Walmart shareholders face record investor proposals

Context: This year's proxy seeks votes on 11 director nominees and three company business proposals — which the retailer suggests participants vote "for" — along with the eight submitted by outside investors — for which the company suggests an "against" vote.

• The external recommendations touch on topics including executive compensation, and racial equity and diversity reports.

The big picture: Consumers, shareholders, and employees increasingly expect companies to take stances on social issues as part of their corporate strategy.

• In the polarized political climate, it's unlikely all stakeholders will be pleased with a company's position — take the Walt Disney Company for example, which took a big hit in this year's Axios Harris Poll 100 — or Bud Light.
• Some conservative groups are even offering text alerts so consumers can avoid buying from businesses that don't align with their values.

Details: The eight external proposals Walmart shareholders will vote on would require the company to:

• Adopt a policy that considers the pay grades of all Walmart employees when setting target amounts for CEO compensation;
• Prepare a report on the company's human rights due diligence process to prevent adverse impacts on its domestic and foreign operations and supply chains;
• Conduct a racial equity audit;
• Publish an annual report to help ensure the company doesn't discriminate on the basis of race or sex in employee layoffs;
• Require shareholder approval of certain amendments to corporate bylaws;
• Develop a report detailing risks to the company of fulfilling information requests relating to customers for the enforcement of state laws criminalizing abortion access;
• Conduct an annual risk assessment of the impact of communist China on the company's global operations;
• Hold an independent review on the impact of corporate policies and practices on workplace safety and violence.

Reality check: The majority of shareholders generally vote the way the company recommends.

• Following each of the proposals listed in the fiscal 2023 proxy statement, Walmart points out — in most instances — the recommendations are largely redundant to its existing policies or practices.

The other side: "As the nation’s largest private employer, Walmart has a clear responsibility to confront any human rights violations in its operations and supply chains," Gina Cummings, Oxfam America’s vice president of advocacy, said in a recent statement.

• "But in order to respond effectively, the company first needs to know that they’re happening. That’s why human rights due diligence is [such a] crucial component of this process."

Meanwhile, in addition to urging a vote for the 11 directors, Walmart wants shareholders to ratify Ernst & Young as the company's accountant.

• Two proposals Walmart submitted would allow shareholders to have advisory voting related to the company's executive compensation.

What's next: The company this week is hosting media from around the globe and usually has an announcement or two.