Wal-Mart Reputation Problems Lead to Massive Image Overhaul

In case you hadn’t noticed, Wal-Mart has received some criticism for its business practices over the last few years. Condemnations of low wages, discrimination, environmental damage, damage to local economies and sweatshop sourcing have come at Wal-Mart from all angles. At some point, someone at the company realized these attacks might be bad for business.

So the company went on the offensive. Charles Fishman, author of The Wal-Mart Effect, explained to a conference of editorial writers this week that in recent months, Wal-Mart has made a massive effort to improve its image. Whereas the retailer once focused on lowering prices regardless of the cost, attacks on the company’s ethics made Wal-Mart realize the high price of behaving badly.

Fishman is certainly right on this point: after years of criticism, it seems Wal-Mart’s leadership finally recognized the value of a good reputation. Since its revelation, Wal-Mart has worked to highlight not only its low prices but its good deeds too, spending millions to publicize its environmental efforts and charitable giving. A new ad campaign, a new slogan and numerous public appearances by company executives drive home Wal-Mart’s new message: We’re not all bad, really.

Wal-Mart’s work to become a socially responsible company, however, is far from done. The company’s labor problems remain completely unresolved: wages and benefits for hourly workers are still paltry, allegations of union-busting remain rampant, and the company’s discriminatory practices have resulted in dozens of lawsuits in the last year alone. Labor issues are the most expensive to resolve, but a recent study (PDF) shows that shoppers take a company’s labor practices into consideration above all other social responsibility issues. The company cannot and will not succeed with its image overhaul until these issues are addressed.

Even Wal-Mart’s highly-touted environmental campaign has problems. While the company cites reduced packaging and organic cotton among its crowning achievements, Wal-Mart’s massive energy consumption, unsustainable land use, and unethical sourcing practices negate any positive impact the company might have. Poor product quality contributes to environmental problems too, and several recalls over the last year and a half reveal the high price of cutting costs. The company’s relationship with local communities continues to be a problem as well.

Like Mr. Fishman, we are also interested to know the impact of Wal-Mart’s environmental footprint - both good and bad. But any examination of Wal-Mart’s sustainability efforts should take into account the company as a whole - with all its problems, from factory to shopping cart - not just the side Wal-Mart wants us to see.

Two say Wal-Mart image on mend [Arkansas Democrat-Gazette]