Walmart boss says work to do on racial injustice and other social issues

Walmart CEO Doug McMillon said there is no such thing as “business as usual” at the retail giant. “Not a day goes by that we are not asking ourselves how we can do more —do better,” he noted in his opening statement in the company’s annual Environmental, Social and Governance (ESG) report released Wednesday (Aug. 26).

He said the health crisis that quickly spread around the globe this year has been no exception.

“Followed by the senseless and tragic killing of George Floyd, our nation has questioned where we go from here. Collectively, we’ve agreed: We have work to do,” McMillon said.

In light of the added challenges in 2020, McMillon said Walmart has been pushed in ways he never could have imagined.

“In every decision we’ve made, we’ve worked to prioritize the safety of our associates and customers. Reflecting back, one thing is clear: We’re not just a retailer. This team of ours – more than 2.2 million strong at the moment – is special. We’re a lot like a family. And when we hurt, we care for each other. We care for our customers. And we care for our communities,” he said in his opening remarks.

McMillon responded to critics who say Walmart is doing business at the expense of its people and the planet. He said Walmart has been using its scale to create positive change and that didn’t begin in 2020. He said founder Sam Walton’s mission to serve people so they could live better is not a short-term vision, but one that continues to evolve. McMillon is proud of the wage increases Walmart made in recent years and the $1 per day college benefit along with advanced job training, paid family leave and adoption coverage.

But that is no longer enough, McMillon said, noting that there is still much to debate but it’s time for businesses to take the lead working together with the government on serious issues like workforce opportunity, racial equity climate and sustainability.

Since 2018, Walmart said the company has trained more than 1.8 million employees through its academies, of which 59% of the participants were women. Walmart employees have completed 88,000 college credits through the Live Better U program which the company unveiled in 2018. That is the equivalent of more than 733 bachelor’s degrees. Walmart has raised its starting minimum pay to $11 an hour, which is still below the $15 paid by Target and Aldi, but the retailer has said it’s not about where you start but how quickly you can move up. Walmart said wages vary from state to state but $11 is still well above the $7.25 federal minimum wage.

The retailer said the average wage in stores is $14 per hour. When factoring in benefits such as cash bonus, paid time off and health coverage, discounts and 401(k) match the average U.S. employee in stores working full time earns more than $18 per hour. Most department manager roles can earn as much as $24.70 per hour not including bonuses and other benefits.

Those working in distribution and fulfillment centers earn an average of $20 an hour before benefits. Last year, Walmart said it paid nearly $730 million in quarterly cash bonuses to U.S. store employees. Walmart also said store managers earn in excess of $180,000 annually.

U.S. Sen. Bernie Sanders, I-Vt., has been critical of Walmart’s pay structure in its stores saying in June of last year the largest employer in the U.S. should and could do more to pay a “living wage to its workforce.”

“Walmart can strike a blow against corporate greed and a grotesque level of income and wealth inequality that exists in our country,” Sanders said in his three-minute remarks at the June 5, 2019, shareholder meeting held in Rogers. “Please do the right thing.”

DIVERSITY AND INCLUSION
Other social issues covered in the 140-page ESG report included efforts to improve racial and gender diversity. Walmart said it sourced $11.7 billion in goods and services last year from 2,900 diverse suppliers. Over the past 8 years, Walmart said it has sourced more $34.4 billion in goods and services from women-owned businesses.

In the era of a need for more Black people in high ranking positions and board of director appointments, Walmart still has work to do. The company said people of color make up 35% of management positions, 24% of officers, 40% of management promotions, 44% of hourly promotions and 45% of the total workforce of 2.2 million. Of the nine executives who report directly to McMillon, four are women and there is one person of color in Suresh Kumar, executive vice president and chief global technology officer, who is a native of India.

Among the next 37 officers, 21 are white men, 10 are women of color, and there is one Black man. Walmart’s board is compromised of 11 directors, three of which are women one of whom is Black. Among the eight men on the board, one is Hispanic and the others are white. Walmart said its board members have an average age of 53 years.

NEXT STEPS
“As we continue to manage a global health crisis and grieve the acts of racial injustice in our country, we’re pausing to think about where we go from here,” McMillon noted in the report.

He said Walmart is looking to use the lessons it has learned to help reshape a more equitable and sustainable future. The company is committed to pay equity, retail opportunities, making changes to policies regarding salient human rights issues, furthering its sustainability goals and achievements and appropriate responses and reducing gun violence.

In the coming year, Walmart said it will continue to foster strong relationships with human rights thought leaders and stakeholders to continuously improve the company’s practices and disclosures and identify new issues as they emerge.

The company said it will engage employees, suppliers, customers and the communities where it operates in additional dialogue to increase understanding of human rights concepts and relevant initiatives. Walmart said it will also advance the initiatives underway regarding human rights in the areas of culture, diversity and inclusion, responsible sourcing. retail opportunities, market access and recruitment.

“While the pandemic may have delayed progress and, in some ways, compromised the world’s capacity for positive action, it has also prompted people everywhere to work in new ways and consider how small but universal changes in behavior can produce large-scale, positive effects. We are all invited to consider how we can bring new unity of purpose, innovation and collective action to global challenges — an inflection point, still,” said Kathleen McLaughlin, chief sustainability officer at Walmart.