Shareholders to vote against Wal-Mart’s board
HOST: Today Wal-Mart celebrates it’s 50th anniversary. At the same time, Wal-Mart shareholders are gathering in Bentonville, Arkansas today for the company’s annual meeting. Wal-Mart’s board of directors is likely to take heat for big pay packages for company executives and a Mexican bribery scandal.
Marketplace’s Jeff Tyler reports.
Jeff Tyler: Wal-Mart employees gathered at a Shakey’s pizza parlor near Los Angeles last week. Venanzi Luna asked her co-workers to vote for a proposal that would change the way CEO Mike Duke gets paid.
Venanzi Luna: We need to show Mike Duke who’s boss. And it’s not fair that he makes $3,000 an hour, and we get paid minimum wage.
She’s one of the employee-shareholders behind a proposal to curb executive pay. Luna and her colleague, Carlton Smith, came here to get out the vote.
Carlton Smith: Proposition number six is cut and dry. You guys need to take a look at the way these executives are receiving their bonuses.
Smith owns four shares of Wal-Mart. Not a lot, but enough for him to attend today’s meeting and press his case.
John C. Liu, on the other hand, oversees 5.5 million shares of Wal-Mart. Liu is New York City’s comptroller, and trustee for the city’s pension funds. He wants to shake up Walmart’s board of directors.
John C. Liu: We will vote ‘No’ against the re-election of five of these directors.
Wal-Mart is under investigation for an alleged Mexican bribery scheme and cover-up. Comptroller Liu says his office asked Wal-Mart to step-up corporate oversight years ago.
Liu: When there are clear indications that the highest levels of Wal-Mart management had been involved in quashing internal investigations, that becomes a threat with regard to the value of our shares.
Wal-Mart declined to comment for this story. But analysts point out that the company’s finances are healthy, and its stock price is near a 10-year high. And even though several institutional investors plan to vote against Wal-Mart’s board today, the executives are unlikely to lose their jobs.
Comptroller Liu explains.
Liu: There are no delusions that we’ll have a majority vote. It’s essentially mathematically impossible.
That’s because the Walton family controls almost half the company’s shares. So the vote against board members is mostly symbolic. But even if no action is taken, Wal-Mart will get the message.
I’m Jeff Tyler for Marketplace.
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