Ethical Performance
inside intelligence for responsible business


Wal-Mart makes ground on its bold CSR pledges

September 2006

Wal-Mart appears to be making early progress on its promise to embrace corporate responsibility, despite scepticism from investors and pressure groups.

The huge and much-criticized US-based retailer has introduced a number of measures during the past few months, having announced last year that it had become a CSR convert (EP7, issue 7, p3).

Among the more significant is an agreement to establish officially recognized trade union representation at all its outlets in China. The retailer, which has been attacked for many years for discouraging unionization of its employees worldwide, has formed an alliance with the government-backed All China Federation of Trade Unions ‘to create a harmonious way of facilitating the establishment of grass-roots unions’. As a result, employees have already established a branch of the union in Quanzhou.

Among other initiatives in recent months, Wal-Mart has:

committed itself to buy seven million kilos of organic cotton from producers in Turkey and India

agreed to buy all its wild-caught fresh and frozen fish sold in North America from fisheries certified as sustainable by the Marine Stewardship Council, within five years

started to draft its first corporate responsibility report, due to be published next spring

begun work with Environmental Defense, a non-profit environmental group, to develop a new generation of fuel-efficient hybrid engines for its fleet of 7000 trucks.

Wal-Mart, which operates more than 6000 stores around the world, has also signed a $35million (£18.5m) deal with the National Fish and Wildlife Foundation to conserve wildlife habitat in the US. The funding, which will be paid out to the US charity over the next ten years, will finance the protection of one acre of land for every acre developed by Wal-Mart. The company has committed to preserve a minimum of 138,000 acres (56,000 hectares).

Additionally it has detailed, for the first time, how many women and minorities it employs. The document shows that of more than 1.3 million workers it employs in the US, women comprised slightly more than 60 per cent last year, while minorities made up 32 per cent. Women held nearly 39 per cent of jobs listed under the heading ‘officials and managers’, which includes administrators and managers. The company says it will now release information regularly on the gender and racial make-up of its workforce.

Wal-Mart’s recent efforts have so far done little to change the attitude of many NGOs and investors. In May the Norwegian government’s $240billion pension fund decided to withdraw its Wal-Mart investments over what it called ‘serious and systematic’ abuses of human rights and labour rights. The decision was made on the advice of its two-year-old Council on Ethics.

Some campaign groups still dismiss the company’s efforts as ‘greenwash’. Matthew McGregor, senior campaign officer with War on Want, said: ‘Voluntary measures aren’t good enough. What we really need is new laws to regulate the activities of big supermarkets more effectively.’

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