22 Mar Leslie Dach, Walmart VP, On Business And Social Good
As sustainability, and double or triple bottom lines move increasingly to the forefront of business leaders’ minds, one example of real progress might come from a seemingly unlikely place.
Though struggles with labor unions and various scandals still swirl around company headquarters in Bentonville, Ark., global retailer Walmart has instituted concrete, measurable initiatives geared toward social good in recent years, thanks in large part to Leslie Dach.
Dach, who has served as executive vice president of corporate affairs since 2006, was brought in to help revive Walmart’s tarnished image and implement real, lasting change. After almost seven years at the company, Dach announced his resignation two weeks ago and plans to end his weekly commute from Washington in June to spend more time with family and find his next challenge.
Dach spoke with The Huffington Post about his time at Walmart and the challenges corporations face when trying to transition into more sustainable, socially responsible roles.
The Huffington Post: What do you consider to be your most noteworthy accomplishments in terms of transforming Walmart’s culture and placing an emphasis on social good? What was successful? What wasn’t?
Dach: I think, to me, the most noteworthy accomplishment is being able to show that a big business and particularly one that has a reputation for watching its pennies, can take on these large social issues in a big way and make a big difference, but also build a stronger business at the same time. Hopefully that’s a bit of a model, not only for Walmart, but for other businesses as well. There’s been a lot of talk over time about various models and the triple bottom line, etc. I think that one of the things we’ve been able to do is to say that you can make a big difference on sustainability, you can hire veterans, you can pledge $20 billion in sourcing for women-owned businesses, and all those things will help communities but they will also make Walmart a stronger business. They’ll help us recruit better people because there are a lot of retailers you can work for, but if you can work for a retailer and also help the environment, what a great thing for you and what a great thing for us to attract you.
Many of these things actually reduce costs. That’s been another one of these false confrontations. I spent a lot of my career as an environmental advocate, on the NGO side, working in politics and there were a lot of people who tried to make the argument that there’s a conflict between being sustainable, and running a good business and creating jobs. So being able to show that that simply isn’t true — that you can do very meaningful things in sustainability, and you can do it in a way that helps your company’s economics, is another important lesson out of all of this.
HuffPost: When you took the position in 2006, Walmart’s public image was struggling. Did that give you pause or make your decision more difficult?
Dach: It certainly gave my friends pause. But to me the difference was that I believed that the leadership of Walmart — the board, the CEO — I believed that they wanted to be a better company. To me, that was the difference. In my experience in consulting, there were many companies who wanted to be thought of as a better company, but who were unwilling to be a better company. There’s a fundamental issue there, where other companies would say, ‘We’re misunderstood. If people just knew about us, people would love us. If we just got more publicity around these things we’re doing, people would love us. But we don’t have to look at our core business practices, and we don’t have to embed these large social issues into our core business.’ What gave me faith and hope was that Walmart recognized that being a better business was the key to all that, and it was willing to look into its business practices, it was willing to improve its health care, it was willing to become a more sustainable company, it was willing to look at how to improve the inclusion of women in the supply chain. When you couple that with the size and scale of the business — the ability to make a difference along with the intent — to me, that was powerful.
I also came from many years in Washington, working on issues politics and electoral politics. And Washington was a frustrating place; there wasn’t a clear path to getting much done and that hasn’t changed, of course. One advantage when you have a business with global scale, serving the right customer and also intent on doing some things, is that you have a lot of ability and you have fewer obstacles.
HuffPost: Can you talk a bit about your specific agenda at Walmart, from sustainability and sustainable agriculture to nutrition and women’s economic empowerment?
Dach: We’ve been the first company to cross-donate a billion meals with Feeding America. We’ve got a $2 billion commitment to help end hunger in the U.S. We’ve become the number one generator of on-site solar energy in the U.S. — last week we flipped a switch in Ohio and we added 10 percent to Ohio’s solar capacity. We’ve been able to work with [first lady] Michelle Obama on issues like reformulating our food supply and making healthy food more affordable. We recently said we’re committed to offering a job to any honorably discharged veteran within a year of their discharge who wants to work at Walmart. To be able to see a path to taking these issues to scale, that’s a tremendous opportunity if you’re a person like me and you care about driving those issues forward.
One of the things that has become apparent in the impact world, is that no one can go it alone. That governments, businesses, civil society, can’t go it alone to make a difference. I think people have come to the realization that if you want to solve these problems you have to work together, and I don’t think that was as true a few years ago. People had more faith in government than they have today and there was more tension between civil society and the business world. I think that reality has softened those tensions and those boundaries.
This is not a knock-it-all on government, but governments can’t create sustainable, private-sector economies. They can help them, but in the end these businesses have to take that on. To me, the emergence of these large-scale partnerships is a very important way to do the world’s business. I hope people see Walmart as being not only an early adopter, but a major participant and driver, as well.
HuffPost: When you were instituting changes regarding things like philanthropy or energy conservation, did you face much internal resistance or opposition? If you did, how did you manage it?
Dach: I think what we discovered is there was a lot of work we needed to do. In order to do something like buying $20 billion worth of goods from women-owned businesses, there’s a lot you need to do inside a business to make that happen. We’ve had a model of standing up and saying we’re gonna come up with these large goals that we frankly don’t know how to achieve. We can see about 70 percent of it but we don’t know how to get to the last 30 percent of it. [Hiring] veterans is an example. When we announced that, we didn’t quite know how we were going to do it, we didn’t have all the systems in place, but we believed we could.
When I first started, the tension between civil society and business ran in both directions. It wasn’t easy for Walmart to open itself up and have meetings with people who were critical of the company or with newspapers on a regular basis. So we took a bit of a leap of faith — my reputation and others’ were on the line when we said, “Look, having these meetings may be difficult the first time around but they will create these partnerships and we will learn from each other.” I think that was harder at first but now it’s something we’ve learned to do. I think that’s all part, over time, of getting a business to change and a business to incorporate these impact issues into the business model in a sustainable, meaningful way.
HuffPost: How do you address basic, foundational challenges or criticisms of a company — like, for example, the argument that large, chain retailers like Walmart hinder small business growth and push out mom-and-pop stores?
Dach: We’ve had many positive experiences around the country as well as internationally where small businesses are thriving next to Walmart. We bring traffic to our store that also stops at other stores. We understand that it’s an often-debated issue and there are a lot of great examples out there. There are a lot of neighbors, a lot of stories of people that were skeptical on the way in, but are comfortable or believers once the store is in there. The stores are often very controversial, but once it’s open, it becomes just “the store.” It happens to be a store that people like to shop in, but instead of a piece of politics it becomes just a store.
At the same time, we knew we had to be a better neighbor, we weren’t as good a neighbor as we could be. We went into communities and tried to build a store without being as open as we should have, without being willing to change the store to meet the community needs. So we’ve also had to learn to be a better neighbor.
HuffPost: In these turbulent economic times, how does social impact fit into Fortune 500 philosophies? How important is social good and the “triple bottom line”?
Dach: I believe that every company has the ability to and should be doing these things, because it makes you a stronger business. It can start off by reducing costs in many ways. We used to pay somebody to take our trash away, now more than 80 percent of our trash doesn’t go to a landfill any more, it’s recycling revenue. The work we’re doing in renewables and conservation reduces our costs, so it’s good for business once you get your mindset into the opportunity. It’s of course good for your relationships with communities and elected officials and it makes the people who work for you prouder to work for you.
The other thing we’ve tried to do, we’ve crossed a billion dollars in giving cash and in kind, that’s a huge amount of money, it makes a real difference in people’s lives. But I think that the bigger difference we make is through what we do in the business. So if you look at hunger, we’ve pledged $250 million in cash support to food banks, school breakfast for over five years. But we’ve also given away over a billion meals, through the business, and so it’s really that combination of what philanthropy and the business itself can do.
HuffPost: Where does Walmart go from here and what lessons can we learn about how giant corporations can incorporate social good into their business plans?
Dach: It goes exactly down the same path, because we’ve really tried to institutionalize these things and we’ve got a lot of people working on them every day, and we’ve made a lot of big public commitments that we’re on the hook for. I like to say that we’ve made sustainability and these other issues in Walmart, we’ve created our own virtuous loop about them. So I’m confident. We all like to believe that we’re essential, but I’ve learned that none of us really are, so it’s my hope and belief that it will continue.
The people that buy the product, the people who run the stores are into this. That’s the key for anybody who wants to do this. It can’t be driven by ‘corporate,’ it needs to be adopted, believed in and felt by the people who are out on the front lines of whatever business you’re in.
This interview has been edited and condensed for clarity.