Corporation hires former Sierra Club president to polish its image
By Amanda Witherell
First published by the San Francisco Bay Guardian, August 16, 2006
Wal-Mart is bad, right? With more than $312.4 billion in annual sales, it’s the largest retailer in the world, selling its array of products at cheap prices by undercutting competitors, employing sweatshops, wielding its market power to cripple both competitors and suppliers, and flouting national and international health, safety, labor, and environmental standards.
Five of the 10 richest people in the country are from the founding Walton family. But to help the company offer its proclaimed “Every Day Low Prices,” workers are paid an average of $17,530 a year, nearly $2,000 below the poverty level of a family of four. Almost half of the children of those associates are uninsured or on Medicaid. In California alone, that annually costs taxpayers $86 million, according to the New York Times.
So why is San Francisco’s environmentalist wunderkind Adam Werbach — former president of the Sierra Club, board member of the Apollo Clean Energy Alliance, and founder of the activist film company Act Now Productions and the progressive DVD club Ironweed, someone who’s spent the last 17 years working for environmental and social change — now taking a paycheck from Wal-Mart, a corporation that he vilified in a chapter on radical localism in his 1997 book, Act Now, Apologize Later?
Sounds like a turncoat move. “It’s sad. It’s really sad,” said Robert Greenwald, director of Wal-Mart: The High Cost of Low Price, a documentary critical of the corporation’s business practices. When asked if someone like Werbach could really change the way Wal-Mart does business, Greenwald told the Guardian, “No. They’ve bought a bunch of people instead of taking care of their employees. And they bought environmental people because they knew that was the weak link.”
Is the largest corporation in the world trying to clean up a crumbling image with a cadre of well-known environmentalists? Or is it actually taking the nascent and necessary steps to learn a language these progressive thinkers have been speaking for decades? Does a company with the size, scope, and appetite of Wal-Mart even have the ability to pronounce a word like “sustainable”? If Wal-Mart embraces green technologies, starts carrying organic food, and turns conservation into a good old-fashioned American value, will it beat one of its fiercest competitors, the environmental movement, at its own game?
Wal-Mart CEO H. Lee Scott these days sounds like he just got smacked in the face with a copy of 50 Simple Things You Can Do to Save the Earth. His awe over some really tired statistics is almost endearing. Last November, in a speech broadcast to all Wal-Mart facilities he said, “Did you know that a large percent of the 5 billion pounds of pesticides used every year are used on cotton? Those toxins don’t stop at the field but can leach into the waterways and may eventually find their way into animals, food, and children.”
Uh, yeah, ever heard of Silent Spring? Environmentalists have long decried the insidious nature of toxic chemicals. So what’s he going to do about it? Get a rally going? Start a boycott? No, Scott has become the largest purchaser of organic cotton in the world.
It isn’t just cotton. In characteristic Wal-Mart balls-to-the-wall fashion, the retailer has also become the biggest vendor of organic milk, in a market where demand is already 20 percent higher than supply. Grocery divisions are starting to stock sustainably harvested fish and Newman’s Own Organics. The rest of its strategic sustainability plan sounds more progressive than what even a supposedly green city like San Francisco has come up with. Wal-Mart execs have pledged to improve the fuel efficiency of their trucking fleet, the second largest in the country, by 25 percent in three years and double it within 10 years. They plan to reduce energy consumption in stores by 30 percent and are looking at how to replace the remaining 70 percent with renewables. They’ve already constructed two “green” prototype stores in Aurora, Colo., and McKinney , Texas , and plan to invest $500 million annually in technology that can reduce greenhouse gases at existing stores by 20 percent in seven years. They want to go zero waste.
“We intend to reach the point in the near future where there will be no Dumpsters at our stores and no landfills with Wal-Mart throwaways,” Scott said.
That’s huge, a bold flanking maneuver by a known enemy. How can a corporation — that makes its money from consumers throwing out and replacing the items they purchase — “go zero waste” and really mean it? Rebecca Calahan Klein, president of Organic Exchange, the Oakland-based nonprofit trade association that connects Wal-Mart and other retailers such as Patagonia, Organic Essentials, and Nike with cotton farmers all over the world, said her board uses three criteria to determine if a company is serious about going organic: Does it recognize the need for a completely transparent process from field to store? Is it really committed to the concept, rather than jumping on a passing fad? Does it recognize its own power and is it willing to work in new ways and alter its business model?
Klein said that although she’s been skeptical and her board members even more so, Wal-Mart has passed those tests. “I’ve worked with businesses for 20 years. You can tell when someone is not being sincere. They don’t put it in their business strategy. They don’t put their best people on it.”
Who are Wal-Mart’s best people? The roll call includes Werbach and representatives from the Rocky Mountain Institute, World Wildlife Federation, Natural Resources Defense Council, Environmental Defense, and Conservation International. The experts are part of 14 networks functioning like think tanks to work on a range of specific issues that affect nearly every aspect of Wal-Mart’s business — alternative fuels, packaging, chemicals, food and agriculture, textiles, electronics, facilities, internal operations, logistics, forest products, jewelry, seafood, and climate change. They convene regularly to brainstorm ideas, and by many accounts, including those of Klein and Werbach, it seems as though the CEOs and upper-level associates are finally getting what this choir has been preaching for a long time.
Some choir members have their eyebrows raised and their mouths gaping over this one. Among the people we contacted, including film director Robert Greenwald, former Greenpeace executive director Barbara Dudley, organic and local food advocate Michael Pollan, and Sup. Chris Daly, who appointed Werbach to the San Francisco Public Utilities Commission, the main sentiment seemed to be surprise about the new partnership, with a sigh and — when it came to Wal-Mart’s pledge to help create a sustainable future — a “We’ll see.”
No one seems more surprised than Werbach himself. “I have been anticorporate my whole activist life,” he told the Guardian, sitting in a café in a quaint part of the Bernal Heights neighborhood. “I opposed the Sierra Club giving Honda an award for a hybrid car.”
But Werbach went on to explain how respectfully his ideas have been received, and unlike in the municipal planning morass where good concepts often go to die, Wal-Mart gets things done. “I’ll notice something in a store, and every store in America is changed by the end of the week,” he said, buzzed by the sheer wonder and magnitude of it all. “I’ve yet to find a big idea that they haven’t done,” he said of all the standard improvements environmental organizations have been rapping about for years, such as powering with solar panels, harvesting rainwater for irrigation, and heating with biofuel.
It seems inconceivable that someone like Werbach could be inspired by the likes of Wal-Mart. As a teen, he founded the Sierra Student Coalition, the largest student-run organization in the country, and was mentored by David Brower to become the youngest president ever of the Sierra Club at the age of 23. From 1996 to 1998 he rejuvenated the aging organization, and members still consider him an inspiring, innovative force.
“If our end goal is to change the way Americans think, we need to fund strategic initiatives that move the public’s values,” Werbach said at the Commonwealth Club in 2004. That notable speech, “The Death of Environmentalism,” argued for a new rhetoric and a fresh way of thinking to fight the problems typically considered partisan and environmental, but which affect all citizens no matter what their politics.
Werbach’s work with Wal-Mart puts that ideology into practice. He’s consulting for the corporation’s Environment, Health, and Wellness Program, advising associates on how to improve their lives. He could just tell them to eat organic food and buy compact fluorescent lightbulbs, both of which Wal-Mart now conveniently stocks. The company wins both ways. If it invests in teaching associates better living practices, it won’t have to offer premium health insurance. If it turns down the lights and reconfigures its trucks, it won’t spend so much money on electricity and diesel.
“Yes, Wal-Mart is interested in saving money by reducing energy costs, but who isn’t? That’s Basic Business 101,” said Cameron Burns, spokesperson for the Rocky Mountain Institute, which is advising Wal-Mart on fuel efficiency and green building.
The RMI, founded by conservation guru Amory Lovins, works with companies and corporations, as well as the US military, to improve efficiency and reduce energy use. The institute agreed to work with Wal-Mart after Natural Capitalism, an environmental consulting firm started by Hunter Lovins, turned it down. Paul Sheldon, the senior consultant for Natural Capitalism, said the organization rejected Wal-Mart because it didn’t believe the corporation was serious. “Their whole business model is basically parasitic,” he said. “They bring in goods from outside the area, they pay minimum wages, and they basically destroy local communities everywhere they go.”
In order to become truly sustainable, Wal-Mart would have to change more than just the lightbulbs.
It is. Werbach’s been tasked with changing the way Americans think. “How do you make sustainability something people in America want and care about?” he said — that’s the basic question Wal-Mart is asking. The test pool the company has given him is a field of associates at eight stores, because the people who work there are a lot like the 92 percent of Americans (according to company calculations) who walk through the front doors steering shopping carts. Through workshops and retreats, Werbach is sitting down with associates and asking them what their goals are. Losing weight? Quitting smoking? Spending more time with their families? Those are real-world challenges that Werbach helps them see in a broader context and tackle with a tool set that considers the basic tenets of sustainability. One associate he’s worked with decided to quit eating fast food. That’s great for the arteries, but the action also made him realize he was eating less frozen food, which meant less resources spent for processing, packaging, shipping, and refrigeration. He also spent less time idling in the drive-thru lane, which meant less fuel burned, which saved him money. That’s more sophisticated thinking than even that of the average Trader Joe’s shopper with Amy’s Organic heat-and-serve enchiladas in the cart. “They’re showing me things. I’m not trying to convince them of something,” Werbach said of the associates who wield the tools he gives them in creative ways. He cites the problem of smoking. Yes, it’s a health issue, but associates are telling him it’s an environmental issue too. That’s not something you hear from the typical save-the-trees organization. Smoking is not their problem; saving redwoods is their problem.
If Wal-Mart wants to change the way Americans think about their problems and how to solve them, is the retailer prepared to do the same with its business model? Klein of Organic Exchange thinks so. When her consultations with Wal-Mart began, she told them, “You’re the 800-pound gorilla in the room. It doesn’t work that way in organic. You can’t muscle in and make demands.” Wal-Mart listened and scaled its efforts accordingly, with a five-year commitment to purchase organic cotton and a multiyear approach to growth that is bound to increase. Organic cotton is currently less than 1 percent of the entire market. Klein said to us, “If we can get 10 percent, we will shift every major food source in the world.” She rattled off a list of staples, including soybeans, wheat, legumes, and rice, that are grown in rotation with cotton. They would all have to be organic to preserve the purity of soil that standard requires. The ramifications could be huge, and Wal-Mart has the money and the clout to make it happen. Beyond the demand side of the economic spectrum, Wal-Mart works with more than 60,000 suppliers. “Ninety percent of the impact Wal-Mart can have is on the supply chain,” Scott has said to his executives. It has already experimented with reducing the packaging of one toy product, which resulted in using 230 fewer shipping containers and 356 fewer barrels of oil. Since Wal-Mart has entered the picture, Klein has received phone calls from the largest cotton farmers in the country to discuss a switch from conventional to organic. In addition, she’s noticed chemical companies ramping up their criticism. “One measure of success,” she said, “is how quickly the critics try to discredit what you’re doing,” she said.
Talk to Wal-Mart’s critics and you’ll find things haven’t been looking too good for the retailer. In December an Oakland jury ordered Wal-Mart to pay $172 million to workers deprived of their half-hour lunch breaks. The largest discrimination lawsuit ever has been filed against Wal-Mart in San Francisco federal court on behalf of 1.6 million women. Growth is trailing that of competitors Target and Costco, and market shares have slipped 30 percent since Scott took the helm in 2000.
Wal-Mart’s internal research has concluded 8 percent of consumers won’t come through its doors for ethical reasons. Web sites, including walmartwatch.com and sprawl-busters.com, patrol the company’s every move and provide advice and resources for kicking it out of your community. Wake Up Wal-Mart launched a 35-city bus tour this month, designed to rally the masses against its foe. Greenwald is distributing free copies of his damning documentary to any associate who requests one. The company has set up a “war room” with former political consultants from the PR group Edelman, hired to counter Greenwald, his film, and the growing wave of protest. Greenwald remains a staunch critic of the retailer and said to us, “We have to look at the overall impact on the country and the world. Workers and families and communities are part of the environment too.” He thinks the recent greening move smacks of greenwashing.
“They’re essentially reaching out to one sliver of an integrated problem. They can turn down the lights and improve their trucks, and those are changes that need to happen, but at the same time they’re beating up workers, abusing sweatshops, and bullying communities,” he said. He may be right. Maybe Wal-Mart is just setting up a “green room.” When contacted by the Guardian, the only person readily available to speak about sustainability was a representative from Edelman.
Barbara Dudley, who was executive director of Greenpeace while Werbach was running the Sierra Club, told us it’s important to remember there isn’t one cohesive environmental movement. Though she criticized Werbach’s latest career move in a recent Grist Magazine commentary, “The Death of Integrity,” written with the Ruckus Society’s John Sellers, she told the Guardian, “People have different approaches. Some think it’s possible to work with a company like Wal-Mart. It’s certainly a positive step. Will it ultimately lead to a sustainable planet? It’s hard to imagine.”
“Can anything built on a model of Wal-Mart be sustainable?” she asked. “My personal answer to that is no.”
In an American culture accustomed to waste, it’s common to slap the term “green” on anything that’s even remotely recycled and forget that “Green Forest Paper Towels” are still pieces of paper to use up and throw out. In Europe sustainability means more than just recycling and wearing organic cotton. The guiding principles of the European Federation of Green Parties include specific labor practices and community development, and while Wal-Mart may be looking through Werbach’s eyes at how to help associates live better lives, it has yet to take a solid stand on these far-reaching issues. But there have been murmurings.
Scott recently pledged to raise wages 6 percent in a third of Wal-Mart’s stores, but he’s offsetting much of that with pay caps for longtime employees. He also promised health care for as little as $23 a month, perhaps in response to the UC Berkeley Labor Research and Education report that revealed that Wal-Mart associates on public programs such as the Women, Infants, and Children federal nutrition program and Medicaid depended on over $1 billion in taxpayer-funded subsidies.
Last week, Wal-Mart announced it would allow labor unions in its Chinese stores, but critics contend this may just be a move to stay in the good graces of the host government. No such concessions have been made in the United States, where a $7-million-dollar private jet equipped with three suited union busters is on hand to fly to the nearest threat of organizing associates.
“If we want sustainable communities, we need to have thriving downtowns. We need people who are paid decent wages and affordable medical care,” said Eric Antebi, a spokesperson from Werbach’s old stomping grounds at the Sierra Club. Considering the corporation’s recent changes, he said, “Everything Wal-Mart has done doesn’t take into account the negative impacts they’ve had.”
Paving the way
In the Bay Area it’s easy to forget about the big-box retail that’s a part of 3,900 other communities in the country. Many San Franciscans get their staples at Rainbow Grocery or Cala Foods, stock up on fresh produce from farmers markets and fruit vendors, and grab what they forgot from the store on the corner. Shoppers who venture to the Oakland Wal-Mart find a recycling bin for used shopping bags by the door and toy Hummers at the store’s sidecar McDonald’s. Despite the hyped environmentalism of the Bay Area, the store is surprisingly void of organic products, and the ones it does carry require a sophisticated scrutiny of the USDA certification and product lineage: Silk Soymilk is owned by Dean Foods, Earth’s Best baby food is a Heinz product, Morningstar Farms and Kashi belong to Kellogg’s. The Organic Consumers Association has enacted a ban against Horizon, which sells about half the organic milk in the country, most of it to Wal-Mart.
“Making organic food inexpensive means buying it from anywhere it can be produced most cheaply — lengthening rather than shortening the food chain, and deepening its dependence on fossil fuels,” wrote Michael Pollan in a May 15 New York Times blog entry, “Wal-Mart Goes Organic.” The author of The Omnivore’s Dilemma argues that the next frontier for conscious eating is one’s own backyard. When asked if there is any way for Wal-Mart to carry organic produce without encouraging feedlots, monocultures, and weakened standards — and still meet the demands of 138 million weekly shoppers — Pollan told us, “I don’t know. They’re saying all the right things, but their past performance surely is reason to be skeptical and vigilant. I’m not sure their stores have the knowledge to source locally — there’s nothing in their DNA to make me think they can do anything but buy industrial organic produce from the least-cost supplier, which will be China. But I’d be delighted to be proven wrong.”
As Amanda Griscom Little reported in Grist Magazine, “Ron McCormick, an executive in Wal-Mart’s produce division, said he plans to purchase a broader variety of produce based on what’s available in each region, rather than insisting on a ‘monoculture’ of produce at stores nationwide. ‘Our whole focus is: How can we reduce food-miles?’”
Wal-Mart seems to have gotten hip to the idea that while asparagus may be cheaper to grow in Argentina, it sure costs a lot to ship it to Maine. It’s started purchasing local produce in 24 states. According to Werbach, peaches now come from 14 suppliers instead of three. “Why? Less transportation costs. It diversifies the risk if one of the suppliers goes out of business. And the food’s fresher,” he told us.
Localism seems like the antithesis of Wal-Mart, but if it really is diversifying its suppliers, encouraging new markets to produce goods where it wants them, and talking to its employees about their own local problems, this could mean a real paradigm shift. “They’re still looking for new ideas,” Werbach said. “How do you make a TV without a box? That you can ship?” Could Wal-Mart eventually reverse the flow of cheap imports it’s spent years encouraging?
“Who better than Wal-Mart,” asked Scott in his 2005 speech to associates, “to make a kilowatt of electricity go twice as far or a gallon of diesel to take our trucks twice the distance? Or three times? Who better than Wal-Mart to stretch our energy and material dollars farther than anyone ever has?” Could these green initiatives and this new vernacular make it easier for Wal-Mart to open its doors in San Francisco?
Last week the Board of Supervisors approved a ballot measure sponsored by Sup. Gerardo Sandoval called the Small Business Protection Act. If passed by voters in November, large chain stores would have to be approved by the Planning Commission — giving critics a chance to mount an opposition campaign — before setting up shop in San Francisco ‘s neighborhood commercial districts. Similar conditional use requirements already exist in western SoMa, Cole Valley, and Divisadero from Haight to Turk. North Beach and the Hayes-Gough neighborhood have outright banned all formula retail. This November the voters will decide if there ever will be a Wal-Mart this side of the Bay Bridge. Consumers will have to remain just as vigilant and savvy about brands and labeling.
The $500 million pledged for greening the stores is still less than one-fifth of one percentage point of Wal-Mart’s total sales last year. Zero waste for the store doesn’t mean zero waste for the consumer. Wal-Mart would have to scale back radically to ever fit a local community like Bernal Heights, where Werbach lives, and he seems OK with that. His awe and enthusiasm for the company’s radical moves are still tempered with caution.
“We have to encourage them when they do good things and hold them accountable when they do bad things,” he said. But he’s still excited about the future. “We’re in new territory,” he said. “I’m learning so much. I’ve never learned so much.”
And the new ideas are coming home. “I’m a public utilities commissioner, and we’re in the process of revamping the sewer,” he said of San Francisco ‘s overtaxed pipes. He visited the Wal-Mart Experimental Supercenter in McKinney, Texas, where the parking lot has a permeable surface comprised of polymers that in addition to leaching out toxins also absorb water rather than send it running off. “It’s something I’d heard about, but I’d never actually seen it,” he said, bringing home the point that Wal-Mart has the money to invest in field-testing new technologies and then integrate ideas that work into its long-term planning. It could become a working model for other cities and corporations. “That’s how San Francisco should be thinking,” he said, before stepping out of the small café onto the cracked pavement to walk a couple blocks up the street to his home.
Ben Bruckman contributed to this report.
© 2006 S.F. Bay Guardian