This week Walmart agreed to pay $27.6 million to settle allegations that it improperly disposed of hazardous waste at stores across California.
The settlement stems from an investigation started five years ago after an off-duty San Diego County Department of Environmental Health employee noticed a Walmart employee pouring bleach down an open drain. Further investigation uncovered numerous other violations of environmental laws at several stores in California.
To those familiar with Walmart’s landmark sustainability efforts, the record fine seems to fly in the face of a growing respect for the company as an environmental leader.
In fact, at the time the violations were uncovered Walmart’s environmental compliance policy was scatter-shot at best, according to Phyllis Harris, Walmart’s vice president of Environmental Compliance.
“We didn’t have a policy,” Harris admitted–a disturbing admission from the third largest company in the world.
Walmart’s first step after the California investigation began was to hire Ms. Harris, who was working for the US Environmental Protection Agency at the time. “Looking at Walmart, I thought it was a great opportunity to make an impact,” given the size and reach of the company, she said.
Harris immediately centralized environmental compliance at Walmart under her department, and then began her own investigation into how the company deals with hazardous waste at its stores.
Retail stores are required to handle disposal of toxic chemicals very differently from individuals. An individual can throw a half-empty bottle of Drano in the trash, but a store must dispose of the chemicals in a more regulated way, under the same rules that apply to chemical plants and refineries.
One major challenge for Harris: how do you explain these complex environmental regulations to Walmart employees, some of whom may have only a basic education?
“I have to assume that anybody I see walking down the street, they may come work at Walmart at some point,” Harris said.
The company put up clear, simple sheets in stores that explain what to do with different types of hazardous wastes, as well as color-coded containers for different types of materials.
Walmart also created a database of all hazardous products the company sells and linked it to terminals in every store so that, for example, when a customer returned a damaged bottle of detergent, an employee could scan it and the computer would tell them exactly where to put the bottle of detergent for disposal.
Using that database, the company has been able to track which products most frequently end up damaged and pass that information on to the supplier.
“We can go back to the supplier and say ‘we need you to relook at this item so we can better display it,'” said Harris.
Harris notes the changes the company has made in its environmental compliance program are the first of its kind in the retail sector. And Walmart gained the respect of the San Diego District Attorney Bonnie M. Dumanis, who said “the company deserves credit for taking this seriously.”
Is it possible Walmart’s brush with the law (a similar investigation in Missouri is still ongoing) scared it straight when it comes to environmental compliance? Harris was circumspect.
“For any company, having allegations like this would be a driver,” Harris said. “But I think that to the degree of what we have done over the 4 years I’m very confident that Walmart has a model program.”