Can Wal-Mart save the world?

I am reading a tremendous book which I recommend to anyone who has even a passing interest in business and globalization. The book is The Wal-Mart Effect by Charles Fishman. Though I have not quite finished it, I have read enough to recommend it.

Fishman does a good job of presenting good and bad sides of the world's largest ever corporation. First the scale  - every week more than 100 million Americans shop at Wal-Mart - 1/3 the population EVERY DAY!!!!! Their sales are equal to over $2000 for every family in the US, and their profit is a miniscule $75 on that $2000.

And it is not just the U.S. that it dominates.This year 7.2 billion people will shop at Wal-Mart - more than the population of earth. It employs 1.6 million people. It is as big as Home Depot, Kroger, Target, Costco, Sears and Kmart combined!

To their credit, Wal-Mart is single mindedly clear on their vision - everyday low prices. Everything works back from that - cut prices low, lower, lower - 5% every year from the same suppliers. That was Sam Walton's original vision. And with their low prices they have made countless goods affordable for low income people.

The price has been significant. They have driven incredible efficiencies in every supplier that provides goods to them - and driven many out of business. They have been well criticized for their labor laws, exploitive in the name of "low prices". They have changed consumerism by making things so inexpensive that they are suddenly disposable. So we by many of something that is cheap and throw them out wen they break.

The environmental impact of this alone has been disastrous. The packaging alone from the goods Wal-Mart sells is large beyond comprehension, and how much really gets recycled? In industries like salmon farming, a business they literally created in Chile, the fish feces, antibiotics and waste in the ocean from the farms is destroying areas of ocean.

So here is the good news. Wal-Mart has committed to a policy of sustainability. Maybe Al Gore had a chat with them, but apparently Wal-Mart's environmental policy is about to get tough. Reduced energy consumption and reduced packaging is the new mantra, and they are forcing their suppliers - which is every notable consumer brand in the world - to either shape up or be off the supplier list.

Wal-Mart's motives are not important to me. You either love Wal-Mart or hate them, and that will probably pre-determine whether you think this is just a PR ploy.

What is important is the opportunity. While politicians around the world screw around with Kyoto and voluntary controls and politician posturing, with no impact, the world's most powerful company could make a HUGE impact on the environment by drawing up tough, across-the-board policies and forcing their suppliers to tow the line the same way they have on costs.

Will they be smart enough to allow the costs to be borne in their pricing?  Will they be committed enough to put their own money where their mouth is? And will their customers happily pay 10% or 20% more to save the planet?

Only time will tell. Wal-Mart is in a position to change the world for the better and create a new generation of grateful consumers. Will they be wise enough to be the leaders they ought to be?

Apparently we're all about to find out.