At Walmart’s annual shareholders meeting on June 1, the retail giant’s leadership was put on notice that it’s time for a change when an unprecedented number of shareholders voted “no” on the re-election of four leading board members and “yes” for a worker-shareholder sponsored proposal to make executive compensation more transparent.
Members of Organization United for Respect at Walmart (OUR Walmart) organized a shareholder campaign that played an important role in what turned out to be a stinging rebuke of the company’s leadership. The campaign included a nationwide get-out-the-vote effort aimed at mobilizing worker and shareholder discontent.
The shareholder campaign was part of a long-range campaign to win a united, on-the-job voice for Walmart workers and to make changes at the retail giant that will end its race-to-the-bottom corporate culture.
OUR was joined in this effort by Making Change at Walmart, a community-labor coalition, both of which are affiliated with the United Food and Commercial Workers.
The shareholders campaign was built around two issues: dumping four board members who demonstrated a profound lack leadership during a bribery scandal involving government officials in Mexico and supporting a worker-shareholder sponsored resolution, known as proposal #6, to make executive compensation more transparent.
Between 12 percent and 15 percent voted “no” on the re-election of board members H. Lee Scott, Jr., former Walmart CEO, who served during the bribery scandal, Michael Duke, the current CEO, Rob Walton, an heir to the Walmart fortune, and Christopher J. Williams, who chaired the audit committee during the bribery scandal.
Charles Elson, a corporate governance expert, told the New York Times that the “no” vote, which was up from previous highs of about 2 percent to 3 percent, was “very significant.”
The Walton family and top executives own more than 50 percent of Walmart’s stock; therefore, a “no” vote didn’t have a chance to win a majority. But 38 percent of non-family, non-executive shareholders voted “no,” a significant minority, who according to Elson, may be less willing to provide future capital to Walmart unless changes are made.
Some important institutional investors voted “no” including the New York City pension fund, the California Public Employees Retirement System, the California State Teachers Retirement System, and the Texas Public Pension Review Board.
Proposal #6 received 9.3 percent of the vote. “The employee-shareholders who introduced proposal #6 on executive compensation should be very proud today,” said John Marshall, senior capital markets analyst with the United Food and Commercial Workers. “To receive nearly 10% of the vote in the first year a proposal is on the ballot is an excellent result, and over three times the resubmission threshold required to re-file the proposal next year.”
According to Carlton Smith, a Walmart associate who was one of proposal #6 four sponsors, the proposal was a first step toward ending a double standard at Walmart.
“The three associates and I who introduced proposal #6 did so because it is time to rein in the double standard that this company practices,” Smith said. “Executives get bonuses no matter how poorly the company performs. We can make Walmart better for workers, shareholders and the community and we will continue to call for change of company policies that hurt all of us, including understaffing, unpredictable schedules, and health insurance plans that cover too little and cost too much.”
Proposal #6 received 22.7 percent of non-Walton family, non-executive shareholder votes.
Prior to the shareholder meeting, OUR members contacted other Walmart employee-shareholders and urged them to vote against the four board members and to for proposal #6. They made phone calls, mailed information about the issues, and used social media to get their message out.
Leading up to the shareholders meeting, OUR members held proxy parties where they could talk freely with other Walmart workers about the two shareholder ballot issues, vote their proxies, and mail their votes together.
They also used the shareholders campaign as an organizing tool to get more Walmart associates to join OUR, which has members all over the US.
The fight to make change at Walmart is a fight that affects the wider working class. According to a recent report released by the National Employment Law Project, Walmart drives down wages for workers in its international supply chain. More about this later.