The Path to Becoming a Regenerative Company

Q: How is Walmart applying the principles of a regenerative enterprise, particularly in Mexico and Central America?

A: In 2020, CEO Doug McMillon launched an ambitious initiative that marked a turning point for Walmart. The company has been committed to the planet and the community for many years, achieving notable advances, such as diverting 80% of waste from landfills and using over 50% renewable energy in our operations. But by 2020, we recognized that these efforts were not enough. The planet is at a critical point as the damage caused by human activities is becoming irreversible. Companies, governments, societies and individuals worldwide have contributed to this situation and it is imperative that we redouble our efforts to fix this problem.

Our new ambition is to transform into a regenerative company that places nature and humanity at the center of its business practices. Regeneration is about restoring, renewing and conserving our planet. We need to decarbonize and eliminate waste from our operations and from much of our supply chain. We must also adopt regenerative practices throughout our value chain, including as it relates to agriculture, forestry and fisheries. We must promote prosperity and equity for our customers, employees and everyone who is part of our value chain. This can only be achieved through strategic partnerships with suppliers, customers, NGOs and authorities.

We have over 40,000 suppliers in Mexico and Central America. With more than 230,000 employees, we serve 6 million customers daily through our over 3,000 physical stores and numerous e-commerce platforms. Any initiative we undertake has a significant multiplier effect.

Q: How is Walmart tailoring its regenerative strategies to create economic opportunities for associates, local suppliers and communities?

A: The Mexican countryside is affected by climate change, security issues and difficulties in accessing formal markets. Since 2011, we have developed the “Small Producer” program, which seeks to provide direct access for small farmers to formal markets, eliminating intermediaries and ensuring fair payment for their products. We work in collaboration with NGOs that provide training and technical assistance in seed quality, crop rotation and post-harvest management, promoting responsible use of agrochemicals and water.

The results have been encouraging. Last year, we benefited over 3,800 producers, generating purchases totaling MX$586 million (US$32.6 million) for them. This represented a 78% increase in their average income and the creation of over 7,300 jobs, of which 680 went to female producers. Over 26,000 tons of products were marketed. We do not require exclusivity from these small producers, allowing them to access other formal markets and helping reduce food waste.

We have also developed platforms tailored to different types of suppliers. For example, we have the “Adopt an SME” program, which identifies an SME in our value chain that has potential for growth in the self-service category. A category buyer adopts one of these SMEs and provides personalized follow-ups. We offer consultations, advice and programs with preferential rates to help these SMEs increase their sales by 50% during the 18-month program, which takes place every year with an average of 25 to 30 SMEs participating each year. 

We are also answering to the growing environmental awareness of the Mexican consumer. We observed that many customers are taking their first steps to protecting the planet through recycling. In 2019, we launched the “Reciclamanía” initiative in collaboration with suppliers, placing containers in our stores to encourage customers to bring in their waste, which we then recycle.

Q: How do Walmart’s partnerships with Mexican NGOs or local stakeholders allow it to push forward meaningful projects?

A: Without our partnerships, it would be impossible to implement these strategies. For example, we have the goal of reducing food waste in all our stores. In nearly 100% of our stores, we donate products that are not suitable for sale but are still consumable. We also give fruits, vegetables and bread to our employees to supplement their daily meals. What is not donated to our associates is donated to food banks. We have partnerships with over 100 food banks nationwide, making us one of the major food donors in the country. If the food cannot be donated because it has reached its expiration date or it is no longer suitable for human consumption, our allies process it for livestock consumption. In extreme cases, when the food cannot be used even for livestock, we explore options like composting or biodiesel production. Our strategy is to find alternatives to prevent food from ending up in landfills. We need to collaborate with NGOs, suppliers and authorities to achieve this goal.

Q: What plans does Walmart have in place to capitalize on opportunities arising from the Mexico Business Summit?

A: Our regeneration strategy is based on four pillars: Opportunity, Community, Sustainability and Ethics and Integrity. By Opportunity, we refer to creating opportunities for both our associates and suppliers, leading to the development of the local economy in an environment of respect, diversity and inclusion. We also adapted our stores for people with disabilities and recently launched a pilot in a store in Mexico City that uses artificial intelligence to facilitate the shopping experience for customers with visual impairments. This initiative was made possible through collaboration with allies that develop technology.

Our Community approach follows two fundamental strategies. The first relates to food security and reducing food waste. We support the needs of Mexico’s network of food banks with infrastructure. We are also working on providing our customers access to affordable and reliable products and services. We have developed a new ecosystem that goes beyond offering low-cost products in our stores. We are also expanding and offering accessible financial services and a health membership for customers who do not have insurance, providing them with access to low-cost medical visits and discounts on medications.

The Sustainability pillar focuses on recycling and the circular economy, for which we need allies across the country. We will soon launch a nationwide call to seek collaborators that process organic waste. This initiative is essential to meet our goal of becoming a zero-waste company by 2025. We are confident that we will find valuable allies in this search.

Our participation in the Mexico Business Summit is part of our strategy to showcase our focus areas and create connections to form alliances and collaborate on new initiatives. We are excited about the opportunity to establish these connections in this forum, where we all share a common interest in driving positive change.

Walmart's ESG (environmental, social and governance) strategies are comprehensive initiatives designed to integrate sustainability and responsible corporate practices into the core of the retailer’s business operations. These strategies focus on creating long-term value for the company, its stakeholders and society.

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