Late last month, the Business Roundtable (BRT)—a collection of 181 of the country’s largest corporations—announced that it was breaking from over 20 years of precedent. Instead of prioritizing shareholder value over everything else, the BRT declared that it would elevate the interests of all other stakeholders—including customers, communities, and suppliers—alongside it. Most notably, the very framing of the BRT’s “Statement on the Purpose of a Corporation” was about American corporations committing to being better to their employees:
“Too often hard work is not rewarded, and not enough is being done for workers to adjust to the rapid pace of change in the economy. If companies fail to recognize that the success of our system is dependent on inclusive long-term growth, many will raise legitimate questions about the role of large employers in our society.”
Many wondered, as the Harvard Business Review did, whether the BRT’s drastic change of heart was empty rhetoric. The BRT did not do itself any favors among these skeptics when it made its next big announcement that it had appointed Doug McMillon, CEO of Walmart, as its next chairman.
After all, Walmart does not have a good history of valuing workers or acknowledging the changes that its employees call for. Walmart’s pay is so low that at the base pay of $11 an hour, full-time associates must often depend on food stamps to get by. Women associates at Walmart continue to allege that the company has discriminated against them for pay and promotions—an accusation that memos from the Equal Employment Opportunity Commission seemed to confirm last week. Walmart has also continued to relegate more and more of its workforce to frequently lower-paying, part-time positions—from 20 percent in 2005 to 50 percent in 2018. And Walmart stubbornly refuses to disclose whether women and people of color are paid less than white men.
The fact is: Walmart’s employees have long struggled for McMillon and his predecessors to recognize our “‘stakeholdership”—our status as essential stakeholders in the success of the company. We have called for decent pay and benefits, predictable schedules, and to be involved in the decisions that affect our lives and the stores where we spend eight hours or more every day.
So does Doug McMillon’s signature at the bottom of BRT’s statement mean that he is ready to start acknowledging us?
If so, he can start with a shareholder resolution that associates introduced at Walmart’s annual shareholders meeting in June, urging the corporation to include workers on its board of directors. The policy would require that hourly associates be included on the initial list of candidates from which new nominees for Walmart’s board are selected. Unsurprisingly, Walmart’s CEO and the Walton heirs who own half of the company opposed the proposal.
Doug McMillon has a chance to show that the BRT’s new priorities aren’t just words on paper. Up until today, Walmart has led the way in prioritizing shareholder payments like dividends and stock buybacks. In the first two quarters of its 2020 fiscal year, Walmart has spent $3.7 billion on stock buybacks alone. Research by the Roosevelt Institute showed that if Walmart had spent the $10 billion it allocated to stock buybacks in 2018 on fair compensation instead, one million Walmart workers could have seen their hourly pay rise by $5.66.
But instead of considering rewarding its employees for their concrete contributions to Walmart’s fortunes, Walmart seems to search for ways to pay us poverty wages. McMillon even has the gall to claim that Walmart cannot afford a $15 an hour minimum wage, even though its biggest competitors seem to do so just fine.
If I, Cat Davis, a Walmart associate of 11 years, were on the board, I would see to it that associates received raises to at least $15 an hour, matching commitments by Target, Costco, and Amazon. I would also ensure that long-term employees also get real raises instead of having their wages capped; when you’ve worked somewhere for 20 to 30 years, you deserve to be rewarded for your loyalty and dedication.
I would also seek to raise the declining morale of associates nationwide by overhauling our management and addressing the rampant problems of favoritism, inconsistency, and understaffing in stores. I would urge the board to work together to make sure as many folks as possible have the hours they want and need.
Nobody on Walmart’s board has the experience or understanding that associates have of the day-to-day life in Walmart stores. Doug McMillon’s appointment to lead the BRT seems to say he thinks we’re stakeholders. It’s about time he treated us like that.