Mass. Pension Board Votes Against Seven Wal-Mart Directors
Board Members Deemed too Close to Mexican Bribery Scandal or Lacking Independence
The Massachusetts Pension Reserves Investment Management (PRIM) Board announced today that it has voted its shares of Wal-Mart against the election of seven of the company’s sixteen board members, some of whom were deemed too closely associated with an alleged bribery scandal in Mexico that recently came to light.
“These allegations detail egregious examples of corporate illegalities, and it’s critical that we as shareholders voice our strong disapproval,” said Treasurer Steven Grossman, who chairs the PRIM Board. “We need to make it clear that these kinds of corporate abuses are not acceptable, and that serious repercussions happen when problems are not appropriately addressed. Shareholders own public companies, not the other way around.”
The allegations involve bribes going to Mexican government officials from Wal-Mart executives in that country. Recent reports have suggested that some members of the company’s board of directors and senior management were complicit in regulatory and legal misconduct related to the incident. PRIM voted against all seven board members due to concerns about their independence since they are associated with Wal-Mart in capacities other than the full board, and it voted against four of them specifically because of their alleged connections to the Mexican bribery incident.
PRIM owns 923,626 shares of Wal-Mart, with an approximate value of $60 million. Grossman said that he believes that larger shareholders like the Massachusetts pension fund raising objections could fuel additional scrutiny and prompt the company to improve its corporate governance.
The Wal-Mart board members that PRIM voted against are M. Michele Burns, Michael T. Duke, Gregory B. Penner, H. Lee Scott, Jr., Jim C. Walton, S. Robson Walton, and Christopher J. Williams.