Business

Wednesday September 30, 2009

Sustainable business

Wal-Mart, Conservation International chiefs working with Bursa on environmental sustainability initiatives


KUALA LUMPUR: Wal-Mart Stores Inc chairman Robson Walton and top officials of Conservation International (CI) are working with Bursa Malaysia and possibly the Malaysian government on the development of environmental sustainability initiatives.

“Business, as a central part of corporate responsibility, provides employment and involves the use of natural resources,” CI chairman and CEO Peter Seligman told StarBiz. “We will assist in developing capacity to support business in Malaysia while also looking into environmental issues.’’

Bursa Malaysia CEO Datuk Yusli Mohd Yusoff in reply to a query from StarBiz said that “there is nothing firm yet but we want to explore possible areas of collaboration where we can leverage on their experience in helping corporates in the United States improve their business sustainability, for example, Wal-Mart.’’

Yusli added that discussions included environment, social and governance (ESG) issues and how to create more sustainable businesses through good ESG practices.

Working with Bursa is seen as part of CI’s evolution to be more strategic in its focus.

“We started work at the retail level but have been overwhelmed by companies showing interest in sustainability,’’ Seligman said.

Discussions with Bursa, which is working on a sustainability index for companies, could centre on, among other things, the development of a matrix by which the performance of companies in corporate responsibility (CR) would be evaluated.

“It is a journey and cannot be done overnight,’’ Seligman said.

Companies must not be afraid of being labelled imperfect, take the plunge and be held accountable for its commitment, according to Seligman.

“It is essential for Malaysia, which is a part of the international marketplace, to address the sustainability issue,’’ he said, adding that the country could be out of the competition if it did not act fast.

Seligman said CI, which also has actor Harrison Ford as one of its vice-chairmen, had also discussed the setting up of a conservation trust fund with the Malaysian government.

“It is a programme that is driven by the government,’’ he said. “Our experience worldwide shows that while investing in natural resources, the sustainability issue is often overlooked. We have to get a sustainable source of financing for the management of natural resources.’’

Various operational issues include finding multilateral and bilateral agencies, including private donors, to contribute as well as the disbursement of funds.

“At Wal-Mart, the concerns for sustainability are incorporated and embedded in our business strategies and we have found it to be financially rewarding,’’ said Walton, who is also chairman of the Centre for Environmental Leadership in Business.

Wal-Mart’s sustainability initiatives started four years ago, involving substantial cost savings through repackaging, lighting and installation of auxilliary power units in its truck fleet.

“Recently, to provide a level of transparency, we are working on a sustainability index that involves collaboration with NGOs, scientists and vendors.

“We evaluate vendors and their products, their commitment to conservation and value to us and the consumers for more bottomline results,’’ Walton said.

At Wal-Mart, the sustainability effort is driven top down.

The retailer’s suppliers are basically asked four questions, pertaining to price per unit, quality, ability to supply the amounts required and sustainability practices, such as the environmental impact of goods supplied.

“It focuses on great value and how to live better,’’ Walton said. “That appeals to our management and releases the creative energies of the group.’’

Seligman said “our experience is not just with Wal-Mart but other corporations from retailing to banking.”

“The problem is business needs a predictable environment and does not like volatile prices. In fact, Wal-Mart was reluctant at first. Having Wal-Mart engaged was a great step,’’ he said.

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