(June 4, 2012) — Shareholders have voted to reelect all 16 Wal-Mart Stores Inc.’s board members in opposition with stockholders, such as the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS).
Some of the largest public pension funds in the United States had called for dumping Wal-Mart’s board members because of recent furor surrounding Wal-Mart’s Mexican arm.
These shareholders called for Wal-Mart Chief Executive Mike Duke, former Wal-Mart Chief Executive Lee Scott, and Chairman Rob Walton to be removed from the board as a result of allegations of bribery at Wal-Mart’s Mexican operation. While Scott, former CEO of the world’s largest retailer, received the most votes against, with 15.65% of shares voted, according to Wal-Mart, a total of 13.1% voted against Duke, who was president of Wal-Mart International during the investigation. A total of 12.6% voted against Walton.
The attempt among pension funds to remove Wal-Mart board members had no chance of succeeding due to the fact that Walton’s family controls almost 50% of Wal-Mart’s stock. Nevertheless, the minority opposition sent a strong message to Wal-Mart’s board. As a result of the allegations, Wal-Mart is overhauling its global compliance programs and leading an investigation into its Mexican operations for possible violations of the US law that prohibits bribery in foreign countries, according to the Dow Jones Newswires.
Last month, the $228-billion CalPERS, the largest public pension fund in the US, revealed plans to withhold votes for nine Wal-Mart Stores board members following allegations that the retailing giant failed to look into bribery in Mexico. According to the fund, these board members were in a position of authority, oversight, or management of the company’s operations during the time that the alleged bribery was conducted. “In our view such an investigation should not be overseen by current members of the board that served in either a board oversight or senior management capacity at the time of the alleged bribery,” the fund stated last month.
Also in early May, the $153 billion CalSTRS filed suit against Wal-Mart officials, accusing them of using bribery and corruption to gain approval from the Mexican government to build new stores. Five New York City pension funds also said they would not support some of the Wal-Mart directors.
Institutional Shareholders Service, an influential advisory firm, had additionally suggested that institutions vote against four members of the Wal-Mart board.