Walmart Stores Inc. has announced an ambitious plan. The company wants to eliminate 20 million metric tons of greenhouse gas (GHG) emissions from its global supply chain by the end of 2015.
Essentially, the company is asking suppliers to assess the lifecycle of their products.
And Walmart will not absorb any costs that will go into making products more energy-efficient. That will be up to each supplier.
What’s 20 million tons?
Twenty million metric tons represents one and a half times the company’s estimated global carbon footprint growth over the next five years.
It’s also the equivalent of taking more than 3.8 million cars off the road for a year.
Walmart says its global supply chain’s footprint is many times larger than its operational footprint and represents a more effective opportunity to reduce emissions.
The program to reduce GHG emissions has three main components.
Selection: Walmart will focus on the product categories with the highest embedded carbon, such as milk, bread and meat. This is defined as the amount of life cycle GHG emissions per unit multiplied by the amount the company sells.
Action: For a project to be included as part of this goal, it must reduce GHG emissions from a product in either the sourcing of raw materials, manufacturing, transportation, customer use or end-of-life disposal. Walmart must demonstrate it had direct influence on the reduction and show how that reduction would not have occurred without Walmart’s participation.
Assessment: Suppliers and Walmart will jointly account for the reductions. ClearCarbon, an external adviser, will perform a quality assurance review of those claims to ensure methodology, completeness and calculations are correct. When the claims meet the quality assurance check, PricewaterhouseCoopers will assess under consulting standards whether the defined procedures were followed consistently to quantify the reduction claim.