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Walmart: Chemical Footprint Reporting Is Key to Creating Sustainable Stuff

Companies are increasingly focusing on measuring and reporting their chemical footprint via several tactics including creating a management strategy and conducting a chemical inventory, according to a new report from the Chemical Footprint Project (CFP). Participating companies represent annual revenues totaling over $670 billion, across all sectors, sizes and locations, and shared how they measure their footprint and how they were able to reduce their hazardous chemical use. The data is critical, says Walmart’s senior director for sustainability, Zach Freeze. It helps the company understand where it and its suppliers are on the road to more sustainable chemicals. This also helps companies identify and prioritize opportunities for improvement. Walmart was the first retailer to participate in the annual survey.

Other companies include Adidas AG, Alima Pure, Angelica Corporation, Beautycounter, Becton Dickinson and Co, Case Medical, Construction Specialties, GOJO Industries, Herman Miller, HP, Inpro Corporation, Johnson & Johnson, Kimball Hospitality, Levi Strauss, nora systems, Radio Flyer, Replenish, Seagate Technology PLC, Sealed Air Corporation, Seventh Generation, and WaterWipes.

Why Bother? 3 Big Risks

For companies involved in tracking their environmental initiatives and progress via the Sustainable Development Goals, understanding their chemical footprint is critical. Knowing how to benchmark corporate progress in terms of chemicals is a large part of creating more safe and sustainable products, but it also mitigates significant risks.

  • Regulatory: liabilities can occur when companies fail to comply with current regulations. From 2011 to 2013, six retailers in the US paid almost $200 million in fines for failure to comply with hazardous waste regulations. And, if companies fail to address potentially harmful chemical substances, they are at risk of having to spend significant amounts of money due to new chemical substance regulations – regulations which are increasing faster than for any other environmental issue, including climate change, CFP says.
  • Reputation: when a company is exposed publicly with hazardous chemicals in products or supply chains, they face risk of lower sales, reduced market valuation, decreased customer loyalty, and lawsuits. For example, Lumber Liquidators’ stock plummeted by 70% after NGOs revealed elevated levels of formaldehyde in its products.
  • Redesign: companies also face potential costs related to the continued use of hazardous chemicals in products and manufacturing processes and not redesigning products before regulations change or markets shift. Sony incurred over $150 million in redesign and recall costs when it failed to remove cadmium from its Playstation products.

Trends

The report found:

  • For companies selling liquid-type goods such as household cleaning and personal care products, large companies scored higher for metrics that require policies, systems, and procedures for safer chemicals, while small companies scored higher for footprinting and transparency to the public.
  • For companies selling hard products such as clothing, furniture, and electronics, large companies scored higher across all indices, followed by medium companies, and then small companies. The CFP attributed the higher scores for large companies to greater awareness of chemicals in their products and supply chains, greater resources to manage chemicals, and greater need to have corporate policies in place to develop and implement chemicals management systems.

Steps to Chemical Management

Perhaps of more interest to companies struggling to measure their chemical footprint, participating companies revealed clear steps to environmentally sound chemicals management:

  • Corporate Policy: establish a comprehensive chemicals policy.
  • Inventory: know the chemicals in your company’s products and supply chains.
  • Measurement: quantitatively measure your company’s chemical footprint, set measurable goals, and monitor progress to these goals.
  • Transparency: engage the public, institutional purchasers, and investors in your firm’s journey to effective chemicals management by sharing publicly your CFP answers and score.

 

 

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