Wal-Mart CEO Calls for Reduced Consumption?
by Alex Pasternack, Beijing, China on 10.23.08
The Big Question
Near the end of Wal-Mart's 2008 Sustainability Summit in Beijing, CEO Lee Scott addressed one of the greatest existential questions for the world's biggest retailer as it pursues its sustainability goals: Can true sustainability be reached without lowering -- lowering -- consumption, especially with the increasing growth of China's middle class?
Scott paused for a moment, and then:
Do we change how we purchase, how we consume, how we live? The answer to that I think is that to get to true sustainability, that does occur.Was the CEO of Wal-Mart suggesting that consumers alter their buying habits? Does he want people to come into Wal-Marts less frequently to pick up their sneakers and stereos and ice cream, their humidifiers? Just like, for instance, they're doing right now in the US, to the company's chagrin?
Not exactly. He continued:
As people more and more embrace sustainability, they're going to be less likely to look for a 4 dollar toaster for one year, they'll think how long will that product last over their lifetime. By making better products, people will be able to pay a fair value for 10, 15 years. People who buy a better TV will live better because less money going out of their pockets."
Basically, Wal-Mart wants to improve the quality of products so that people replace their old TV, for instance, every 10 years instead of every 5. By improving quality -- and their sustainability cred -- Wal-Mart figures, they'll get more customers.
And there are a lot more customers out there all the time. This year the company opened 30 stores in China, only three of which were in big cities. The others were in places few people outside China have heard of. Sales across China are up around 30 percent in the second quarter, compared to 16 percent internationally. In other words, more sustainability, but also more sales. More sales, more stuff. More more more.
On a individual level of sustainability, Wal-Mart could have a deep impact. It's already working to reduce waste in packaging and shopping bags.
But on the macro level, is Wal-Mart ironically -- cynically? -- using sustainability to sell more stuff to more customers? Surely, I don't want to be in the business of telling Mr. Wang or any other Chinese consumer not to buy another (energy-efficient) television. But Wal-Mart is in the business of telling people like Mr. Wang to buy another television, and perhaps a new (power-saving) DVD player, even as it pledges to make what they consume more sustainable.
It's a curious tension. As Sami pointed out last year, "If they use half as much energy to produce a T-shirt, but sell four times as many, the environment will still suffer."
While he pushes sustainability, Lee Scott is in fact hoping for a change in consumption patterns too. He wants more people to buy more things.
Wal-Mart is not greenwashing. I think Scott is convinced about environmentalism and is serious about improving business-as-usual. And yet some might argue what they're doing may be worse than greenwashing.
Either way, at the end of the day, as the straight-talking CEO himself said, they're "not green."
Photo: 99 Cent by Andreas Gursky
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I think this post has the wrong idea, or at least needs to straighten out its priorities. It is one thing to tell those of us in wealthy countries we should consume less in the name of sustainability, but quite another to deny the benefits of modernity to those just entering or trying to enter the global middle class.
What, after all, would be the point of sustainability if we cannot allow the other people on this planet to be as wealthy as we are? Why should we privilage our future generations at the expense of the poor alive today? Both challenges- poverty and sustainability- must be confronted at the same time, and since capitalism is one of the most potent weapons we have against the first (when used properly), we need it to serve the second as well. We need to WANT total global consumption of goods and services to increase even as consumption in rich countries decreases, since that means alleviating poverty. To make it sustainable we need to make the impact of our consumption, the amount of scarce or non-renewable resourcesused and waste generated, vastly less than it is today.
This is the reading of Scott's words that make environmental AND business sense.
I'm not so sure Lee Scott wants more people to buy more things. I think people buying more things would be totally ok with him (in the short term, anyway), but I don't think Wal-Mart marketing is about trying to convince people that they need more stuff.
Wal-Mart wants people to buy the stuff they need and want from Wal-Mart. Lee Scott wants people to stop shopping at regular supermarkets and neighborhood grocery stores and shop instead at Wal-Mart. Wal-Mart marketing reminds us they're cheaper and more convenient. I take that to meant that they are focused not on increasing demand but rather on taking market share from other businesses.
At least that's how things look to me.
And, looking at things that way and also from a responsible consumption angle, I think one big question is whether Wal-Mart's sustainability initiatives make them a more sustainable business to support than their competitors (supermarkets, Target, small grocery stores), a better place from which to buy the things we need.