As a result, suppliers like Lutex have had to add more efficient light bulbs, switch from Styrofoam to paper packaging, and add better ventilation to its factories. Wal-Mart has about 10,000 suppliers in China. If Wal-Mart was a country, it would be China's fifth- or sixth-largest export market. Basically, Wal-Mart is continuing it's dominance over its suppliers in becoming more green and environmentally friendly. Wal-Mart's 200 biggest suppliers in China have already cut down their energy use by about 5 percent because:
"pollution now threatens China's growth; as a result, awareness of climate change and energy security has spread in China. Likewise, as consumers grow more environmentally aware, Wal-Mart's executives have responded. On Thursday, the company pledged to cut 20 million metric tons of greenhouse gas emissions by 2015".
It is hard to view the controversial Wal-Mart we all know as a pusher for the environment. Based on what we have discussed in class about monopolies and also the video we viewed about Wal-Marts business practices in regards to Rubbermaid. Will Wal-Mart continue this shift in the business world from supplier to seller in terms of becoming friendly on the environment? As Wal-Mart chief executive Lee Scott states, "Meeting social and environmental standards is not optional. I firmly believe that a company that cheats on overtime and on the age of its labor, that dumps its scraps and its chemicals in our rivers, that does not pay its taxes or honor its contracts will ultimately cheat on the quality of its products. And cheating on the quality of products is the same as cheating on customers. We will not tolerate that at Wal-Mart".
It leads to the question about how business practices will continue in the future, and whether they will bear the responsibility of promoting good environmental practices and consumer habits as opposed to where governments have in the past. Wal-Mart seems to be serious about these changes and is seems to be using its power to lower its business costs and delivering the savings to the consumer, which may explain the reasoning for why it has continued to make profit in the recession. Therefore it leaves to question whether these practices are being used in order to lower costs, or to help the environment, or both?
This question is argued about by critics of Wal-Mart like , "China Labor Watch, a New York-based organization devoted to workers' rights in China, (who) said in a report last Thanksgiving that the case of Wal-Mart . . . shows that corporate codes of conduct and factory auditing alone are not enough to strengthen workers' rights if corporations are unwilling to pay the production costs associated with such codes". Critics such as this cause people to wonder about Wal-Mart's true intentions, as asked about on the worksheet from last class. This question also gets murkier when it comes to Wal-Mart's food policy because "Wal-Mart is trying to cultivate healthier farm techniques, with less pesticide, more organic fertilizer and more-efficient water use" through "buying directly from farmers and independent distributors, cutting out middlemen to save money for itself and boost the incomes of farmers" and also has established its own labels in China "to identify fruits from farms that meet its standards, although the standards are not up to U.S. organic levels".
Again, Wal-Mart is seen as trying to improve it's image, or is it just another way to cut it's cost to lower prices for the consumer. They also claim to raise the average Chinese farmer's income as well as buying local, which we previously discussed about in regards to Detroit and urban farming. Therefore, because Wal-Mart has the power to influence it's suppliers like this, does it, and other multi-national companies have a responsibility to the people as government's do, or are they simply out to make a quick buck by cutting costs or clever marketing to the trends of people?
Again, this brings up the long debated question discussed in class, does Wal-Mart benefit or hurt the consumer? How will these new regulations by Wal-Mart change the industry of the supplier side of businesses? If Wal-Mart continues to influence the economies of the USA and China, will international anti-monopoly laws need to be created, or will this benefit the economies of the USA and China together?
It seems like Wal-Mart is working really hard to be environmentally friendly and forcing their suppliers to do the same. It tells consumers that they care about the Earth and makes other companies that are not going green look bad. If this is what it will take to make other companies be more environmentally friendly, than so be it. Either way, we will all be a lot better off. T
ReplyDeleteOne of the things that really struck me in this article was the statement that Wal-Mart's standards are more effeective and progressive than the government's. The Chinese government has a lot of control, and it just really shows the world power of Wal-Mart. Also, the fact taht if it were a sovereign nation, Wal-Mart would be China's 5th largest export nation. China's! A SOVEREIGN NATION! Wal-Mart is HUGE! For all of its influence, I believe that Wal-Mart is doing a very good thing in stepping out and becoming a worl leader in economically friendly big businesses. This WILL help to improve their controversial image and in turn gain more customers. As they say, "they aren't doing it from teh kindness in their hearts"; they want more money. It is a smart move in all directions to enforce economically friendly practices.
ReplyDeleteA,T