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Thinking outside the box

Big-box retailer Walmart set an ambitious goal to reduce its carbon emissions. Then it encouraged its suppliers to do the same.

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When Jerry Allen Newby reaches down and scoops up a handful of earth on his family’s farm, the rich, red, silty soil clumps together in his palm. He crumbles it, and it falls through his fingers back to the ground. It’s good soil. But that wasn’t always the case. After seven generations of farming, by the 1990s this land in Limestone County, Alabama—originally a land grant made after the War of 1812—had begun to deteriorate. The topsoil was compacted. It had dried out. It eroded more easily and had become less productive. In the mid-1990s, Newby’s grandfather, father, and uncle started experimenting with no-till farming. Among their cattle pastures and fields of cotton, corn, and wheat they also planted cover crops of oat, rye, and radish. These practices allow the living, organic components of soil to grow, increasing its capacity to hold water and reducing the need for fertilizer. “You can see those roots in the soil and feel where they’re growing into it,” says Newby, who now runs the farm with four other family members. “All that breaks down and makes stronger soil as it decays.” When the Newbys adopted no-till and cover crops into their farm management practices, the ideas were novel. As Newby says, “We’ve always tried to be in the group that will try new things.”

Like most farmers, the Newbys never knew where their commodity crops went after they sold them. That changed recently when Wrangler, the American jeans and workwear manufacturer, started to look more closely at the cotton in its garments. Today the Newby family farm is again trying something new, working with Wrangler on a pilot program to track and calculate how practices like no-till and water and fertilizer management can increase the soil’s capacity to hold carbon and reduce the greenhouse gas emissions that contribute to climate change.

Through the program, 40,000 pounds of the Newbys’ cotton will be traced from farm to garment—used to make a special collection of Wrangler jeans that will be sold in farm and ranch stores and eventually at Walmart and elsewhere. “We’re happy to work with Wrangler, share what we’ve learned, and maybe make it easier for other growers to transition to these practices,” said Newby at the project’s launch.

Getting other growers to adopt such practices could have a big impact on greenhouse gas emissions. Roian Atwood, director of sustainability at Wrangler Jeans, is betting on it. Atwood says half the cotton used to make Wrangler jeans is grown in the US, and working with cotton farmers here to improve soil health has the potential to both reduce emissions and sequester millions of tons of carbon.

Newby Farms, Wrangler, and Walmart form the links of a supply chain increasingly focused on reducing greenhouse gas emissions. As part of a new initiative, Walmart, with help from WWF and others, is putting its legendary buying power to work, encouraging and empowering its suppliers to implement best practices and do the hard work of quantifying reductions in greenhouse gas emissions.

Walmart calls the initiative Project Gigaton. Its aim is to avoid emitting 1 billion metric tons—or 1 gigaton—of carbon across Walmart’s global supply chain by 2030. That’s roughly equivalent to taking 211 million cars—or most of the cars in the US—off the road for a year.

What’s more, if all goes to plan, Project Gigaton stands to transform business as usual.

THE BIG SIX

Companies can join Project Gigaton by submitting to Walmart either emissions targets or goals that fall into one or more of the following categories. Learn more at walmartsustainabilityhub.com. Companies are asked to report on progress annually.

1. Waste

Companies are encouraged to reduce emissions from waste, including food waste, which may occur in the company’s own  operations or after a product is purchased.

2. Agriculture

Best-in-class farming practices, such as precise targeting of fertilizers, can reduce costs, improve water quality, and reduce emissions.

3. Energy

Energy costs such as electricity or vehicle fuel often represent one of the highest costs of doing business. Energy emissions can be addressed by increasing efficiency and transitioning to renewable energy sources.

4. Deforestation

Walmart is working with suppliers on a variety of efforts to reduce deforestation, including supporting better sourcing of commodities and improving supply-chain accountability.

5. Product Use

Companies can set a goal to improve the energy efficiency of their retail products, passing along energy savings to consumers.

6. Packaging

By reducing packaging, sourcing sustainable packaging materials, and supporting recycling, companies can reduce waste and make products lighter to ship; both reduce greenhouse gas emissions. 

Product Shots © David Arky/WWF-US and Prop Styling by Kellie Murphy

Climate Action

Walmart, the world’s largest retailer, has been focused on climate change for well over a decade. In a landmark speech in 2005, its CEO at the time, H. Lee Scott, Jr., said about climate change: “The science is in, and it is overwhelming. We believe every company has a responsibility to reduce greenhouse gases as quickly as it can.”

That year, the country had witnessed the devastation wrought by Hurricane Katrina, seen as a harbinger of climate impacts to come. While government relief efforts faltered, Walmart, with its vast retail network, mobilized 2,450 trucks to distribute supplies to hurricane victims, itself donating 100 truckloads. “Climate change doesn’t cause hurricanes, but hot ocean water makes them more powerful,” said Scott. “Climate change doesn’t cause rainfall, but it can increase the frequency and severity of heavy flooding.”

Scott laid out a series of environmental commitments, including a pledge to transition Walmart to 100% renewable energy. Since then, Walmart has made significant advances: working to get solar panels installed on hundreds of its buildings—including more than 360 in the US—and doubling the efficiency of its transportation fleet.

“Scott’s ambitious commitment set Walmart on a journey few could envision at the time,” says Marty Spitzer, WWF’s senior director of climate and renewable energy. “But it achieved something invaluable: It rallied the company around a goal that has driven innovation and action.”

“The business community sees climate change as bad for business and is stepping up through innovation, investment, and action on critical areas such as science-based targets and renewable energy.”

Sheila Bonini
WWF Senior VP, Private Sector Engagement

Fast-forward to today, and “they’ve become really systematically dedicated to reducing emissions—something we’d like to see more companies embrace,” says Spitzer.

Spitzer points to Walmart’s involvement in the Renewable Energy Buyers Alliance, led by a coalition of nonprofits including WWF, to help satisfy the demand for renewables from large energy buyers. “Walmart’s been there the entire journey,” Spitzer says.

Walmart now gets more than a quarter of its power from renewable sources, and in 2017 announced that it would achieve 50% of its energy from renewables by 2025. “We’re halfway there,” says Joby Carlson, director of energy and operations sustainability for the company.

But while Walmart and many other companies have moved decisively to address climate change—proving they can transition to a lower carbon footprint and not only maintain their edge but sharpen it—some US government leaders have moved in the opposite direction. In June 2017, President Trump announced his intention to withdraw the US from the historic Paris Agreement, in which signatory nations committed to cutting emissions to keep the planet’s average temperature from warming 2°C, or 3.6°F. The Paris deal would “undermine our economy,” Trump said. Today, the US is the only country to have rejected the agreement.

“Since the US announced its intent to pull out, there has been a renewed sense of urgency by the business community to deliver on the promise of the Paris Agreement,” says Sheila Bonini, WWF’s senior vice president of private sector engagement. “The business community sees climate change as bad for business and is stepping up through innovation, investment, and action on critical areas such as science-based targets and renewable energy. As the federal government is pulling away from the climate dialogue, American business is taking on the mantle of climate leadership.”

Walmart was one of the early companies, following Trump’s announcement in June, to sign on to the “We Are Still In” declaration coordinated by WWF and others. Signatories (now more than 2,500 strong) represent US cities, states, businesses, universities, and faith communities dedicated to tackling climate change and meeting the US commitment under the Paris Agreement.

With Project Gigaton, Walmart has invited its supply chain, including companies like Wrangler and Newby Farms, to help shoulder that mantle of leadership. After all, in making its own commitments and crunching the numbers on its own goals, Walmart was faced with a sobering reality: Ninety percent of the company’s greenhouse gas footprint occurs within its supply chain.

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Marty Spitzer, WWF director of US climate and renewable energy policy, and Katherine Neebe, Walmart's director of sustainability, visit the roof of Walmart in Maryland laden with solar panels.

The Big Idea

“Supply chains are the new frontier of sustainability,” said WWF president and CEO Carter Roberts at Project Gigaton’s launch. “The journey products take from source to shelf will collectively shape our planet’s future.”

Project Gigaton is a call to action to Walmart suppliers—and a road map. “We try to inspire people,’” says Zach Freeze, senior director for strategic initiatives at Walmart, who has largely been responsible for the project’s rollout.

Walmart worked with WWF, Environmental Defense Fund, and others to design the project and to develop methodologies to quantify emissions-reduction goals in six areas: energy, agriculture, waste, packaging, deforestation, and product use. A tool kit and online resources aid suppliers in setting targets and goals, which they enter on Walmart’s Sustainability Hub website

Matt Banks, the former manager of business engagement for the WWF climate change team, helped Walmart suppliers with their goal-setting, and he designed some of the resources on the Sustainability Hub. Banks, who worked for 15 years at WWF to advance corporate leadership on climate change, recognizes the potential impact of the project. “They don’t think of Project Gigaton as just their goal,” he says. “It’s a universal goal to help work on the climate challenge.”

For Walmart, cutting emissions is a strategic decision like any other. “The driver has been the business case,” Spitzer says. A 2013 report published by WWF and CDP (formerly Carbon Disclosure Project) quantified that upside for businesses. Called The 3% Solution, the analysis demonstrates that for the US corporate sector (excluding utilities), cutting greenhouse gas emissions by 3% year over year could generate savings of up to $780 billion over 10 years from reduced energy bills, increased productivity, and other associated benefits. Case in point: Walmart’s Carlson notes that when the company halved its transportation fleet’s vehicle emissions, it also netted a billion dollars in savings. That’s a huge driver for more change.

In Project Gigaton, Walmart has created a program that’s entirely voluntary but that encourages suppliers to do more—and taps in to their inherent competitiveness. When the company unveiled the details behind the project at its annual Milestone Summit in April 2017, executives of some of the world’s largest corporations stepped up to the challenge—and challenged one another.

At the summit, General Mills CEO Jeff Harmening pledged to contribute more than 5 million tons of CO2 reductions to Project Gigaton—part of the company’s objective to reduce emissions by 2050. He had barely finished his sentence when Unilever’s Kees Kruythoff, president of North American operations, doubled that pledge.

Other suppliers—the Colgate-Palmolive Company, Dairy Farmers of America, Kimberly-Clark, Land O’Lakes—made commitments as well.

But while many of Walmart’s large suppliers have already been working on reducing emissions for years, for others the concepts are still new, says Laura Phillips, senior vice president of global sustainability at Walmart.

“We’ve had some smaller suppliers enter really small things,” says Phillips, of the Sustainability Hub. “But we love it,” she adds. “Because if they start really small, what we hope is that one small step will lead to another and to another, and give them a chance to really learn and get engaged more broadly.”

“It’s a big tent,” Phillips says, “and we want everybody in it.”

 

The Big Tent

With Project Gigaton, Walmart is once again testing the power of an audacious goal to rally support and drive innovation.

Suppliers are responding. “I’ve had company leaders say to me directly, ‘Thank you, we wanted to do this. We weren’t sure this was the right timing. Now that you’ve come out and said it, we’re in,’” says Phillips.

And it’s not just Walmart’s direct supply chain that’s feeling the impact of Project Gigaton. Competitors, says Walmart’s Zach Freeze, are feeling emboldened too.

“At a sustainability conference, a competitor came up to us and said, ‘Oh now that you guys have set this climate target, our executives are all in,’” Freeze says. “Publicly announcing a climate target is now not taboo.”

As for Wrangler, brand president Tom Waldron announced at the Gigaton launch that the company would source 100% renewable energy for all of its owned and operated facilities by 2025. Wrangler is also still preparing an emissions-reduction goal. And that’s for all the right reasons. The science on the relation between soil health, farm management, carbon sequestration, and greenhouse gas emissions is still being developed, and Wrangler is working with the Soil Health Institute to figure out how to quantify the outcomes of sustainable soil practices like those on Newby Farm.

For Jerry Allen Newby, the work he’s doing with Wrangler and Walmart makes business sense and is all to the good: “Honestly? It’s saving us money, but on the flip side it’s doing good in a lot of different ways.”

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