Walmart FY2026 ESG Report: Scale, Steady Progress and the Scope 3 Problem

Walmart's latest ESG report shows a retailer that is improving its operational footprint but still struggling to bend its total emissions curve.

The company's FY2026 report reveals modest year-on-year reductions in absolute emissions and stronger progress on carbon intensity, yet total emissions remain dominated by Scope 3, which accounts for over 97% of the footprint.

For anyone tracking ESG data in retail, Walmart is the clearest example of what "good operations, hard upstream" looks like at global scale.

What Walmart's FY2026 report covers

Walmart's FY2026 ESG and sustainability disclosures focus on four shared value pillars: opportunity, sustainability, community, and ethics and integrity.

The company's climate strategy is built around:

• Decarbonising its own operations (Scope 1 and 2) by 2040.

• Engaging suppliers through Project Gigaton, which aims to avoid or reduce 1 billion metric tonnes of GHG emissions in global value chains by 2030.

• Improving energy efficiency, scaling renewable electricity, and reducing waste in operations.

In our analysis, we processed Walmart's 141-page ESG report in under five minutes and extracted verified metrics across FY26, FY25 and prior years, enabling clearer year-on-year comparison than a single headline figure.

Key performance highlights

1. Earthmark score: above sector median, but not best-in-class

Against sector peers, Walmart scores 2.5 out of 5.0 on Earthmark, well above the Consumer Staples sector median of 0.9, but below leaders like Target at 3.5.

In the broader retail and consumer staples set (2,788 companies):

• Walmart: 2.5 / 5.0

• Sector median: 0.9 / 5.0

• Sector maximum: 4.7 / 5.0

Walmart's score is anchored by strong governance disclosure and operational emissions management, with environmental data availability around two-thirds of core indicators.

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2. Modest absolute emissions reduction, stronger intensity improvement

Walmart's latest disclosures show:

• Total emissions: 649.4 million tCO2e, down from 652.21 million tCO2e year-on-year, a reduction of 0.43%.

• Scope 1 emissions: 8.16 million tCO2e, down 9.6% YoY.

• Scope 2 (market-based): 6.24 million tCO2e, down 5.6% YoY.

• Scope 3 emissions: 635.0 million tCO2e, down just 0.25% YoY, but still making up over 97% of total emissions.

On carbon intensity:

• Carbon intensity improved 4.9% YoY, from 957.75 tCO2e per $1M revenue to 910.59 tCO2e per $1M revenue.

This indicates that Walmart is decoupling growth from emissions: revenue increased while absolute emissions fell slightly and intensity improved more meaningfully.

3. Waste disclosure gap

A notable gap in the latest update is waste reporting. Previous disclosures tracked total waste volumes and recycling versus disposal splits, but these metrics were omitted in the most recent filing.

For benchmarking purposes, this reduces comparability year-on-year and weakens confidence in progress narratives around operational waste.

4. SBTi target changes

Walmart's target profile has also shifted:

• The company's long-term net-zero commitment has been removed from the SBTi dashboard.

• Its near-term 1.5°C-aligned target remains active, with a newly updated baseline for FY25 and a focus on Scope 1 and 2 reductions through FY2031.

This does not erase prior progress, but it does raise the bar for external verification and clarity on long-term ambition.

The Scope 3 challenge

Despite operational progress, Walmart's total emissions remain overwhelmingly driven by Scope 3. The company's own disclosures and third-party analyses confirm that:

• Scope 3 accounts for over 97% of total emissions, with purchased goods and services and use of sold products the largest categories.

• From 2019 to 2021, upstream Scope 3 emissions rose around 29%, contributing to a 21% increase in total GHG footprint over that period.corporate.

• In FY2026, Scope 3 increased slightly, driven by business growth and changes in product mix, even as intensity improved.

Why did Scope 3 rise?

Three main factors explain the dynamics:

1. Revenue and volume growth
   Walmart's top line continued to grow, with revenue increasing from around $681bn to $713bn in the period covered by your dataset. More sales of groceries, general merchandise and other categories directly increase upstream manufacturing and agricultural emissions.

2. Product mix shifts
   Changes in assortment, including more emissions-intensive categories, can push up estimated Scope 3 even if operational efficiency improves.

3. Supply chain complexity
   Walmart's global supplier base and diverse product portfolio mean that even small efficiency gains per unit can be offset by volume growth and mix changes.

The net effect: Walmart is improving efficiency and reducing operational emissions, but growth in product volumes and mix changes are still constraining total footprint reductions.

Competitive context: Walmart vs Target, Costco and Amazon

When placed alongside key peers, Walmart's profile is distinctive:

Total emissions

• Walmart: 649.40 million tCO2e

• Costco: 182.20 million tCO2e

• Target: 115.73 million tCO2e

• Amazon: 80.85 million tCO2e

Carbon intensity (tCO2e per $1M revenue)

• Amazon: 112.77 (lowest, helped by AWS revenue mix)

• Costco: 675.06

• Walmart: 910.59

• Target: 1,085.97 (highest, driven by expanded Scope 3 boundaries)

Earthmark scores

• Target: 3.5 / 5.0

• Walmart: 2.5 / 5.0

• Amazon: 1.9 / 5.0

• Costco: 1.1 / 5.0

On current operational metrics, Walmart sits between best-in-class peers like Target and lower-scoring competitors like Costco and Amazon. Its absolute footprint is by far the largest, but its intensity is better than Target's and improving year-on-year.

What Walmart needs to do next

The company's own reporting and external analysis point to three strategic levers:

1. Deepen supplier decarbonisation (Category 1)

Purchased Goods and Services is the largest single source of emissions. Walmart can:

• Expand Project Gigaton engagement to cover more suppliers and more ambitious targets.corporate.

• Require top OEM and agricultural suppliers to adopt SBTi-aligned targets and transition to 100% renewable power in manufacturing and farming operations.

• Embed carbon intensity and deforestation-risk criteria into sourcing decisions, not just cost and service levels.

This is where the biggest absolute reductions must come from.

2. Strengthen waste and circularity reporting

Walmart previously set goals around zero waste in key markets and recyclable packaging for private brands. The next step is to:

• Restore consistent, granular waste disclosure (total tonnes, recycling vs disposal, by region).

• Scale circular economy initiatives such as packaging reduction, product take-back and refurbishment where relevant.

• Link waste metrics to operational incentives and supplier requirements.

Transparent waste data is essential for credible benchmarking.

3. Clarify long-term climate ambition

With the long-term net-zero commitment no longer visible on the SBTi dashboard, Walmart has an opportunity to:

• Reaffirm or refine its 2040 zero-emissions goal with clear interim milestones beyond FY2031.

• Explain how Scope 3 reductions will be achieved in practice, not just through supplier engagement but via measurable category-level targets.

• Align public messaging with disclosed data to avoid perceptions of ambition drift.

Clarity here will matter as much as the numbers themselves.

Why this matters for ESG data and benchmarking

Walmart's story illustrates a broader point about ESG reporting in retail:

• Operational metrics can look excellent while total emissions barely move.

• Scope 3 dominates, so any meaningful climate strategy must focus on suppliers, product design and agricultural systems.

• Comparability is hard: reporting boundaries, methodologies and product mixes differ across retailers and over time.

This is where automated benchmarking becomes valuable. By processing reports like Walmart's in minutes and standardising data across peers, platforms like Earthmark help investors, brands and shoppers see beyond headlines to the underlying drivers of performance.

The bottom line

Walmart's FY2026 report shows a retailer that is:

• Above sector average on Earthmark score, governance and operational emissions management.

• Delivering steady improvements on Scope 1 and 2 reductions and carbon intensity.

• Still exposed to Scope 3, where growth in product volumes and mix changes currently outweigh efficiency gains.

The strategic question for Walmart — and for the sector — is how quickly it can turn supplier engagement, product efficiency and circular initiatives into a downward bend in total emissions, not just a flattening of intensity.

If you're tracking sustainability performance in global retail, Walmart remains one of the clearest examples of what "good operations, hard upstream" looks like at scale.

Sources & data: Walmart FY2026 ESG and sustainability disclosures, Project Gigaton updates, SBTi target information, and third-party emissions datasets; competitor data from public sustainability reports and Earthmark benchmarking. See Walmart's Earthmark page for more information. Search any brand on Earthmark's Brand Directory.