The Supply Side: Walmart suppliers improve initiatives supporting Project Gigaton

by Kim Souza ([email protected]) 1,251 views 

Walmart’s big sustainability push known as Project Gigaton was announced in 2017 in partnership with the Sustainability Consortium. The milestone project involves Walmart’s removing 1 billion metric tons of greenhouse gas from its global supply chain by 2030.

Walmart asked suppliers to join the effort, and the retail giant continues to work with hundreds of vendors to target reducing emissions. Suppliers are scored on their sustainability efforts on everything from ingredients sourced, product packaging, waste and energy consumption.

The first year of the initiative, Walmart reported reducing more than 20 million metric tons of greenhouse gas in its global supply chain with the help of its committed suppliers. Kathleen McLaughlin, chief sustainability officer for Walmart, credited the accomplishment to the participation of several hundred suppliers and ongoing work with the Sustainability Consortium, alongside World Wildlife Fund, the Environmental Defense Funds and other non-governmental organizations.

Tyson Foods, a major meat supplier to Walmart, recently announced a new partnership with the Environmental Defense Fund (EDF) involving its own supply chain. The program focuses on land stewardship and aims to pilot and scale agricultural practices of 500,000 acres of corn that reduce greenhouse emissions, improve water quality and maximize farmer profits. The meat giant said it will work with farmers to improve environmental practice across 2 million acres of corn production by 2020.

“If the largest U.S. food company can prove the viability of farming practices that are good for the planet and for profits, it would be a game changer,” said Jenny Ahlen, director of the EDF business supply chain program. “We’re using scientific analysis to measure the benefits of sustainable farming practices, help companies like Tyson Foods evaluate the impact of their sustainability initiatives, and inspire transparency across the supply chain.”

The partnership will work to enroll farmers in a sustainable agriculture project encompassing 30 million acres overseen by the EDF piloting new methods that reduce nitrogen usage, a big contributor to greenhouse gases. Tyson Foods’ supply chain includes corn, a major feed ingredient used to grow chickens that are processed and sold to retailers like Walmart.

“Developing a sustainable food system is important to our business and the planet,” said Justin Whitmore, chief sustainability officer for Tyson Foods. “Joining forces with EDF enables us to bring together the best of our joint expertise in supply chains and sustainable agriculture, and deliver value to growers, businesses and the environment.”

The Tyson Foods/EDF partnership will help the Walmart suppliers improve their scores on the retail giant’s sustainability index. It also fulfills the company’s promise to shareholders and customers to reduce its carbon footprint.

Walmart’s sustainability index includes reducing food wastes. General Mills, a major food supplier to Walmart, announced a partnership with Feeding America to create a closed loop in the food supply chain to reduce the estimated 20 billion pounds of farm product that goes to waste each year.

Each year, about 72 billion pounds of otherwise consumable foodstuffs never make it onto store shelves, according to estimates from Feeding America. Those figures don’t include the volumes of food that spoil either at rest or in transit. Nor does it cover the mountains of scraps thrown away every day by hotels, restaurants and consumers, the release noted.

General Mills and Feeding America recently expanded a pilot program called MealConnect Logistics, which integrates General Mills’ trucking network with Feeding America’s MealConnect IT platform. This allows truck fleets and drivers to reroute rejected food shipments to one of the 200 Feeding America food banks. Shipments rejected by the retailer or manufacturer have typically been dumped in landfills. Now, those shipments are redirected to food banks that supply 60,000 soup kitchen and food pantries across the country.

J.B. Hunt Transport Services Inc. joined the effort along with Knight-Swift Transportation Holdings Inc., XPO Logistics Inc. and Marten Transport Ltd., to have drivers reroute rejected loads to the Feeding America network.

“We have wonderful relationships with our country’s largest food manufacturers, and now their carrier partners can easily add a no-cost reverse logistics solution in serving them,” said Blake Thompson, Feeding America’s chief supply chain officer.

Feeding America said the first food bank that is offered a rejected load accepts that shipment 77% of the time. If the first food bank can’t handle the donation, the system contacts the next closest facility along a driver’s route. It’s up to the manufacturer or retailer to determine how a rejected shipment is disposed of, Thompson said.

This program is expected to save 50 million to 60 million pounds of food waste annually within three years, a good start to what will be a long journey, Thompson said.

Nicola Dixon, associate director of the General Mills Foundation, said the company has donated $1 million to expand the program and has provided supply chain expertise to automate the process via mobile app access.

General Mills, J.B. Hunt and other carriers who provide products and services to Walmart can get credit for this waste elimination effort for their sustainability index score. The effort can also be credited toward Walmart’s Project Gigaton goal.

Consumer goods company Unilever, working with Walmart, recently announced support for restoration of wildlife habitat and to help 60,000 hectares of palm oil plantations to achieve sustainability certification in connection with Project Gigaton.

The work in Malaysia aims to achieve a deforestation-free supply chain and further emission reduction. Malaysia is pushing to certify 100% of the state’s palm oil production to Roundtable on Sustainable Palm Oil (RSPO) certification by 2025. The World Wildlife Fund (WWF) estimated the effort will reduce 17 million metric tons of greenhouse emissions by 2030 and count toward Walmart’s Project Gigaton goal. With this commitment Unilever said 200 to 300 palm oil farmers will benefit from the RSPO certification.

“We are moving our sourcing to areas that have good forest management and work in partnership to reconcile competing, social, economic and environmental objectives. Our ultimate ambition is to help drive a sustainable palm oil industry,” said Jeff Seabright, chief sustainability officer for Unilever.

Walmart commended Unilever on helping implement the model in Malaysia and invited other suppliers to join the reforestation programs.

“With this partnership, Walmart and Unilever are advancing an innovative new approach to help companies meet their climate goals,” said Carter Roberts, President & CEO of World Wildlife Fund-US. “Decoupling supply chains from deforestation would deliver important benefits — reducing greenhouse gas emissions and securing essential habitats.”

Suppliers will likely hear more about Walmart’s progress on Project Gigaton at the Supplier Growth Summit in Bentonville on Feb. 26-27. Sustainable packaging was one of the topics covered at last year’s summit and continues to be one the key metrics Walmart scores suppliers with respect to its sustainability index.

EDITOR’S NOTE: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak Logistics.