Walmart is feeling the repercussions of The New York Times’ massive story about the Walmart bribery scandal in Mexico. Reps. Elijah Cummings (D-MD) and Henry Waxman (D-CA) have announced that they will begin an investigation into the company’s lobbying efforts against the Foreign Corrupt Practices Act, the Act that that the company allegedly violated with its bribes. The Huffington Post and The Washington Post reported on the lobbying effort. David Tovar, VP of comms for Walmart, denies this.
“Walmart has never lobbied on FCPA. Simply because Walmart is a member of an organization does not mean we agree with every position they take,” he said.
A shareholder, Henrietta Klein, has also sued both Walmart’s board and a number of officers over the damage to the company’s reputation and the cost of the investigation. The very busy Tovar says the company is looking at that lawsuit “closely.”
The company’s stock price has fallen dramatically, with $10 billion in market value disappearing. Poof. Also going bye-bye are opportunities to expand into new geographies.
And it’s not just the company that’s feeling the pressure. The former Walmart de Mexico CEO implicated in the scandal, Eduardo Castro-Wright, has relinquished his MetLife board seat citing a “personal reason.”
“…I now must focus my energy in spending personal time with my family and in protecting my good name and business reputation,” Castro-Wright’s letter to MetLife CEO Steve Kandarian further says.
Walmart’s response so far has been the quotes cited and the video below. It has also appointed a global compliance officer who will oversee other regional compliance officers. The person who will fill this position hasn’t been identified.
Tovar says in the clip that because the investigation is ongoing, it would be “inappropriate” to go further, but stresses the self-regulation the company is now (trying desperately) to demonstrate and how much they “wish” they could say more. Whatever.
“If these allegations are true, it is not a reflection of who we are or what we stand for,” Tovar says, stressing repeatedly that this was six years ago. Ages, you see. As GroundFloor Media‘s Gil Rudawsky says on PRDaily, the company is setting it up so that the company can point the finger at the bad apples rather than take corporate responsibility.
But the thing is, the Times lays out the actions taken by company officers to cover up the activity. It wasn’t just a bad apple. It was something the permeated the company leadership. Some of company leaders identified still work for the company. If the allegations are true, it appears to be a crystal clear reflection of what that company is.