Walmart; the high cost of low prices

As Wal-Mart CEO Mike Duke indicated in an October 2008 speech to suppliers in Beijing, Walmart’s goal is to operate “a supply chain where goods are made in a way that protects our planet; where customers feel good about the safety, quality and durability of the products they buy; and where workers are paid well and treated well with the respect and dignity they deserve. To achieve this, we are expecting more of ourselves at Wal-Mart, and expecting more of our suppliers.”

Corporate social responsibility

Andrea Thomas is Wal-Mart’s Senior Vice President of Sustainability. She is looking to improve Wal-Mart’s relationship with farmers, which she says would stabilize their produce prices and give more of the money paid for produce directly to the farmers. To accomplish this, they are prepared to sever ties with brokers and transportation and logistics companies that are currently acting as a “middle man”


Lee Scott said the world’s largest retailer wants to be a “good steward for the environment” and ultimately use only renewable energy sources and produce zero waste.

They pledged to have all stores running off of 100 percent renewable energy, create zero waste and to make more environmentally friendly products. in 2007 Wal-Mart released their “sustainability 360” storewide policies. While it appears as though Wal-Mart is turning a new leaf, there are still reports concerning their lack of eco-consciousness. Wal-Mart recently opened an experimental store in McKinney, Texas, to study environmental efforts such as heating the store with used cooking and motoroil.

Environmental goals center around reducing waste, environmentally friendly packaging, offering environmentally friendly products, running stores off of renewable energy and generally becoming more energy efficient. Currently, there are 20 US Wal-Mart stores in California and Hawaii that run predominantly off of solar power with another 20-30 planned for 2010 in Arizona and California. These thin-film solar panels are expected to provide 20-30 percent of the store’s power needs (roughly 22.5 kWh) and will be designed, installed, maintained and owned by SolarCity.

Wal-Mart has announced that they will eliminate 20 million metric tons of greenhouse gas emissions from its global supply chain by the end of 2015, a tall order for a store located in 70 different countries and suppliers around the world.These suppliers, must also comply with Wal-Mart’s sustainable policies and energy efficiency standards such as: Require factories around the world to certify compliance with laws and regulations where they operate as well as rigorous social and environmental standards by 2011.

Partner with suppliers to improve energy efficiency and use fewer natural resources by 2012. Higher standards of product safety and quality — Wal-Mart aims to drive returns on defective merchandise virtually out of existence by 2012. All direct import suppliers plus all suppliers of private label and non-branded products must provide the name and location of every factory used to make the products. The company will also have all suppliers it buys from directly to source 95 percent of their production from factories that receive the highest ratings on environmental and social practices by 2012

Ethical Behaviour

They developed a plan to bring the prices of generic prescription drugs down to $4, so that people could afford the healthcare that they needed. The $4 prescription plan was a huge success and Wal-Mart says that it has saved consumers more than $3.4 billion since 2006. Wal-Mart is now making moves on the produce sector to make healthy fruits and vegetables more affordable

Recent or current lawsuits against Walmart

Wal-Mart is currently facing a gender discrimination lawsuit, Dukes v. Wal-Mart Stores, Inc., which alleges that female employees were discriminated against in matters regarding pay and promotions. If the class action is certified, it would be the largest such lawsuit in history, covering 1.5 million women according to the plaintiffs.

The case started in 2000, when a 54-year-old Wal-Mart worker in California named Betty Dukes filed a sex discrimination claim against her employer. Dukes claims that, despite six years of hard work and excellent performance reviews, she was denied the training she needed to advance to a higher, salaried position. Wal-Mart’s position is that Dukes clashed with a female Wal-Mart supervisor and was disciplined for admittedly returning late from lunch breaks.