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 the dissent 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 re-election of Duke to the company's board. That compares with 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 on the audit committee. That's a little less than the 13.2 percent a year ago.
With descendants of Wal-Mart's founder owning about 50 percent of Wal-Mart's shares, activist shareholders had little chance of voting out the board members. But the numbers show a loss of faith, particularly when Walton family members and other insiders are excluded.
The official voting results for each of these proposals 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.
"The last two years have been unlike any election in the company's history," Garland said.
The New York Times first reported in April 2012 that Wal-Mart failed to notify law enforcement that company officials authorized millions of dollars in bribes in Mexico to speed up getting building permits and gain other favors. Since then, Wal-Mart has been working with government officials in the U.S. and Mexico on that investigation.
The company also has said it's been investing in fortifying controls overseas and has hired new executives to oversee its efforts to comply with laws against foreign bribes. Starting this year, the company is also tying some of its executives' compensation to how successful the company is overhauling its compliance division.
Separately, Wal-Mart has been working on improving clothing factories it does business with in Bangladesh following the building collapse there. Wal-Mart said last month that it will conduct in-depth inspections at all 279 factories it uses in Bangladesh and will make the inspection information public. It also is joining a group of U.S. retailers and U.S. trade retail and apparel groups to improve fire and safety regulations in garment factories.
But for some investors, those efforts have not been enough. The New York City Pension Funds said it voted against nine of Wal-Mart's 14 board nominees at the retailer's annual shareholder meeting Friday.
City Comptroller John Liu's office oversees the fund. He said last week the fund is concerned with the board's failure to comply with laws and its own policies. The fund owns 5.1 million shares, or less than 1 percent, of the world's largest retailer.