Walmart Misses 35% Emissions Target, Sets Weaker SBTi Goal for FY2031

Walmart has set a new SBTi-approved target to reduce Scope 1 and 2 greenhouse gas emissions by 28 percent by fiscal year 2031 from a FY2025 baseline, after acknowledging it fell short of its original SBTi-approved target of a 35 percent reduction by FY2026 against a FY2016 baseline. The company achieved a 24.6 percent absolute reduction by the end of FY2026, exceeding its earlier, less ambitious 2°C-aligned SBTi target of 18 percent, but falling short of the tougher 1.5°C-aligned goal it had subsequently adopted. The revised target was developed under SBTi's five-year review protocol, which requires companies to periodically reassess and, where necessary, update their science-based targets.

 

Why the Target Revision Follows a Pattern Already Signalled

 

This announcement is not a surprise development but the formalisation of a shortfall Walmart flagged in late 2024, when the company said it was unlikely to meet its interim climate targets, citing factors it described as outside its direct control, including a lack of available low-carbon refrigeration and mobility technologies, and insufficient clean energy policy and infrastructure in the markets where it operates. That the company has now confirmed the actual shortfall and replaced the missed target with a new, SBTi-validated goal represents the structured resolution process such interim target failures are meant to follow, rather than the company abandoning science-based target commitments altogether.

Notably, the new FY2031 target of 28 percent appears less steep in annual pace than the original goal it replaces, moving from a target that required 35 percent by FY2026 to one requiring 28 percent by FY2031, a longer timeline for a smaller percentage reduction relative to a more recent baseline year. That recalibration reflects SBTi's own validation that the revised trajectory remains aligned with a 1.5°C pathway, meaning the extended timeline and adjusted baseline still meet the scientific threshold for credible climate action, even though the specific percentage and deadline have both shifted from the company's original commitment.

 

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What Drove the Year's Progress and What Held It Back

 

For FY2026 specifically, Walmart reduced absolute Scope 1 and 2 emissions by 7.5 percent and emissions intensity by 11.6 percent from the prior year, with a 20.7 percent reduction in refrigerant emissions identified as the most significant driver, achieved through reduced refrigerant leaks and adoption of lower-global-warming-potential refrigerants. Refrigerant leakage is a particularly consequential emissions source for large retailers operating extensive refrigerated grocery and cold-chain infrastructure, since many refrigerants carry global warming potential many times greater than carbon dioxide, meaning even modest leak reductions or refrigerant substitutions can meaningfully affect a retailer's total emissions footprint. Increased adoption of clean and renewable energy was cited as the year's second major driver.

Working against that progress, the company identified business growth and store network expansion, higher US transportation emissions from increased long-haul fleet miles tied to that same growth, and increased heating demand and on-site fuel usage driven by colder conditions across the US and Canada during the year. That combination illustrates a structural tension facing any large, growing retailer pursuing absolute emissions reductions: expanding operations tends to increase total energy and transportation demand even as efficiency measures reduce emissions per unit of activity, meaning genuine absolute reductions require efficiency gains to outpace growth rather than merely offset it partially.

 

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Why the Company Frames Progress as Likely to Be "Uneven"

 

Walmart's report explicitly states that while it manages the factors within its control, progress toward its longer-term goal of zero emissions across global operations by 2040 also depends on external conditions, including global energy policy and infrastructure, alongside the availability and cost of technologies such as low-global-warming-potential refrigeration and solar solutions. The company specifically flagged that low-carbon transportation technologies for long-haul freight are not expected to scale materially until the 2030s, a technology gap that directly affects the transportation emissions increase the company cited as a headwind this year.

That framing, acknowledging dependency on external technology and policy development timelines the company cannot control directly, is likely part of why Walmart described its expected progress toward the 2040 zero-emissions goal as probably "uneven year over year" rather than committing to a smooth, linear reduction trajectory. Whether the revised FY2031 target proves more durable than the original FY2026 goal it replaces, and whether the low-carbon refrigeration, solar and long-haul transportation technologies the company is depending on materialise on the timeline it anticipates, will determine whether this target revision marks a one-time recalibration or the first of several such adjustments as Walmart works toward its 2040 ambition.