Costco and BJ’s are retailers that thrive on a members-only model. These two companies are marketed to consumers as great places to find bargains on all kinds of goods, particularly items sold in bulk. Wholesale clubs offer attractive prices to consumers whether there are big or small scale traders. Their prices are low, and clients are supposed to pay membership fees that are paid annually.
Deciding which membership-only warehouse club chain to support can be a tough decision, so we’ve tried to break down both chains and what your purchase will support.
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At Ethically, we compile scores from over 700 verified sources to create a granular profile of more than 10,000 companies and brands, evaluating their impact on the environment, society at large, and good business. You can learn more about Ethically’s process in our Methodology and you can see the scores yourself by downloading the Ethically browser extension.
BJ’s Wholesale Club Holdings, Inc., commonly referred as BJ’s, is an American membership-only warehouse club chain based in Westborough, Massachusetts, operating on the East Coast of the United States in addition to Ohio and Michigan.
Costco Wholesale Corporation is an American multinational corporation which operates a chain of membership-only big-box retail stores. As of 2020, Costco was the fifth largest retailer in the world, and the world’s largest retailer of choice and prime beef, organic foods, rotisserie chicken, and wine as of 2016. In 2021, Costco was ranked #10 on the Fortune 500 rankings of the largest United States corporations by total revenue.
These two companies are very close when it comes to their ESG measurements. There are few slight differences that make one company’s score a tad higher than the other.
Overall, BJ’s Wholesale scored a 48/100 and Costco scored a 50/100. Costco’s score advantage over BJ’s Wholesale is highlighted in the three score categories but is especially significant in the environment category.
Let’s dive in (Reminder, check out our Methodology for definitions on each of these subtopic scores)
Impact on the environment
Impact on the environment relates to how a company or brand impacts the natural world around us. This could be related to the products they create, their manufacturing policies, or even their corporate response to climate change. BJ’s Wholesale and Costco both impact the environment in a number of ways, from their manufacturing policies to the products they produce. Below are more details comparing these two companies.
Costco significantly beats BJ’s Wholesale in this category, with the scores being 62 to 52. This category has to do with the companies’ compliance with environmental regulations, energy efficient operations and development of renewable energy and alternative environmental technologies.
Double clicking on that score difference, Costco scored a 67/100 in Energy & Climate Change, a 55/100 in Environment Policy & Reporting and a 64/100 in Resource Management. On the other hand, BJ’s Wholesale scored a 58/100 in Energy & Climate Change, a 44/100 in Environment Policy & Reporting and a 54/100 in Resource Management.
Impact on social responsibility
Social responsibility includes all the things that make a company “good”. Whether that’s giving back to the community, standing up for equal rights, treating workers fairly. BJ’s Wholesale and Costco both have a number of policies around LGBTQ+ rights, community outreach, and equal pay and rights for all.
Another slight distinction can be noted within the Social Responsibility category, where BJ’s Wholesale scores a 50/100 and Costco scores a 48/100.This category includes all programs, policies and performance in diversity, labor relations and labor rights. It also focuses on compensation and benefits as well as employee safety.
The major differences were the respective companies’ Diversity and Labor rights rankings BJ’s Wholesale: 53 vs. Costco: 47, Training, Health & Safety rankings BJ’s Wholesale: 49 vs. Costco: 50 and Compensation with BJ’s Wholesale: 47 vs. Costco: 48 score.
Quality of corporate governance
Corporate governance is much like social responsibility, but for how the company operates internally. Do they have a diverse board? Is there transparency in accounting? Are they doing what they need to do to survive and operate in an ethical and correct manner? BJ’s Wholesale and Costco both are large public companies with shareholders and boards they answer to.
Costco has a one point advantage over BJ’s Wholesale, with the Governance score being 50 to 49. The Governance score refers to leadership structure and the values that determine corporate direction, ethics and performance.
Upon further analysis, Costco pulls away from BJ’s Wholesale in the rankings of Board (52 vs 49) and in Transparency & Reporting (50 vs 45). In Leadership Ethics, BJ’s Wholesale has the higher score (52 vs 48).
Ethically partners with CSRHub as a primary data source, which in turn, aggregates over 700 data sources, compiling them into simple, easy to digest grades.
BJ’s Wholesale and Costco are two of the biggest warehouse chains in the U.S. that offer a variety of bulk products and services. Customers who pay annual membership fees should consider reviewing these companies’ policies and stances on the areas listed above.
Costco’s score is slightly higher than BJ’s Warehouse. As observed throughout the comparisons, BJ’s Wholesale lacks behind in certain areas but especially in the environment category. If you’re a BJ’s Warehouse advocate and want to see more evidence that they’re committed to these areas, email our CEO at email@example.com and let us know. We’d love to hear from you.
If you want to stay up to date on how these companies are progressing with their scores, make sure you download Ethically. We pull data regularly to make sure our scores reflect how companies are doing today, not years ago.
As always, please check out our Methodology page for more details on how we get our ratings data.