In every new initiative Walmart develops, one goal remains at the core: commitment to the customer. That commitment goes far beyond low prices and customer service. It’s a promise reaching as local as the community, but as big as the world.
In 2017, Walmart renewed its focus on the environment. The company recognized its responsibility to lead the way in preserving natural resources for future generations. In an effort to partner with suppliers in improving processes to protect the earth, Walmart launched Project Gigaton.
What Is Walmart’s Project Gigaton?
Walmart’s Project Gigaton is an initiative in partnership with suppliers and other stakeholders to reduce or remove one billion metric tons (a gigaton) of greenhouse gases from the climate by 2030.
At the launch of Project Gigaton in 2017, Laura Philips, the SVP for Walmart Sustainability during that time, clarified the purpose and goal of the initiative:
“Walmart is committed to reducing emissions within our own operations as well as with our suppliers throughout the entire value chain,” Phillips said. “The challenge we’ve signed up for with our suppliers is to take out a billion metric tons of emissions. That’s a gigaton. Our challenge together that we launched at the recent Milestone Meeting is to work with our suppliers across different areas of work to take out a gigaton of emissions by the year 2030.”
What’s the Latest With Project Gigaton?
Since its launch in 2017, Project Gigaton has hit major milestones. Some of the highlights of the last few years include:
Adding Supplier Support
Some Walmart suppliers are eager to participate in Project Gigaton, but may not have the money or resources to refine their processes. To aid eligible suppliers, Walmart launched Gigaton PPA in 2020.
Gigaton PPA is a partnership with Schneider Electric. The program gives suppliers access to renewable energy and educates them on better energy purchases.
Financing for Private Brand Efforts
As the success of Project Gigaton grew, Walmart expanded a supplier financing program in 2021. This initiative gave enhanced financing to Walmart’s private brand suppliers. These are suppliers who set science-based emissions targets meeting specific reporting conditions.
Passing the Halfway Mark
In April of 2022, Walmart announced it had passed the halfway mark in reducing 1 billion metric tons of greenhouse gas emissions from supply chains. The goal still remains to remove or avoid a gigaton of greenhouse gases from the climate by 2030. The company also reported that over 4,500 Walmart suppliers had signed up for Project Gigaton. These suppliers (as of 2022) reduced or avoided over 574 million metric tons of emissions.
Why Is Project Gigaton Important for Suppliers?
The average company supplying to Walmart may appreciate the effort being made in Project Gigaton. Walmart is a global presence and certainly has a responsibility to give back considering its footprint. But what is the personal interest for the supplier?
The interest in getting behind the initiative from the supplier perspective lies in the numbers for supply chain. With the day-to-day activity of doing business, suppliers may not always think in terms of natural resources, but experts measure the long-term impact.
For example, today’s supply chain is one of the largest contributors to greenhouse gas emissions; by the latest measurements, over 60 percent can be traced back to supply chain. Water is also a consideration. Supply chain claims 80 percent responsibility for use of water.
We can’t talk about natural resources without mentioning tropical rainforests. In the category of deforestation, supply chain also plays a huge part. Supply chain is currently responsible for almost 70 percent of tropical deforestation.
Walmart recognizes supply chain’s impact on the environment. That’s why Project Gigaton is not a lone Walmart initiative, but a partnership with its suppliers to make a positive change. Many businesses, large or small, all doing their part will have a powerful influence on the future.
The 6 Pillars of Project Gigaton Explained
To help suppliers focus on specific areas to set goals, Project Gigaton centers around six pillars. Walmart does not expect suppliers to focus on all six. When signing up to participate in Project Gigaton, they may select to focus on one or more.
Energy makes up the highest cost of keeping the supply chain in motion. This energy may be fuel for trucks or electricity burned during business hours. In addition to cost, those fuel emissions are the leading cause of environmental danger. Improving the energy powering the supply chain will protect the environment and has the potential to lower costs.
Under the energy pillar, Walmart asks that suppliers work to reduce emissions. This is encouraged by minimizing the demand through a more efficient and optimized supply chain. The company also wants to see suppliers find renewable energy sources that have very little or no carbon emissions.
The nature pillar of Walmart’s Project Gigaton focuses on the issue of deforestation. Studies show that most tropical deforestation is driven by growing agricultural commodities. Commodities like wood fiber, cattle, cocoa, soy, and palm oil are expanding which has led to the current deforestation crisis.
Walmart is asking suppliers to work on reducing emissions at the farm level. They are also asked to participate in initiatives that restore critical forests and support landscape approaches in key production regions.
Food waste alone is a major threat to the environment. Recent studies have shown that food waste is responsible for at least 10% of global emissions.
When suppliers commit to Project Gigaton, they are asked to examine the amount of food, material, and product waste being produced in their factories, warehouses, distribution centers, and farms. To further improve the supply chain, lower costs, and protect the environment, suppliers are asked to reduce the amount of waste going into landfills.
4. Product Use and Design
Under the product use and design pillar, Walmart goes beyond waste and emissions. It challenges suppliers to improve the very products they make.
Suppliers are asked to incorporate sustainable materials when creating their items. To reduce the overall carbon footprint of the company, suppliers can work to use recycled materials in their products.
Research from the Ellen MacArthur Foundation revealed that less than 14% of plastic packaging worldwide was collected for recycling in 2016. Walmart encourages suppliers to review their packaging to not only support recycling but also to optimize their designs and source sustainably.
Packaging is such a major part of the supply chain that simple improvements can create major environmental improvements over time. Walmart is asking suppliers to embrace the “circular economy” production process. The circular economy is one that reuses and regenerates materials and energy.
Walmart is taking its own transportation goals seriously and aggressively. The company is working toward electric cars and trucks for its US and Canada fleets. Walmart’s goal is to have zero emissions from its vehicles by 2040.
Walmart suppliers are encouraged to reduce their vehicle emissions as well. In addition to lowering total emissions, suppliers are also challenged to find ways to reduce their total miles of truck transport.
How to Participate in Project Gigaton
Project Gigaton is going strong, but always has room for more Walmart suppliers! Participation in the program is as easy as following these simple steps:
1. Register to participate
Signing up to participate in Project Gigaton starts by visiting Walmart’s Sustainability Hub. From here, suppliers set up their accounts and manage participation.
2. Determine Goals
Each supplier needs to work within their company to set realistic emissions reduction goals.
3. Report Back to Walmart
Suppliers will go back to the Sustainability Hub to report on their progress. Walmart will recognize suppliers for their yearly progress.
Project Gigaton FAQ
What is a gigaton of emissions?
A gigaton of emissions is equal to one billion metric tons of CO2 emissions.
What happens after suppliers sign up for Project Gigaton?
Walmart suppliers are simply asked to keep the information in their Project Gigaton account up to date. Suppliers will be required to report on their emissions reductions each year. Failure to submit a report will impact the supplier’s eligibility for recognition.
Once a supplier sets a goal, can the goal be changed later?
Yes. As circumstances change, suppliers can change or update their goals on the account page created in the Sustainability Hub.
How many pillars does a supplier need to support?
Suppliers are not required to select all six pillars in the sign-up process. They may choose one or multiple pillars depending on the goals they set.
Does Walmart expect suppliers to set huge goals?
Walmart leaves the Project Gigaton goal-setting strictly up to the suppliers. Goals should be bold, but attainable.
When do suppliers report their progress back to Walmart?
Reporting usually happens once a year in Walmart’s third quarter. Reporting is done through the supplier’s Project Gigaton account in Sustainability Hub. Any dates or changes will be sent to suppliers via email.
Will a supplier’s participation in Project Gigaton be made public?
Not without the supplier’s consent. Permission to make participation public can be selected in the supplier’s Project Gigaton account.
How much does Walmart charge to participate in Project Gigaton?
There is no cost to the supplier to participate in Project Gigaton.
As a current or aspiring Walmart supplier, it’s important to understand Walmart’s expectations for keeping your supply chain sustainable. Walmart is heavily invested in providing quality, low-priced goods for its customers and doing its part to protect and preserve the environment.
If you have questions about Walmart’s expectations or would like assistance in improving your supply chain, we can help! Our Walmart advisors can help you improve supply chain measurements from fulfillment to sustainability. Request a free 15-consultation with our team this week.