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Wal-Mart's proxy vote shows dissent against execs

Published on NewsOK Modified: June 10, 2013 at 5:10 pm •  Published: June 10, 2013
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NEW YORK (AP) — Wal-Mart's final shareholder vote for its board of directors showed another year of dissent against key executives and directors, including its CEO Mike Duke, as the company deals with the fallout from overseas bribery allegations.

All of the 14 company's nominees were re-elected at the annual shareholders' meeting Friday, but with significant numbers of dissenting votes. Such dissatisfaction against leaders shows how the company continues to be distracted by concerns about its handling of bribery allegations that surfaced last year at its Mexican unit.

The company, based in Bentonville, Ark., also is being pressured to increase its oversight of factories abroad following a building collapse in April in Bangladesh that killed more than 1,100 garment workers. Wal-Mart wasn't using any of the factories in the building at the time of the collapse, but it is the second-largest retail buyer of clothing in Bangladesh.

According to results released by Wal-Mart Stores Inc. Monday, 12.1 percent of the 3.29 billion shares were voted against the re-election of Duke to the company's board, though it's a little less than the 13.1 percent last year. Ten percent went against Chairman Robson Walton, the son of founder Sam Walton. That compares with 12.6 percent a year ago. A little over 8 percent of the votes were cast against former CEO Lee Scott, compared with 15.6 percent last year.

A little over 12 percent of the shares were cast against Christopher Williams, chairman and CEO of The Williams Capital Group, who serves as chairman of the audit committee. That's a little less than the 13.2 percent a year ago.

"We're pleased that our shareholders have overwhelmingly elected all 14 of our nominees to the company's board," said Randy Hargrove, a Wal-Mart spokesman, in a statement. "This included support from a significant majority of unaffiliated shareholders, and increased support versus last year for Mr. Duke, Mr. Walton, Mr. Williams and Mr. Scott. Our shareholders have reaffirmed their confidence in the board's leadership, strong governance principles and diversity of experience."

With descendants of Wal-Mart's founder owning more than 50 percent of Wal-Mart's shares, activist shareholders had little chance of voting out the board members. But corporate governance experts say the numbers show a loss of faith, particularly when the votes of Walton family members and other insiders are excluded.

The official voting results will be disclosed in a report filed with the Securities and Exchange Commission later this week. But based on estimates, about 30 percent of the shares not controlled by the Walton family were voted against both Duke and Williams, according to an analysis by Michael Garland, who represents the New York City Comptroller's Office, which oversees pension funds of New York City workers. He estimates that 25 percent of the votes were against Robson Walton, and 21 percent were against Scott.

Two years ago, Wal-Mart's board received an average of 98.4 percent support. Historically, the company's board has received around that same level, with a few exceptions that didn't involve key company executives, Garland says.

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