How Can Walmart

How can Wal‐Mart China improve sustainability in its distribution and retail operations (consider “reduce, reuse and recycle” as well as innovation)?

On one hand, they have already improved sustainability in its distribution operations by buying directly to the farmers. Through this new way of distribution, they can control the standards of food and at the same time, Wal-Mart gets fresherfruits and vegetables. They also improve the farmer’s economy and cut costs. However, from our own view-point, this practice appears unfair because the market structure is supposed to follow this structure: supplier wholesaler retailer (in this case, Wal-Mart). What they are doing is adapting to a new structure: supplier retailer. While it has the aforementioned benefits, it creates an unfairmarket to other retailers that do buy from the wholesaler.

We also believe that by implementing the scorecard on the distribution and telling them what practices they could improve is a good way to improve sustainability of their suppliers. Loftex is an example of that, Wal-Mart already has programs to help advice how to reduce energy and water use and reduce emissions. As a result of that, Loftexhas cut electricity use by 25 percent and water use by 35 percent, not only that, their advice is extended to the manufacturing of the products which has resulted in a reduced environment impact from Loftex towels. We already agree this is an excellent practice but we think it can be extended furthermore. Wal-Mart can encourage its suppliers to adapt the scorecard to their own suppliers to makethe chain value get even bigger.

On other hand, sustainability in their retail store operations could be improved by increasing renewable sources on its electricity check. They may increase the number of solar panels on their stores or having motion sensor lights. Customer electronics are the fastest growing waste stream on the planet. Wal-Mart china could adapt what Best Buy is doing, collectelectronics and put them on a recycling program. The program takes from the computers and electronic devices: alumina, metals and other high valued elements and sells them as raw material to other industries. It has been proven that while net profits are not as high as preferred, it at least break even while the brand image improves significantly.

How should Wal‐Mart China relate to thegovernment and employees in advancing sustainability?

China has been growing rapidly in the past decades. This development has come at the expenses of the country’s environment. China is now a distressing scene brought by polluted sky, water and soil. As a result of that, China is currently the biggest greenhouse gases emitter. The aforementioned outlook in which Chinese are high sensitive costumershas brought an unnecessary approach for companies to environmental issues.

Nevertheless, that impact has prompted a growing environmental concern from company’s external stakeholders. International agreements have built a filter for global trading of Chinese products forcing those Chinese companies to turn their look into environment issues. However, even though those businesses want tocomply with that global sustainability movement, in some cases China’s poor infrastructure has hindered them to meet the standards. As a result of that, companies must work with the government to break down environmental filters and advance in sustainability.

Government should be able to respond as well. We would like to point out a conversation one of us had last time with an Environmental Policyexpert who worked for the U.S. Environmental Protection Agency (EPA) in the Clean Water Department. Mr. Maraldo explained how China was growing so fast that they did not realize the negative impact on their environment they were causing. However, he was taken to Shanghai, China to explain to Chinese government officials how the Clean Water Act works in order for them to develop a similar model...