Corporate Greed

Wal-Mart Stores Inc. declared that members of its board's audit committee were paid more for the latest year due to extra work they had to take on to handle an ongoing investigation into alleged foreign bribery.

The world's largest retailer also said in its annual proxy, filed with U.S. regulators late on Monday, that three board members would not stand for re-election at the company's June 7 annual meeting, and that Chief Executive Mike Duke and some other executives were paid more as sales and profit grew.

 

Back in November 2011, Wal-Mart began its own probe into matters including alleged violations of the U.S. Foreign Corrupt Practices Act, and whether such matters were appropriately handled by the company.

The issue was brought into the public spotlight one year ago, when the New York Times published a report that described how Wal-Mart had intentionally stifled an early internal probe into allegations that Wal-Mart de Mexico officials had paid bribes to help build stores in Mexico.

During fiscal 2013, which ended in January, the audit committee met 15 times while other committees met five times or seven times, and the full board met six times, Wal-Mart said.

Members of the audit committee were paid an additional $60,000 fee, while the committee's chairman, Christopher Williams, received an $85,000 fee, the company said.

Wal-Mart said that due to the audit committee's extra work, it decided to double the cash portion of the annual retainer for audit committee members, and doubled the chair fee for the chair of the audit committee.

Williams earned $189,000 in fees for fiscal 2013, the most of any of the 15 board members who are not part of Wal-Mart's management team. Williams, who is chairman and CEO of investment bank Williams Capital Group, has been on Wal-Mart's board since 2004. In last year's board elections, when some shareholders voted against certain board members due to the foreign bribery allegation issue, 13.3 percent of votes were cast against him.

Wal-Mart spent $157 million last year on its probe of alleged bribery allegations in Mexico, Brazil, China and India, and on improvements to its compliance programs.

The company said that James Breyer, the board's presiding director, and M. Michele Burns are each leaving the board after more than 10 years of service. Meanwhile, Arne Sorenson has decided to focus on his role as chief executive of Marriott International Inc. Sorenson is one of the members of the audit committee.

CEO Mike Duke earned $20.7 million last year, up from $18.1 million a year earlier, as the retailer continued to grow despite a sluggish U.S. economy and concerns over the alleged international bribery. Wal-Mart noted that Duke will earn a significant majority of his overall compensation only if the company meets certain performance goals.

Wal-Mart's total sales rose 5 percent to $466.11 billion in the fiscal year that ended in January, while earnings per share rose 10.6 percent to $5.02 per share. Sales at Walmart U.S., the company's largest unit, rose 3.9 percent to $264.19 billion.