Looking at Walmart’s business model, I see a striking resemblance to
Milton Friedman’s views on Corporate Social Responsibility . “Using its resources
effectively to maximise profits and in the context of the environment do it
lawfully without fraud or deception”. Walmart’s social responsibility
towards the environment has impressive results as detailed in Marc’s post. In
2005 Walmart voluntarily acted to reduce
their carbon footprint by investing in a sustainability program. Marc’s
first chart looks impressive. But is it
good enough? Let’s consider this using a question that Friedman might ask.
Do they know how to do more and would it be the right way? Walmart are
specialists at what they already do. Are they experts when it comes to the
environment? They are not, it is not their mandated sphere of concern, what Walmart are showing is professional
responsibility. As Walmart is not a person but an
artificial agent it just concentrates primarily on its own concerns. They could view their contribution thus
far towards the environment, employment, lower cost of living for everybody and
revenue through taxes collected by the Government from its activities is enough
(The Open Polytechnic, 2011).
Despite all of its efforts,
Walmart’s making the climate crisis worse. Marc’s charts are compelling. From 2005-2010,
the first chart shows Walmart’s efficiency. Emissions dropped a net 10 million tonnes
of CO2e per million dollars in sales. The second chart shows a rise
of net three million tonnes per million dollars of sales of CO2e.
Combined, this is a net loss of 7
million tonnes of CO2e.
I’d like to introduce a third chart. Using Marc’s data of CO2e
emissions and combining the two charts, it shows Walmart are not making it
worst but in total, emissions have dropped and plateaued.
Combined Emissions Chart |
- Is largely driven by the fact that people are
consuming more. In today’s world, that means generating more climate pollution.
Or should that read? There are now more
people consuming. We must consider the fact the world’s
population according to the United Nations (U.N) is growing at 1.14% per year
(equivalent to around 75 million people) (wikipedia.org). These
people will require food, clothes and shelter. As other nations continue to
develop, Abraham Maslow’s ‘Hierarchy
of Needs’ will see people wishing to meet their lower needs first before
higher needs is plausible.
That’s
because Walmart can’t stop people from buying stuff, including lots of stuff
they probably don’t need. This statement appears quite narrow. Consumers
each are different in their desires when shopping. Autonomous and/or rational
in their decision making, driven by trends, cultures, word of mouth,
advertising by suppliers and consumer reviews. Who is it for us to say what
people probably don’t need? It’s an individual choice. Companies like Walmart
would not stock items that people don’t need; it would be hard to make money
that way. Walmart stock items in high volume that people buy and continue to
buy. People buy either for a need, a feeling, a sensation or enjoyment
(Arrington, 2004 p.413).
.
Does Walmart have to
do more? It
could, but it would come at a cost and who will bear that burden? R.E
Freeman’s, A Stakeholder Theory from a wide-definition, includes
any group that can benefit or be harmed. Walmart’s stakeholders would include
but not limited to; management, customers, suppliers, employees, the community,
government and we’ll include the environment itself. Each group has a stake in
Walmart. Management’s job is to decide how to balance the needs of each group
and find the balance for overall happiness. That’s a challenge. Will suppliers reduce their prices even more to help
pay? Unlikely, suppliers are most likely to be screwed down already. Will
employees reduce their hours or take redundancies? This would not lead to much
happiness. What about pushing up prices on goods for consumers? (Freeman
p.59).If you didn’t know already, Walmart’s' mission statement
is –“people, saving money, and a better life”. Walmart’s success is based on its business
model, and putting up prices would go against it. If Walmart was successful to
do the above, it would in effect be imposing taxes on
to the stakeholders and then deciding how theses taxes should be spent on their
behalf. In principle should a company have the right to do this? (Friedman
p.250).It also risks
consumers going elsewhere for their goods, possibly a competitor who may not
even have a sustainability program or another consequence, assist in driving up
inflation.
What about the government as a
stakeholder? It is interesting to note
the “U.S has not ratified the Kyoto
Protocol ;
sighting potential damage to the U.S economy required by compliance and
questions its scientific justification, but would look
at market-based incentives and voluntary measures for corporations” (eoearth.org).If the government is having
conflict within itself as to the best action to take, then Walmart should be commended on its actions to reduce CO2e
and still return profits for its stockholders.
Suggestions -The first and most obvious is to speak out
more strongly about the need for governments to put a price on carbon
emissions.
As individuals
should it not be us that speaks out more strongly and have the government
listen? Is it not the governments’ social responsibility to look after our
needs of now and in the future? “The government is mandated to develop
knowledge and expertise” (The Open Polytechnic, 2011). The government can create laws for
company’s to abide. The collective approach to towards the environment has more
chance of making a difference than singling out one company.
Second, Walmart could do more to try to change
consumer behaviour. Even though it may be right, is
this not manipulation and control of consumer behaviour? (Arrington p.412). I
have already suggested that Walmart are not experts, but they could provide
information for consumers. Kant says
“that people have intrinsic worth and as free agents they are capable of making
their own decisions. Humans can use their conscientious actions that have moral
worth by making the right choice”, in this context of whether to buy or support
a product that is carbon neutral or not (Rachels p.137).