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The Wal-Mart Effect

Emma Ritch

Wal-Mart’s ambitious plan to green its supply chain has trickled down to Redwood City, Calif.-based environmental and energy management startup Hara. And to hear Hara’s CEO Amit Chatterjee tell it, this is just the beginning.

Call it the Wal-Mart Effect. The retailing giant announced plans in February to cut 20 million metric tons of greenhouse gas emissions from its supply chain by the end of 2015. The catch is that it’s Wal-Mart’s suppliers making the changes to how they do business.

“It resulted in suddenly a shock across commodities manufacturing players,” Chatterjee told me. Manufacturers were left asking “how does my supply chain look, and how does it fit to Wal-Mart’s standards?”

“Wal-Mart has shaken the foundation of a lot of companies that never cared about this before,” Chatterjee said.

In comes Hara. The startup’s carbon accounting software can help companies track consumption of energy and natural resources across global supply chains. That visibility into consumption and emissions is the first step in reducing the use of energy, water and other resources, says Hara’s Chief Green Officer Michel Gelobter.

Just last week the startup revealed its first publicly announced deal linked to the Wal-Mart Effect. Toy maker Hasbro is now deploying the Hara Environmental and Energy Management software across its global operations.

It’s part of the company’s broader environmental strategy. Hasbro was heralded as the top toy maker taking action to reduce its environmental impact in a survey released last year by Climate Counts.

The obvious question is, of course, what’s the carbon footprint of Mr. Potato Head? Although Chatterjee couldn’t give me an answer, you can imagine that’s the type of granular carbon accounting that we’ll see on packages in the near future.

Hasbro is one of three types of customers Hara is seeing. Hasbro falls into the “voluntary” category, prompted by shareholder and customer requests.

Hara’s also seeing traction in the public sector, including the city of Palo Alto, Calif. Competitor ENXSuite (formerly Carbonetworks) is working with the city of Chicago–and presenting a case study on the project at our upcoming Cleantech Focus Chicago, Smart Buildings: Energy Efficiency in the Built Environment.

The third category of growth is amongst regulated companies, such as oil and gas, utility, and chemical firms, Chatterjee said.

Hara’s software is now at work in 90 countries with 35 customers, including Diebold, Coca-Cola, Apple, Safeway and News Corporation.

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  • http://twitter.com/LEEDTHEWAY Chris Moline LEED AP

    Your post is a breath of fresh air. I'd written in another blog about the “trickle down” effect and how WalMart will be the best example given that their actions affect so many. So glad to read your piece!

  • http://twitter.com/eritch Emma Ritch

    Thanks, Chris. Wal-Mart is enacting many efficiency measures, but some of the most visible will be those impacting its suppliers. It will definitely have a huge ripple effect across the industry.