January 26, 2009 / 7:46 PM / in 9 years

Wal-Mart's incoming CEO to expand environmental push

(Recast, adds byline, adds Mike Duke comments)

By Nicole Maestri

NEW YORK, Jan 26 (Reuters) - Wal-Mart Stores Inc’s new leadership (WMT.N) plans to expand efforts to reduce waste, use renewable energy and push suppliers to clean up their act, the company’s incoming chief executive officer said on Monday.

"We want to accelerate our efforts in sustainability. We want to broaden our efforts," said Mike Duke, who will become Wal-Mart’s CEO on Feb. 1 when Lee Scott retires from that position.

Speaking at a "Sustainability Milestone Meeting," which was broadcast over the Internet, Duke said Wal-Mart’s suppliers and employees need to make sustainability a priority.

"I am very serious about it. This is not optional," Duke said. "It’s not something of the past. This is all about the future."

Scott began the retailer’s environmental push in 2005, outlining plans to one day use only renewable energy and creating zero waste. The efforts have been seen as a way for Wal-Mart to improve its reputation, help the environment and cut costs.

To that end, Wal-Mart has increased its use of solar and wind power, pushed vendors to make electronics more energy-efficient and switched to selling only concentrated laundry detergent in its U.S. stores.

In October, Wal-Mart said it would start tightening controls on its Chinese suppliers by requiring them to meet tougher quality standards or face losing the retailer’s business.

Duke said he is committed to pressing suppliers to build products that comply with social and environmental laws, and meet higher safety and quality standards. He also said it is crucial for employees to take sustainability seriously.

"The leaders that get ahead in Wal-Mart will be ones that demonstrate their commitment to sustainability," he said. "You won’t be able, in the future, to really be viewed in the same way if you put this on the back burner."


In an effort to broaden its environmental efforts, Wal-Mart said it wants to eliminate the use of phosphates in detergents and it will require a 70 percent reduction of the compound by 2011 in laundry and dish detergents sold in its Americas region.

It also said it will cut packaging by 5 percent by the end of 2013 in that region.

Wal-Mart’s Americas region includes Canada, Puerto Rico, Mexico, Central America, Brazil and Argentina, where it operates more than 2,300 stores. The company’s Americas region excludes the United States.

It has already cut down on the size of packaging used in its U.S. stores and it said on Monday there were no phosphates in detergent sold in the United States.

Wal-Mart said phosphate compounds are a water pollutant that can damage aquatic ecosystems by stimulating the growth of algae, which depletes oxygen in the water for fish and plants. It said phosphates from detergents are a significant contributor to phosphate-based water pollution.

Craig Herkert, president and CEO of Wal-Mart’s Americas region, said the retailer is committed to working with its suppliers to one day eliminate the use of phosphates in detergents.

Wal-Mart shares were up 10 cents at $48.45 in afternoon trading on the New York Stock Exchange. (Reporting by Nicole Maestri; Editing by Andre Grenon, Dave Zimmerman)

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