New York City’s pension funds are pushing Wal-Mart Stores Inc., the world’s biggest retailer, to keep an eye on how workers are treated at the plants of its international suppliers.
The New York Times reports that the city pension funds, which own less than 0.2 percent of Wal-Mart’s stock, will raise the proposal at the company’s annual shareholder meeting on Friday in Fayetteville, Ark. It would require vendors to publish annual reports documenting working conditions in their factories.
Michael Garland, who oversees shareholder activist efforts for the city comptroller’s office, said Wal-Mart pressures its overseas suppliers to cut costs, often leading to low pay, long hours or other mistreatment. Although the shareholder proposal is unlikely to pass, Garland hopes the maneuver will prod the company to consider how to deal with the issue of poor working conditions at its foreign suppliers’ factories.
“It is an opportunity to make the case directly to the board,” he said. “The expectation is you persuade the board that it’s the right thing to do for the company and for the shareholders.”
Wal-Mart opposes the initiative, saying it would be difficult to enforce and might threaten supplies. In January, the company asked the Securities and Exchange Commission for permission to strike the proposal. But the agency turned down the request, saying that “the proposal may focus on the significant policy issues of sustainability and human rights.”
Wal-Mart spokesman David Tovar told the Times that the company already has standards that address vendors’ working conditions, and failure to adhere to those standards might ”jeopardize that supplier’s continued business relationship with Wal-Mart.”
But Kalpona Akter, a Banladeshi labor organizer, said Wal-Mart suppliers in her country do not enforce minimum-wage laws. She said Wal-Mart occasionally sends auditors to monitor factory conditions, but workers are ordered by the suppliers’ managers to lie to the auditors about how much they are paid and how they are treated.
“We haven’t seen any Wal-Mart suppliers giving a living wage to workers,” said Akter, who will appear in Arkansas at the shareholder meeting.
