How sustainable business practices help the bottom line

Looking after the global commons can cut costs and foster growth

Walmart’s Project Gigaton is designed to encourage suppliers to pursue a suite of sustainability strategies, from procuring new renewable energy sources to avoiding deforestation.

Integrating sustainable practices into a company’s operations can improve business performance, spur technological innovation, inspire brand loyalty, and boost employee engagement.

That is our experience at Walmart, where investments in sustainability and efficiency in our own operations – and those made by our suppliers – have enabled us to save money, while striving to support jobs and help reduce impact on the environment.

Our mission is to save our customers money so they can live better. We strive to achieve this in part by focusing on our operational efficiencies, energy expenses, waste reduction and cost-effective procurement of renewable energy. We believe that our focus on sustainability is right for our customers, for our associates, and for our bottom line.

Walmart has now installed more than 1.5m LED (light emitting diode) fixtures across more than 6,000 of our stores, parking lots, distribution centres and corporate offices in 10 countries. This has reduced Walmart’s lighting energy consumption and reduced our lighting costs by hundreds of millions of dollars over the past decade.

Our work to reduce emissions and increase efficiency has also helped us to lower some of our other operational expenses. A few years ago, we announced that we had exceeded our goal of doubling the efficiency of our trucking fleet by 2015. This was made possible by our associates’ efforts to improve techniques for loading, routing and driving, as well as through collaboration with equipment and system manufacturers on new technologies. With these new efficiencies, we achieved savings of nearly $1bn and avoided emissions of almost 650,000 metric tonnes of carbon dioxide in 2015 compared to 2005.

By the end of 2015 we had upgraded 5,919 rooftop heating and cooling units – the highest number of such high-efficiency installations in the US – with estimated savings of 50m kilowatt hours and 35m pounds of carbon dioxide equivalent. The US department of energy says this is worth as much as $5m a year.

We are sharing our experiences and asking our suppliers to look at whether they may realise similar benefits in their businesses. We have launched an ambitious new initiative, Project Gigaton, designed to encourage suppliers to reduce emissions by one gigaton (one billion tonnes) – equivalent to taking more than 211m passenger vehicles off US roads for a year – by 2030.

The project encourages suppliers to pursue a suite of sustainability strategies, ranging from procuring new renewable energy sources to avoiding deforestation and reducing food waste. Unilever, for example, committed to plant 15m acres of climate-smart cover crops which help to reduce soil erosion, and increase soil fertility and water drainage. The move will also help to address climate change: the aim is to cut 10m tonnes of carbon dioxide emissions by 2030.

We have collaborated with NGOs, like World Wildlife Fund and Environmental Defense Fund, to create an emissions reduction toolkit to help suppliers make and pursue their Project Gigaton commitments. This provides resource materials for progammes and highlights the business case for suppliers considering signing on to the project.

Walmart understands that embracing and incorporating climate solutions can foster growth and cut costs at the same time. It is vital that businesses continue to innovate and contribute to advancing sustainability. We must remain active in telling sustainability success stories to suppliers, customers and investors. By demonstrating how sustainability investments can cut costs, we aim to strengthen businesses, our economy and, most importantly, the planet – and its global commons – on which we all depend.