A View from Walmart

In a presentation Sunday afternoon at Retail’s BIG Show, Kathleen McLaughlin, who holds the dual roles of chief sustainability officer of Walmart and president of the Walmart Foundation, announced a $2 million grant to the NRF Foundation for its Retail Industry Fundamentals training/credentialing program, developed as part of NRF’s RISE Up initiative to offer credentials and training to help entry-level job seekers build meaningful retail careers.

Walmart also announced a $2.9 million grant to the League for Innovation in the Community College for curriculum development, aimed at the same goals.

This, McLaughlin noted, is part of Walmart’s ongoing commitment to alter the way business is done and evaluated in today’s world. Fortune, she said, now publishes a new listing, “Top 50 Companies that are Changing the World.” Walmart has been high on every list, most recently for its initiative to create economic opportunity for all its stakeholders.

“I started my career at McKinsey & Company in 1990,” said McLaughlin. “All through the ‘90s, when I was consulting to clients in any sector, it didn’t matter what the project was. The end goal was always shareholder value.”

Check out the official recap for photos, videos, articles, presentations and more from Retail’s BIG Show 2017 .

Check out the official recap for photos, videos, articles, presentations and more from Retail’s BIG Show 2017 .

At the same time, she said, concepts about balancing the interests of multiple parties as the objective function of business, which had been kicking around in academia, began to seep into the business mainstream. “Today, the leading companies are now recognizing that business needs to strengthen the systems we rely on in a fundamental way. I offer you a simple proposition,” McLaughlin said. “Business exists to serve society.”

At Walmart, the transition to this point of view gained serious momentum in the fall of 2005 in the aftermath of Hurricane Katrina. The storm, considered the most expensive natural disaster in U.S. history, devastated communities along the Gulf Coast from central Florida to east Texas. In the wake of poorly executed state and federal disaster-relief efforts, Walmart found itself in the position of de facto first responder, rushing staples like water, fuel and toilet paper to thousands of refugees.

In the first days after the storm, the company contributed $20 million in cash donations, 1,500 truckloads of free merchandise, food for 100,000 meals and the promise of a job for every one of its displaced workers.

“That had a really profound effect on the leadership of Walmart — Lee Scott Jr., who was CEO at the time, in particular,” McLaughlin said. “He began asking, ‘What if we were that company every day?’ and he really started to reflect on the environment and how we can create a more sustainable model of consumption.”

Later that fall, Scott delivered a speech to the company in which he set out some goals for Walmart around sustainability: to be powered 100 percent by renewable energy, to generate zero waste and overall to have more sustainable products.

One item on Walmart’s agenda is providing economic opportunity, which the company is pursuing in several ways. One has to do with its own 2.3 million employees: Entry-level employees now come on at $9 per hour, and move up to $10 at the completion of an introductory training program, usually within six months.

“How do we get you from that to a middle skills job? Training and education,” McLaughlin said, which can involve anything from online GED or college courses to extensive on-the-job training. Noting that Walmart store managers earn an average of $170,000 per year, “75 percent of our store managers started out as hourly people,” she said. “Doug McMillon, our CEO, himself started out unloading boxes in a distribution center.”

Again, McLaughlin emphasized that Walmart’s commitment to economic opportunity, as with its initiatives in sustainability and community well-being, arises not only from a culture of being purpose-driven at Walmart, but also from an evolved understanding of what constitutes a business’s self-interest. “We can create business and social impact simultaneously,” she concluded, offering an invitation to the entire industry to share her company’s view of today’s world.

This story originally appeared in print as part of STORES Convention Daily on January 16, 2017. Download the digital edition and see more highlights from Retail’s BIG Show 2017.