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Unformatted text preview: ers, the quantity was estimated to be more
than 10 times greater.16
For these reasons, Walmart’s reputation among consumers and environmentalists was
deteriorating. According to a study conducted by McKinsey and leaked to the public by the
public watchdog organization Walmart Watch, between 2 and 8 percent of consumers said they
had stopped shopping at Walmart because of the company's practices.17 Another study,
performed by Communications Consulting Worldwide (CCW), claimed that if Walmart had a
reputation similar to that of its rival Target, its stock would be worth 8.4 percent more, adding
$16 billion to the company’s market capitalization.18 Compounding Walmart’s problems, sales
growth was slowing and the company was facing increasing resistance from local communities
as it sought to expand geographically.
THE SUSTAINABILITY STRATEGY
Against this backdrop, Scott initiated a review of Walmart’s legal and public relations challenges
in 2004. One area that the company wanted to evaluate was its environmental impact. “They
were looking for help defensively from a strategic standpoint‘Where are we vulnerable?’”
explained Jib Ellison, founder of Blu Skye Sustainability Consulting.c However, Ellison had
bigger ideas for how Walmart could profitably reduce environmental impacts, which he pitched
to Scott in June 2004. The basic proposal was that Walmart could obtain a “license to grow,”
differentiate itself from its competition, and cut costs through an environmental strategy.
“Sustainability represents the biggest business opportunity of the 21st century,” said Ellison.
Intrigued by the idea, Scott hired Blu Skye to perform an environmental impact assessment and
to help Walmart launch such an initiative. a Information provided by Walmart.
According to Environmental Defense, an average household with two mid-sized vehicles emits more than 20,000
pounds of CO2 a year, which equates to 10 tons of pollution; see “Tallying Greenhouse Gasses from Cars,” June
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- Winter '10