Are Wal-Mart Execs Still Firefighting?
Following a turbulent year for Wal-Mart Stores (NYSE:WMT), all 14 director nominees were approved by shareholders at the company’s annual meeting on Friday; however, the increase in percent of votes cast against executives illuminates the dissent Wal-Mart key directors still face as they continue to grapple with overseas scandals.
The Bentonville, Ark.-based company released its election results Monday, elucidating that 12.1 percent of shareholders voted against Chief Executive Michael Duke, compared to 13.1 percent last year. Another 10.1 percent voted against Robson Walton, the son of founder Sam Walton, and former CEO Lee Scott faced 15.6 percent of votes cast against him.
The results expose clear dissent among shareholders over how problems overseas are being handled. The execution of the company has been under the microscope ever since allegations in 2012 charged Wal-Mart de Mexico with bribing officials for the purpose of expediting the company’s expansion. Wal-Mart has also been pressured to push safety reform in its factories abroad, especially after a building collapse in Bangladesh in April killed more then 1,100 garment workers. The company fielded criticism after it was one of the only standout retailers who refused to sign the Bangladesh Building and Fire Safety Agreement.
Wal-Mart has promised to increase efforts of securing controls overseas and hiring new executives that ensure the company’s compliance with anti-bribery laws; however, for many investors, this has not been enough. Large pensions funds and activist groups are still targeting executives, many casting votes against the majority of the company’s 14 board members, when two years ago, Wal-Mart’s board received an average of 98.4 percent support, according to the Huffington Post.
Another issue sparking controversy is over the control of Wal-Mart and how it now has officially been put into the Walton family’s hands. Shareholders had little chance of voting out these Walton family board members, but the numbers still reflect a significant amount of disillusionment and loss of faith.
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