Almost one-third of Wal-Mart Stores Inc.’s non-Walton-family shareholders voted against Chief Executive Officer Mike Duke and three other board members.
The vote at the June 1 annual meeting followed allegations that executives at the world’s largest retailer bribed Mexican officials and came after several pension funds vowed to oppose the re-election of some or all company directors. The founding Walton family controls about 47 percent of outstanding shares, according to data compiled by Bloomberg.
Duke was re-elected with about 87 percent of votes in favor, the Bentonville, Arkansas-based company said today in a statement. Not counting family shares, Duke got 70 percent of the votes. Former CEO Lee Scott received about 84 percent of votes in favor and Chairman Rob Walton, son of company founder Sam Walton, won about 87 percent of votes. Not counting family shares, Walton got 71 percent of the votes; Scott 64 percent.
“Given the family’s control, the amount of opposing votes is a big number,” Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware, said today in a phone interview. “If there is that much opposition, maybe they need to revisit how the board is comprised.”
Last year, Duke, Scott and Rob Walton got more than 99 percent of all votes.
Chris Williams, chairman of the board’s audit committee and responsible for oversight of the internal bribery investigation, was re-elected with 87 percent of all votes and 69 percent of non-family votes.
Wal-Mart rose 0.7 percent to close at $65.99 in New York. The shares have gained 10 percent this year.
Last week, all 15 directors were re-elected and one new director, Marissa Mayer, who is vice president of Local and Maps for Google Inc., joined the board.
“A substantial majority of our shareholders supported their election,” David Tovar, a Wal-Mart spokesman, said today in an e-mail.
In the weeks leading up to the annual meeting, pension funds in California, Connecticut, Maryland, Massachusetts and New York all cited the company’s handling of the bribery investigation as cause to vote against Duke, Scott, Walton and other directors.
The votes against the directors should send a message to Wal-Mart that its board needs more independent directors, New York City Comptroller John Liu said today in a statement.
“The results are a vote of no confidence that sends a message to Wal-Mart’s entire board, which has ignored our concerns and failed to safeguard the company’s standards of ethical and legal compliance,” Liu said. “It’s up to the board now to restore investor confidence.”
In response, Tovar said that the company will continue its investigation and act once the probe is completed.
“We will do the right thing the right way and we hope people will judge us by our actions after the investigation is concluded,” Tovar said in an email.