Wal-Mart: Values-based Capitalism at its Best
Not long ago Wal-Mart was held up as an example of all things wrong with capitalism. Exploitative of workers, the accusations went. Hurts the domestic economy by purchasing too much inventory from abroad. Destroyer of local cultures in other countries. Monopolist. Union buster.
Well, Wal-Mart has certainly turned that perception around over the last two years, to the point where Harvard Business School professor Rosabeth Moss Kanter calls the world's largest retailer "values-based capitalism at its best."
Where did Wal-Mart go right? It's embrace of green products and technologies since 2007 is one major reason. Wal-Mart was one of the first companies to push alternative technologies such as compact fluorescent light bulbs, which it offered at value prices.
But the company REALLY made headlines in July with news that it would rate products from its more than 100,000 suppliers based upon their impact on the environment, ratings that will be made available to consumers to make the final choice.
Wal-Mart has transformed itself from greedy capitalist exploiting society to enlightened capitalist enhancing society.
Clearly, Wal-Mart would not take such action if it didn't make good business sense, Kanter acknowledges in her Harvard Business Publishing blog post Wal-Mart's Environmental Game-Changer. But...
"Today Wal-Mart reminds us that a new kind of capitalism is possible in which big companies can use their power constructively, for the good of society and to move on issues that are still largely unaddressed by government."Has Wal-Mart's green shift changed your perception of the company? Are you more likely to shop their now given its new Sustainability Index? Is this a model of how companies must act in the future?
And a more cynical question: Is green and corporate social responsibility the best corrective path for companies with tarnished brands to find their way back into favor with consumers?
Related reading:
Wal-Mart Exposes the De-Value Chain
'Emotional intelligence' author Daniel Goleman says the Wal-Mart Sustainability Index "marks the dawning of the age of ecological transparency in the marketplace."Will Wal-Mart Create the New Green Standard?
BNET's Stefan Deeran says Wal-Mart will have its hands full creating a system relevant "to all consumers and also legitimate to environmentalists."(Wal-Mart cart image by Richard Monteverde, CC 2.0)