Analysis–Wal-Mart Management Ethics and Compliance Challenges

Assess how Walmart is managing ethics and social responsibility as one of the largest corporations in the world.
Ethical & Social Initiatives:

• Walmart developed an Ethical Standards Team to monitor the compliance of supplier factories and has dedicated $35 million to new processes and procedures, and developed ethical training sessions for more than 19,000 associates.
• In 2006 Walmart raised pay tied to performance in one-third of its stores.
• Improved its health benefits package by offering lower deductibles and implemented a generic prescription plan estimated to save employees $25 million dollars.
• Raised the employee minimum wage as part of a new employee-oriented initiative that included better training and shift scheduling.
• Walmart has set goals to be supplied entirely by renewable energy, create no waste, and sell products that sustain people and the environment.
• Walmart started a program to sell more local produce, defined as produce grown and sold in the same state.
• Walmart has contributed significantly to disaster management projects and economic empowerment for women.
• In 2001 Walmart established The Associates in Critical Need Trust, which provides grants to associates who have experienced unexpected emergencies such as natural disasters or death of a spouse. The trust has given over $100 million in grants.
• Walmart has made a commitment and partnered with 150 factories and 60,000 women to teach women valuable skills to help them escape poverty. It has also collaborated with the Women’s Business Enterprise National Council to add a unique “Women Owned” logo to products from women-owned businesses so customers can easily identify and support them if desired.
• Walmart has embarked on a health initiative after collaboration with Michelle Obama to lower the prices of fruits and vegetables and reduce the amounts of fats, sugars and salts in the foods it sells to address the growing concern of obesity.

2. Evaluate various ethical issues Walmart has faced and how the company responded to stakeholders.
Walmart’s has attempted to restore its image and relationship with stakeholders after numerous scandals including bribery, poor working conditions, accusations of pay and promotions discrimination against women.

• In 2004 Walmart formed its Global Ethics Office and released a revised Global Statement of Ethics to spread an ethical corporate culture among its global stakeholders. The office provides guidance on ethical decision making based on the Global Statement of Ethics and an ethics hotline.
• Walmart has an Ethical Standards Team to monitor the compliance of supplier factories with the company’s “Standards for Suppliers” and local laws. Walmart requires all suppliers to have an independent agency assess the electrical and building safety conditions of their factories. They have adopted a zero tolerance policy and have the right to terminate relationships with suppliers and subcontractors who violate its ethical standards.

3. What are Walmart's contributions to improving the well-being of consumers and the economic sustainability of society?

• Walmart’s recycling efforts have allowed the company to reduce its global plastic bag waste by over 38 percent since 2007. This has allowed the company to keep 80 percent of its U.S, operational waste out of landfills.
• Walmart’s goals of decreasing its waste and carbon emissions, and Sustainability Index has extended to all facets of its operations including suppliers. These efforts demonstrate Walmart’s desire to become a more sustainable company.

References

1. Ferrell, O. C., John Fraedrich, Ferrell. Business Ethics: Ethical Decision Making & Cases, 11th Edition. Cengage Learning, 20160101. VitalBook file.

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