Walmart Withdraws from ALEC, Wallows in Bribery Scandal

Mike Duke photoIn an unsurprising, capitulatory move last week, Walmart joined several other major companies and withdrew its membership from the American Legislative Exchange Council, which advances the principles of free markets and limited government at the state level through legislative idea exchanges.

The move preceded Friday’s annual shareholder meeting, in which executives emphasized their commitment to principles of integrity. That came into question especially since April, when the New York Times revealed that company officials authorized millions of dollars in bribes in order to expedite building permits and other favors in Mexico.

A number of investors and pension funds attempted to remove some Walmart directors from the board, including CEO Mike Duke (in picture), former CEO Lee Scott, and S. Robson “Rob” Walton, son of company founder Sam Walton. Because the family holds nearly 50 percent of stock in the company, proposals they don’t support will always …

Will SEC’s ‘Say on Pay’ Rule Do Any Good?

golden parachuteAs someone who has sponsored “Say on Pay” shareholder proposals with companies like Boeing and Procter & Gamble, I wonder whether SEC-mandated votes on executive compensation will do any good. In fact, I worry that it may lead to a false sense of shareholder empowerment.

Yesterday, the Securities and Exchange Commission voted 3-2 to adopt a rule requiring public companies to hold an advisory vote on executive pay at least once every three years.

At Boeing in 2008, our “Say on Pay” proposal got 38% of the vote, an extremely strong vote for a proposal opposed by the company’s management.  It had little impact. Management paid no attention to us and Boeing CEO James McNerney continues to be overpaid, even as the company experiences setback after setback.

Public companies should be controlled by shareholders, and their representatives, the board of directors. Unfortunately, corporate boards today are characterized by cronyism and …