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    Sustainability and EnvironmentSustainability and Environment

    Andy RubenAndy Ruben

    Vice President , Company Strategy/SustainabilityVice President , Company Strategy/Sustainability

    WalWal--Mart Stores, Inc.Mart Stores, Inc.

    May 18, 2006May 18, 2006

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    2Version: 5/24/2006 8:45:37 AMWal-Mart Stores, Inc.

    Confidential - Do Not Distribute

    To create zero waste

    25% reduction insolid waste in 3years

    All private brandpackaging improved

    in 2 years (rightsized, reusablematerials)

    To be supplied 100%by renewable energy

    Existing stores 20%more efficient in 7years

    New stores 30%more efficient in 4

    years Fleet 25% more

    efficient in 3 years,double in 10 years

    To sell products thatsustain our resources& environment

    20% supply basealigned in 3 years

    Preference given toaligned suppliers in 2years

    Design and supportGreen Company inChina

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    Today there are 6.3 billion people.

    In 2025 there will be 8 billion people.

    What will it take to provide for everyone?

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    Confidential - Do Not Distribute Earth from Above

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    Global TradeIncreasing at an Increasing Rate

    $0.0

    $1.0

    $2.0

    $3.0

    $4.0

    $5.0

    $6.0

    $7.0

    $8.0

    $9.0

    1973 1983 1993 2003

    "When a Brazilian brews hermorning coffee today, she islikely to use electricity from apower plant in Uruguay thatruns on natural gas fromArgentina provided by a

    Chilean company. She drivesto work in a Ford fueled withMexican gasoline, and herCanadian-owned factory ispowered by a natural gas

    pipeline from Bolivia."

    - Mack MacLarty, FormerWhite House official andCSIS Senior Advisor

    $ Trillions of Trade

    CAGR3.2%

    CAGR3.5%

    CAGR4.8%

    Source: World Trade Organization, 2004Note: all data in 2003 dollars

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    Of the worlds 100 largest economic entities,42 are now corporations, not countries

    -CSIS, 2004

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    when in fact they represent gatewaysfor Wal-Mart in becoming the mostcompetitive and innovative company in

    the world.

    Weve been dealing with jobs, healthcare,community involvement, product sourcing,diversity and environment from a defensive

    posture

    - Lee Scott, 21stCentury Leadership, Oct 2005

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    Sustainability at Wal-Mart

    Its about the customer and creating more

    value for ALL customers- the democratization of sustainability

    It is the business

    Its about becoming a better company

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    Auxiliary Power

    Units (APUs)

    FY07 Test

    PrivateFleet

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    Zero Waste

    Kid ConnectionPrivate Brand Toy

    Sandwich Bale

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    All MightyRetail/CPG Partnership

    ANNUAL IMPLIATIONS OF CATEGORY SHIFT

    Gallons of water Saved478.1MM

    Gallons of Diesel Saved.20.7MM

    Reduced # of Trucks..2.79MM

    Plastic Resin Reduction...128.9MM lbs

    Reduced # of out of Stocks..50%

    Reduced in Labor Dollars...$91.4MM

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    EDLC+

    Awareness of unintended consequences Potential to add more value for customers

    Democratization of sustainability

    requires systems thinking,solutions, execution

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    Co2

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    Network Structure

    Measure andReward

    -Relevant

    metrics- Ability to measure

    Design and Explore

    Innovation Pilots

    - e.g., Organic cotton

    Develop EducationStrategies

    - Suppliers- Associates- Public and policymakers

    Leadership SuppliersLarge and small

    Multi-levelWal-Mart MerchantsCross categoryCross marketsSupport functions

    Outside ExpertsNGOsGovernmentAcademics

    SustainableValue

    Networks

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    WASTE

    Operations andInternalProcurement

    Packaging

    CLIMATE

    Global GreenhouseGas

    Energy, Design,construction andMaintenance

    Global Logistics Alternative Fuels

    PRODUCTS

    Apparel Electronics Food and Ag

    Forest and Paper Chemical Intensive Jewelry Seafood China

    Initial 13 14 Networks/

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    NetworkExpectations

    Low Hanging Fruit

    Innovation(Supply Chain)

    GameChanger(Industry)

    eg, wax coating ofchicken box

    right sized TV/DVDcombo

    eg, organic cotton fair trade coffee LED lighting

    eg, electricity market

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    Packaging PrinciplesonRetail Link

    Remove Packaging

    Reduce Packaging

    Reuse Packaging

    Renew (able) Packaging

    Recycle (able) Packaging

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    Mindset Shift Requires New Set ofGlasses

    ReadEcology of Commerce, PaulHawken

    Mid-Course Correction, Ray

    Anderson

    BehaviorReduce your trash at

    work/homeConsider take, make, wastelife f products you useHigh efficiency bulbs

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    One Incandescent Bulb

    One CFLUses 80% less electricity.Saves $30-$80 on power bill.

    Prevents 500 pounds of coal or1 barrel of oil from being burned.*Majority of US electricity comes from coal fired power plants

    Keeps a ton of greenhouse gas(c02) out of the air.

    Lasts 8 to 12 times longer > keeps 8-12

    bulbs from the landfill.

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    Every Customer Switches 1 Bulb

    + $3 billion saved on power bills.

    50 billion pounds of coal preventedfrom being burned.

    2 million cars worth of greenhousegases kept out of our air. (100 million tons)

    1 billion incandescent bulbs keptfrom the landfill.

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