New York City Comptroller John Liu’s office announced on Tuesday that the city’s pension fund will vote against five Wal-Mart’s directors at the annual shareholder’s meeting next month. The move comes in the wake of reports that Wal-Mart officials allegedly sought to cover up hi-level bribery in the company’s Mexico division in the middle of the last decade. The city’s pension funds hold nearly $278 million worth of Wal-Mart stock.
“Wal-Mart presents itself as a leader in corporate ethics, but it is clear that the company’s leadership does not practice what it preaches,” Liu said in a statement. “The bribery allegations are damaging, but reports of a widespread cover-up, involving Wal-Mart’s top executives, could have even more devastating consequences.”
The Comptroller’s office says efforts were made in 2005 under the previous comptroller, Bill Thompson, to get “Wal-Mart’s audit committee retain independent counsel to conduct a comprehensive review of Wal-Mart’s legal and regulatory controls and issue a report to shareowners with findings and recommendations.”
“Time and again our Pension Funds have approached Wal-Mart’s board with serious concerns about its practices in the U.S. and abroad and received only empty reassurances,” Liu said. “This board has failed its shareholders.”
A spokesperson for Wal-Mart said the company is not commenting on the news.
The Comptroller’s office said it would specifically vote against Michael T. Duke, chairman and CEO of Wal-Mart Stores, Inc.; H. Lee Scott, Jr., the former CEO; Christopher J. Williams, chairman and CEO of The Williams Capital Group, L.P. and Williams Capital Management, LLC.
“Directors Duke and Scott failed to act in shareowners’ best interests when confronted with credible allegations of widespread bribery, while Mr. Williams bears responsibility for the audit committee’s failure to ensure adequate internal compliance controls, notwithstanding repeated shareowner concerns,” the comptroller’s office said.
Additionally, the pension fund will vote against the current audit committee director Arne M. Sorenson, as well as the Chairman of the Board, S. Robson Walton.
The city pension fund holds more than 4.7 million shares in Wal-Mart.