1. Evaluate how Wal-Mart has ranked and responded to various stakeholders.
2. Why do you think Wal-Mart has had a recent number of ethical issues that have been in the news almost constantly?
3. What do you think Wal-Mart could do to develop an improved ethical culture and respond more positively to its diverse stakeholders?
Many groups have a stake in what Wal-Mart does. Stakeholders can be broken down into two diverse groups: market stakeholders (shareholders, employees, consumers, and suppliers and non-market stakeholders (labor unions and environmental stakeholders).
With the shareholders, whose focus is to see profit, Wal-Mart ranks number one, 2008 per Fortune 500 magazine and listed as the 13th most profitable company with $11.3 billion dollars in earnings for 2006. Shareholders equity is over $64 million dollars. 1 (Fortune 500, 2008, CNNMoney.com)
Wal-Mart definitely makes their shareholders money. The fundamental question is whether the shareholders care about Wal-Mart’s scrutiny. Shareholders should have some concern on how the world views Wal-Mart and how long they will hold up under the scrutiny.
Employee stakeholders have another story. The discrimination lawsuits ranging from female employees not getting equal pay or equal positions, to disabled employees, class-action lawsuits stating that Wal-Mart doctors questionnaires to prevent disabled workers from applying, Wal-Mart does not rank very high with these employees. Lawsuits stemming from Wal-Mart’s failure to monitor labor conditions at oversea factories and hires illegal immigrants add to the rift in relations between the employees and the company. Wal-Mart continues to deny charges, yet settle cases.
The most disturbing is that Wal-Mart states as part of their company’s purpose “Saving people money so they can live better.” 2 (Walmartstores.com) has been accused of low benefits, working a minimum of 28 hours (full time) and allowing the tax payer to make up the difference, failing to provide health insurance to more than 60 percent of its employees, and part-time employees are excluded from Wal-Mart’s health plan. Those in the plan are underinsured. Some competitors must lower wages by 3.5 percent to operate in the same location and stay in business.
With Wal-Mart being sued for poor working conditions; denying pay, lunches and breaks it is no wonder why Wal-Mart, even with all of the money it makes, has not managed to make it on the 100 Best Places to work. 3 (Fortune 500, 2008, CNNMoney.com)
Wal-Mart has missed the mark on their purpose statement. How can you assist in helping people live better if you are not taking care of the people that work for you?
As stakeholders, consumers may complain about Wal-Mart but they still shop there. When push comes to shove, consumers put aside their morality for the sake of a cheaper price. Wal-Mart is shopped by 84 percent of American...