We’re well into spring and heading smack into summer, so ‘tis the season for outdoor barbecues, school commencements and, hold onto your beach towels, annual shareholders meetings.
The discount giant Walmart will hold its annual meeting on June 1. The company expects 14,000 to attend – including 5,000 employees, chosen by their colleagues, flown in from stores around the world, all expenses paid.
It’s quite a party. The extravaganza, which in the past has featured entertainment by Will Smith and the Black Eyed Peas, among others, will be held at the University of Arkansas’ Bud Walton Arena in Fayetteville, named after the co-founder of the now megalithic chain stores. He contributed half of the building’s $30 million construction cost.
This year’s meeting is an especially big deal because it’s the company’s 50th anniversary and the company’s stock is at a ten-year high (you can watch the proceedings live, if that’s your idea of a springtime fun, via the Walmart website. But the celebrations may be a bit subdued as the Justice Department, Securities and Exchange Commission and the Mexican government continue investigating allegations of corporate corruption. According to the Reuters news service:
“Wal-Mart was bombarded by negative comments from shareholders and activists after the New York Times reported in April that management at Wal-Mart de Mexico, or Walmex, allegedly orchestrated bribes of $24 million to help it grow quickly last decade and that Wal-Mart’s top brass tried to cover it up…
“There is growing dissension among some shareholders who believe that current board members, including Chairman Robson ‘Rob’ Walton, CEO Mike Duke and former CEO Lee Scott, knew of the issue and should have taken corrective actions years ago.”
Stockholders include the two largest public pension funds in the country, the California Public Employees’ Retirement System and the California State Teachers’ Retirement System, as well as the New York City Pension Funds and Florida’s State Board of Administration, all of which have expressed their opposition to reelecting Walmart board members. Other groups, including OUR Walmart, an organization of current and former employees, take issue with the chain’s wages, working conditions, and aggressive opposition to unions.
But there’s another item on the agenda, a reaction to the Supreme Court’s Citizens United decision that’s been a hot ticket at stockholders meetings across the country: a vote on whether Walmart should be forced to reveal its political contributions. According to the Chicago Tribune:
“Investors filed more than 100 resolutions this year asking companies to disclose what they spend on political advocacy, according to Institutional Shareholder Services, a proxy advisory service. The number of proposals for the first time exceeded shareholder resolutions on energy and environmental issues, which have long attracted significant interest from investors.
“Shareholders want to know about direct donations to candidates as well as harder-to-track contributions to trade associations such as the U.S. Chamber of Commerce and other tax-exempt groups that support certain candidates or political parties.”
The Tribune cites a 2010 study that found that “86 percent of the Standard & Poor’s 500 companies have no disclosed policies regarding money given to trade associations or other groups not controlled by a candidate, so-called indirect political expenditures that have become highly controversial during the 2012 campaign season.”
Nell Minow, described by The Washington Post as “a longtime corporate governance consultant who supports the push for transparency” told the paper:
“We really have no idea how much is being spent and where it’s being spent. This is the defining issue of our time — the way that money and politics combine. If we don’t want the United States government to become a wholly owned subsidiary of corporate America, we need to do something about it.”
The non-partisan Center for Political Accountability reports that 101 companies have agreed to disclose at least some of their political spending but the resistance of big business remains strong. The Post reports that none of the stockholder proposals for greater transparency have passed “though some have received votes exceeding 35 percent, a high number compared with most shareholder resolutions.” The result at Walmart, where the Walton family owns half of the 3.4 billion shares and deep-pocketed financial institutions are the next largest shareholders, is also expected to be a thumbs down:
“But passing the measures is not necessarily the point, advocates say. The main goal is to pressure companies to increase their disclosures, especially with the lack of action on Capitol Hill and within federal agencies.”
One glimmer of hope, Walmart shoppers: the company’s fifth largest shareholder is Warren Buffett’s Berkshire Hathaway. At his annual meeting three weeks ago, Buffett declared, “I think the whole idea of Super PACs is wrong. The idea that I should toss $10 million into some Super PAC that will spend its time misleading people about its opponent — I don’t want to see democracy going in that direction.”
Berkshire Hathaway owns less than 1.5 percent of Walmart, but maybe some of Buffett’s common sense will rub off.