Manuel Gómez
Vice President of Sustainability
Walmart Mexico and Central America
View from the Top

Flourishing Supply Chain Leads to Growth

Wed, 02/24/2016 - 11:16

Q: How have the attitudes towards sustainability and CSR changed, and in turn how have you adapted your priorities in the past year?

A: The attitudes towards sustainability and CSR have been reinforced, as more companies develop and integrate sustainability strategies as part of their core business. We can see a growing number of companies actively engaged in renewable energy, waste reduction, and water management. In the case of Walmart Mexico and Central America, we have developed a sustainability business plan with clear targets, which entail 100% renewable energy consumption, reduction of energy intensity, waste reduction, and collaboration with suppliers. We diverted 74% of waste from landfill and reduced food waste by 6% compared to last year. We developed a waste reduction campaign to reduce food disposal and increase revenues from recyclables. We launched an online program in Eco-Efficiency for small- and medium-sized enterprises. The objective is to develop eco-efficiency projects that decrease operational costs by means of optimized use of energy, water, and raw materials. The program was developed and operated by the Global Institute for Sustainability (GIS), and is sponsored by ITESM.

Q: What are the implemented strategies that enabled Walmart Mexico and Central America to recycle 55,000 tonnes in the first quarter of 2015?

A: The strategy incorporates three elements: engage employees, track and measure waste, and review processes. The campaign is called “Reduce, Recycle and Win”, which combines best practices to reduce organic waste and increase the recovery of recyclable materials. At the end, there is a competition that rewards the stores with the best results in the reduction of organic waste and the increase of recyclables. Each store has an indicator regarding the amount of recyclable materials generated in relation to sales. We then conduct periodic store visits to ensure that the procedures for recovering, compacting, and sending recyclables are properly implemented.

Q: How do you collaborate with research centers, such as GIS, in order to help SMEs become part of your chain and become more sustainable?

A: The collaboration with our suppliers and other organizations is fundamental to making greater progress toward a more sustainable supply chain. Initiatives developed by our suppliers allow us to offer over 1,500 products that have managed to reduce the impact in their life cycles. A pilot test was performed on the Product Sustainability Index, which is a tool that identifies significant environmental impacts of products in their life cycle and the actions to reduce such impact. The testing stage included four categories: coffee, detergents, dairy products, and domestic use paper. The companies that participated had to answer a questionnaire relating to the impact of their products, achievements, and areas of opportunity. This initiative allows Walmart to increase its assortment of lowimpact products and improve current versions. Our Tier 1 suppliers must disclose their carbon emissions to the CDP Supply Chain Program. We work with GIS in implementing the eco-efficient SME training program and in 2014, 65 of our suppliers started the first module of the program, which will be completed by the end of 2015.

Q: Water management is an important and rising concern for transnationals. What strategies have you created in order to improve your water management strategies?

A: Our water management strategy has two elements: reducing consumption at stores and distribution centers by installing equipment and developing initiatives to preserve water. We set internal water reduction goals, for example, last year our goal was to reduce water consumption by 7% and we achieved 8%. The second element of the strategy is to treat wastewater onsite and recycle as much as possible. Last year we recycled 34% of our used water. Walmart is ahead of the pack in water management strategies, since it aims to have 665 wastewater treatment plants, which will make it the biggest water treatment network in the private sector to date. We are strongly committed to continuing to pioneer in sustainable supply chain development. Walmart is uniquely positioned, given its scale and reach, to drive significant change and make sustainability affordable. We plan to double the size of our business over the next ten years. The combination of energy efficiency and leadership on renewable energy will allow us to grow and at the same time reduce our carbon emissions.