04, 2007


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Insightful comments all. Signs of Wal-Mart growing up are encouraging, and I do believe that Lee Scott does have a genuine, if pragmatic, commitment to environmental stewardship. But there are many measures of corporate social responsibility beyond environmental sensitivity. As pointed out in your comments, worker rights (Wal-Mart employees as well as its suppliers' employees) are an important measure as well. There are no shortage of Wal-Mart Watchdogs who will continue in their vigilence.

Wal-mart's problems are not in execution but in design. Everything they aim to achieve is good for Wal-mart and bad for just about everyone else...and before someone shouts "low prices for consumers" it would be good to look at the entire receipt to see just what we're paying in addition to those low prices.

The aforementioned "Wal-mart Effect" is a good example.

Given WM's history one needs to be a skeptic when they make the above claims.

My thoughts...

1. Environmental changes were not the biggest problems they faced. Human exploitation and a virtual gov't subsidy (health care)were. But now they have framed the conversation on an issue they feel they can win.
2. $4 Drugs. Great, but I don't see any change here - No one ever questioned their commitment to low prices.

3. Reduce energy use by 30%? Does anyone else picture rooms full of illegals peddling bicycle style generators?

4. Solid waste reduction in the stores? What are they going to do, lock up half of the toilets and send their employees out of the store when necessary?

5. Bulbs to reduce greenhouse gases. Hmmm, so if we buy more of WM's bulbs we'll be helping the environment - Not WM, the environment. Right.

So my impression is less of a company "stepping Up" then the scene from "Groundhog Day" where Bill Murray repeats aloud the things that Andy M. does not like in order to remember them the following day. He's not trying to become a better person, but he's learning these lessons so that he can be successful the next day in seducing Andy McDowell.

I agree with the author that Wal-mart has the ability to directly make an enormous impact on many social and environmental issues by attempting to minimize negative externalities associated with its operations as well as emphasizing its more eco-friendly products. However, this is just the tip of the iceberg. By leveraging its dominant position as the world's largest retailer to force its suppliers to conform to its own standards of energy efficiency and environment-friendly processes, Wal-mart could send a shock wave through the entire manufacturing sector and we would see an effect exponentially greater than its current efforts. Of course, doing so could threaten the very competitive advantage that has allowed the company to grow from a single store in Bentonville to the behemoth it is today; the ability to sell a wide variety of consumber products at the very lowest price.

Wal-Mart is a mammoth with the power to change a lot. It was they who introduced and continue to lead the best practices in inventory management and logistics.

However, their low wages and poor contributions to employee benefits remains Wal-Mart's largest detriment to society. Although good hearted efforts to bring great change through volume are well applauded, this issue should not fade away.

They are a major force in life. An excellent reportage of this company can be found in Charles Fishman's "The Wal-Mart Effect".

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