New Orleans It still doesn’t mean that Walmart won’t walk away scot-free from its $24 million Mexican bribery scandal (and who knows how much more might have been spent in other countries like India?), but at least some directors may lose their soft perches and have their hands pried loose from the rubberstamps they have been holding for CEOs and others gone wild and rogue, given news that the California State Teachers’ Retirement System has sued in behalf of the company itself against the directors. CalSTRS is one of the USA’s largest pension funds and owns a whooping $313 million in Walmart shares, which is nothing to sniff about.
These so-called “derivative” suits are often dog piles with other folks, big and small jumping in. Hopefully, this means CalPERS, the other gargantuan state workers pension fund will be close behind along with other state funds that have large stakes in Walmart. The business press has noted how rare it is for funds this size not to simply negotiate directly, and argue they must be mad as wet hens. Damn, I hope so, because I certainly am.
The corporate culture over there has been bad, and now we are finding out how evil they really rolled. We still have no indication that the “investigation” of their business practices goes past Mexico, but it needs to be company-wide. At the same time Lee Scott was presiding over the company and allowing Eduardo Castro-Wright to run a criminal enterprise in Latin America, Michael Duke, the current CEO, was heading the whole international operations and flying in and out of India and China on a regular and routine basis in 2005 trying to break the opposition to modifying foreign direct investment in India and expand radically in China.
We now know that corruption at top government levels in both countries was epidemic. Bribes of almost a billion dollars were paid to get cheap access to telecom licenses in India. China is now in the middle of a huge political struggle that revolves around financial corruption and self-enrichment of top party and governmental officials and their families which is shaking the very foundations of the government.
Walmart’s communication spin since the Mexican bribes were surfaced by the Times has been essentially, “that’s the way they do business there.” Someone please convince me that they are not laying the groundwork for the same “defense” in India and China, where, truth to tell, bribery and corruption are not also commonplace, as they are in much of the world. To me this proves the corporate culture and expansion program is founded on bribery and corruption. It is not other countries that are corrupting Walmart, but Walmart that is embracing the worst and most destructive practices if finds there. Where a sewer runs, Walmart swims in splashing!
I’m taking bets that Walmart is as dirty, if not dirtier, in India and China. Government officials in both countries need to start looking hard there. ACORN International’s India FDI Watch Campaign will be calling on our parliamentary allies in India to launch such investigations there. Shareholders, pension funds, and reporters here in the USA need to also join the call for more intensive, outside investigations of Walmart’s corrupt corporate culture and international operations immediately.