Sustainability and System Change
Wal-Mart’s Pioneering Strategy
Frank Dixon
(Published on CSRwire.com, April 18, 2006)
On October 24th, 2005, Lee Scott, CEO of Wal-Mart, gave one of the most important business speeches ever. In it, he committed the largest company in the world to making zero waste, using 100% renewable energy and selling sustainable products. The implications are huge. These goals cannot be achieved without broad systemic changes in areas including supply chain, regulatory and consumer awareness. To achieve its goals, Wal-Mart is integrating system change efforts into its sustainability strategy. By doing so, it is pioneering what may be the first sustainability strategy that actually has the potential to achieve sustainability (sustainability relates to ensuring society survives and prospers over the long-term).
This article discusses the need to better address systemic issues that essentially compel all firms to negatively impact society. It also describes why sustainability will be the competitive advantage strategy of the 21st century and how Wal-Mart is capitalizing on this opportunity.
System-Watch
All companies produce negative environmental and social impacts. As companies impact the closed
Earth system, pushback from the system is inevitable. This pushback can take the form of activist campaigns. As the largest company in the world, Wal-Mart has high environmental and social impacts.
Several activist efforts have arisen in response to these impacts, including the recent film Wal-Mart: the
High Cost of Low Price. Activist efforts probably were one factor in Wal-Mart’s decision to adopt an aggressive sustainability strategy.
Activist campaigns have driven large improvements in society. Many of the environmental and social improvements over the past 50 years were initiated by such efforts. Now it appears a partial