Clinton Global Initiative Panel Discussion

Clinton Global Initiative

September 26, 2007

Clinton Global Initiative

Remarks as Prepared for Delivery

On September 26, 2007, Walmart CEO Lee Scott participated in the opening plenary session at the annual meeting of the Clinton Global Initiative. 

During a panel discussion moderated by President Bill Clinton, Scott answered a few questions about Walmart’s sustainability initiatives. Following is a transcript from the session.

PRESIDENT BILL CLINTON: I’d like to go to Lee Scott, who’s made a major address in the United Kingdom, I guess a little over a year ago, about Walmart’s commitment to sustainable future, which includes a major effort to reduce their carbon footprint. And I’d like to ask him to briefly conclude, explain to us because it’s the same thing Mr. Zoellick said about what the World Bank could do for developing countries. The same thing is true of companies. How did you decide this would be good for your shareholders, for your company, and most of all, for your customers? And I’ll say an interesting thing, at least in the United States, the Walmart customers basically are people who work hard for modest incomes, they have to watch every last dollar they spend, so when they have to spend more on energy, they literally have less money to spend on their children’s education. And in America, for the last five years, we’ve had nominal economic growth, but median incomes are flat, and people are spending more for health care, for energy, for housing, and for higher education. So the economics of having extra money to spend at a Walmart store are really tough for most of his customers. And I’d like to ask him how he deals with that, and sees that in a context of this energy issue, and the whole issue of climate change.

H. LEE SCOTT, JR.: Let me first say that as I was ushered onto the stage and introduced as the President of Afghanistan, it suddenly dawned on me that there are tougher jobs in the world than the one I have. So I think if you think about the people on this stage, and you think about the people in the audience, the truth is, this world faces significant challenges, whether you’re the leader of a government, an NGO, you’re a thought leader, a global organization. At Walmart, when we looked at it, the question you had to ask yourself is, is there a role for business in these issues that society in general faces? And you had to come to terms with what has traditionally been the argument, and that is that there is a conflict between contributing to the social good, other than some percentage of profits, and running a business. And thanks to great guidance from associates, both internal and external, what we realized as a company is that if we’re going to resolve the problems that you talk about in this forum, it is going to take all of us. You cannot wait for government, business already has a bias for action, business has the ability to allocate capital, both human capital and financial capital, to address issues. Business has the opportunity to create innovation that will, in fact, resolve many of the problems that we talk about when it comes to climate change. And what has, I guess shocked us, is the fact that there are benefits far beyond what we thought about.

First of all, our whole premise is that we save people money so that they can live better. Well, what we found is we’ve gone down this journey in sustainability, is the first things we’re doing is we are taking waste out of this whole stream of products and things that all of us are using. And they’re not exotic decisions. One I talked to General Mills about is that they straightened the noodles on the hamburger helper, and more noodles go into the box, and the boxes are now smaller. And thousands of tons of waste are eliminated, truck loads of movement are eliminated, fuel is eliminated. And it is basic good business practices that ultimately cause the price of the product itself to go down.

And it is better for the environment, and in our case, one of the things I underestimated, two things I underestimated. One is that our suppliers were waiting for us to ask. And when we started asking the question, they actually accelerated. And number two is I had no idea of the momentum that our associates would feel, the pride they would feel from this. Not just in the US, but in San Jose, Costa Rica; in Argentina; the people in the UK said we’ve been wondering when is Walmart going to do this. Our dot com business in San Francisco. The level of pride and enthusiasm and commitment among our associates has been incredible. And at the same time, what it does it allows those working people you’re talking about, they get to participate in sustainability without having to sacrifice their standard of living.

CLINTON: Let me just, let me ask you a couple of questions. How are you doing on selling those 100 million compact fluorescent bulbs?

SCOTT: Well, we’re going to make it. We were in Saddlebrook, New Jersey yesterday helping at a side counter, and did sell a four pack of 60 watt to one of our customers, and I, we are on track to sell the 100 million compact fluorescent light bulbs, and to make an extraordinary difference for our customers in their expense, and in the use of fuel.

CLINTON: Now we’re all laughing, but if this one company sells 100 million of those light bulbs, and people screw them in and use them, it has the effect of taking 700,000 cars off the road. Is that about right?

SCOTT: Off the road.

CLINTON: And they reduce their packaging by five percent, right? Save the supply chain $3.5 billion, has the affect of taking 210,000 diesel trucks off the road that get six miles to the gallon. That about right? And to give you an idea, this whole efficiency thing is not just for rich countries, or wasteful people. A young friend of my daughter’s who works at Goldman Sachs gave me a study they commissioned the other day that claimed that if the United States, Russia, India, and china, simply reached the energy efficiency levels of Japan, with no new clean energy production, just the efficiency levels, we’d cut greenhouse gases 20-percent lower than they’d otherwise be over the next few years. And the Energy Department says if everybody got out of incandescent light bulbs, it would obviate the need for 80 power plants just in the United States, just the lighting. So Walmart is providing a systematic way for us to deal with this.