By GreenBiz Staff
Published December 04, 2009
OAKLAND, CA — Walmart shook up the retail landscape last summer when it announced it would begin surveying suppliers on their environmental performance in order to one day rate the sustainability of its products.
The initiative also launched the Sustainability Consortium, a group representing government, NGO, academic and business interests that would develop the standards to be used to rate the sustainable attributes of products.
The world’s largest retailer was careful at the time to say it didn’t want to own the Consortium. Four months later and still very much in its formative stage, the Consortium, chaired by two leading academics, is working to bring other retailers, manufacturers and NGOs into the fold. At the same time, many companies are still wondering: What exactly is the Consortium going to do and should they join?
GreenBiz.com Executive Editor Joel Makower sat down with Co-Directors Jay Golden and Jon Johnson this week to explore the role of the new organization in a webcast titled, “Inside the Sustainability Consortium: What You Need to Know.” The 90-minute conversation shed light on the Consortium’s limited role, the misconceptions surrounding it, and the benefits of membership, which can cost up to $100,000 a year for a three-year commitment.
Although a byproduct of Walmart’s Sustainability Index initiative, Golden and Johnson sought to distance the Consortium from the company. “The Walmart Supplier Sustainability Assessment Tool is really not directly relevant or related to what we’re doing,” Johnson said. “What we’re doing is creating a system that would enable companies to get information on product categories or products. It’s not at the company level.”
Instead, the Consortium will work to build the scientific platform that companies can use to assess the environmental impacts of consumer products over their lifecycle.
“After looking a lot of different approaches to creating a scientific foundation, we have come to the conclusion that if you don’t account for actual impacts for the use of consumer goods over their entire lifecycles, you’re likely to make bad decisions,” according to Johnson, who hails from the Sam Walton College of Business at the University of Arkansas.
The Consortium will work to develop methodologies and tools to help companies find innovative ways to make products with fewer environmental impacts. But the group won’t have a say in what those products will look like, or how they rank compared to their competitors. It doesn’t plan to validate or audit anyone’s LCA either.
“We are not in the game of creating an index,” Johnson said. “We are not in the game of creating a consumer label or anything else.”
The Consortium plans to make its data available in an open source framework called Earthster, which is now in its beta-testing version but its second iteration will launch in mid-2010. The pair hope to use Earthster as the initial de facto tool for open source lifecycle modeling, but haven’t committed to using it long-term.
To get the ball rolling, the Consortium has launched sectoral projects in order to begin developing infrastructure, tools and prototype metrics. An electronics sector pilot just launched and an apparel project is pending; food-agriculture and home-personal care sector pilots are underway.
Many big-name companies have signed on as founding members, including P&G, Dell, SC Johnson, Unilever and Waste Management, although Walmart and Disney are the only retailers on its steering committee to date, a number which Johnson and Golden are working furiously to increase.
“We regard it as pretty much our top priority right now of engaging other retailers, as well as continue to engage consumer goods manufacturers, NGOs and other academic institutions,” Johnson said. “But retailers are of particular interest to us. The sooner we get them engaged in the Consortium, the sooner we get them a seat on the steering committee, the sooner we can go forward.”
Members will enjoy first-mover advantages and the ability to interact with a variety of disciplines. The broader research of the magnitude to be explored by the Consortium can also carry a hefty price tag, said Golden, of Arizona State University.
“If we tried to do this traditionally,” Golden said, “the costs would be a non-starter.”
The 90-minute webcast will be archived for 90 days; if you have already signed up, you can go back at any time and listen and download the slides. You can also still register for the webcast by clicking on http://tinyurl.com/consortiumwebinar.