Walmart’s CSR Practices: Investing in the future

Corporate Social Responsibility (CSR) is a common term used to describe positive practices performed by a company that contribute to the greater society. CSR derives from the concept of the triple bottom line, which focuses on social, economic and environmental costs and benefits of operating a business. According to Investopedia, CSR “generally applies to efforts that go beyond what may be required by regulators or environmental protection groups.” In this article I will try to evaluate CSR practices of Walmart, a corporation with  revenues of $482 Billion in 2016, and recommend potential practices to better serve the interests of small and mid-size farmers.

According to Walmart’s corporate website “When Sam Walton opened his first Walmart, it was strongly grounded in its local community. Today, Walmart’s 2.3 million associates are residents, neighbors, friends and relatives in thousands of communities around the world.” Being the world’s largest corporation, Walmart has an unrivaled opportunity to invest in practices that benefit both their business and the greater community.

Walmart’s Global Responsibility Report details their global approach towards building a better community. According to the report, Walmart believes social and environmental programs are of interest to long-term stakeholders because there is a symbiotic relationship. The report states that, Walmart gave over $1 billion annually to projects that create opportunity, enhance sustainability and strengthen community.” The infographic below shows some of the initiatives the company is taking to move towards more sustainable operations.

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Walmart’s current initiatives for community development. Image from Walmart’s 2017 Global Responsibility Report.

According to the Global Report, in the U.S., Walmart more than doubled its sales of locally grown produce from 2010 to 2015, from $404 million to $825 million and is committed to doubling it again by the year 2025. Moreover, Walmart is supporting farmer training campaigns around the world, with an aim of aiding smallholder farmers with the tools and knowledge they need to succeed. Between 2011 and 2016, the Walmart Foundation invested over 1 million dollars for farmers training programs. The company is also working with developing countries like Bangladesh, Kenya and Mexico to promote sustainable farming practices.

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A Walmart store front. Image from Talk Markets.

For a better future, some recommendations may include rapidly increasing number of local suppliers/farmers by incentivizing small scale production and launching programs that supports small family farms more rather that mass production can be helpful. Also, the company could work with other government agencies to implement sustainable practices in production and design a section dedicated for local produce to promote small farms. Moreover, increasing purchase price can be beneficial for small farmers. The annual revenue may decline at first, but it can be an investment to the future. Furthermore, establishing a healthy and supportive relationship with farmers or suppliers can help foster mutual development.

It is high time for Walmart to consider alternative supply chain by involving small farmers or suppliers more. The current efforts are commendable however, they are not impacting the society and the farming community as much as they should. A great portion of farmers remain in darkness in terms of modern training an infrastructure. Therefore, it is necessary to have a concrete plan to provide accessible resources for the welfare of the farming community.  At first, there might me some obstacles, however it is entirely feasible for a company like Walmart to implement some positive changes. After all, when a company becomes as vast as Walmart, it naturally becomes an obligation to consider the notion of triple bottom line (social, economic and environmental costs of operation) in every aspect.

– Shaikh

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