Costco Nets Extra Points for Sustainability

This article is part of our Rising Star Portfolio series.

Environmental group Greenpeace said there was something "fishy" about Costco (Nasdaq: COST  ) . Now, when it comes to seafood sustainability, the warehouse retailer has pledged to clean up its act.

Costco will no longer sell a dozen types of fish deemed unsustainably farmed by the Marine Stewardship Council, according to Fast Company. Since Costco's the largest retail fish purchaser in the U.S., this is a big win for folks worried about the environmental ramifications of commercial fishing. Moves like this from a massive, consumer-facing company like Costco can often result in tsunami-like ripple effects. Consider Wal-Mart's (NYSE: WMT  ) attempts to push for green practices, which have forced its many suppliers to pay attention to their own sustainability initiatives.

Until it made this switch, Costco consistently floated near the bottom of Greenpeace's annual fish sustainability report, "Carting Away the Oceans." After a similarly withering campaign from Greenpeace, Trader Joe's -- dubbed "Traitor Joe's" by the eco-friendly activists -- has since changed its seafood purchasing policies.

Last April, Greenpeace lauded Target (NYSE: TGT  ) for its efforts, and said Whole Foods Market (Nasdaq: WFMI  ) and Safeway (NYSE: SWY  ) had had made significant gains. In September, Whole Foods addressed marine sustainability issues with a color-coded system for stores. However, in April, Greenpeace offered scathing criticism for Costco, along with private grocers H-E-B and Meijer, accusing them of showing "absolutely zero interest" in the issue.

Apparently, Costco took notice. Its steps to fix the problem should generate greater goodwill for the business, and therefore its stock.

I chose Costco as one of my first purchases for my socially responsible Rising Star portfolio because its many wonderful attributes make it both a great business and a net positive for many stakeholders. Although I'm sure some folks would argue that Greenpeace's long-standing criticisms of Costco's fishy seafood selection have tarnished the retailer's socially responsible reputation, I'm simply glad that the retailer's furthering its shift toward environmental responsibility.

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