Wal-Mart shrinks board membership to 12 from 15
NEW YORK (AP) — Wal-Mart is shrinking the number of board members to 12 from 15 as it looks to bolster the board for the future.
As part of the changes, four directors, including its former CEO Mike Duke and Jim Walton, the son of the retailer's late founder Sam Walton, will not stand for re-election at the company's annual shareholders' meeting, set for June 3. But the board is adding the founder's grandson to the board in keeping with its history of having three Walton family members as directors.
The move comes as Wal-Mart Stores Inc. disclosed in a Securities and Exchange Commission filing that the total compensation package of its CEO Doug McMillon rose 2 percent to $19.4 million for the year that ended in January.
"With these retirements, we view this as a time to make our board more nimble, while maintaining its independence and further aligning on Wal-Mart's strategic priorities," said Greg Penner, chairman of the board, in a statement.
Wal-Mart is overhauling its business as it seeks to compete better with online leader Amazon.com and other rivals. The company's total revenue fell slightly in the fiscal year that ended in January to $482.1 billion — the first annual drop since the company went public 45 years ago. Net income fell 10 percent to $14.7 billion as higher wages and investments in technology squeezed results.
And in February, the company lowered its annual sales growth outlook for the current year to be "relatively flat," compared to the previous estimate for growth of 3 percent to 4 percent. The slowdown comes as it trimmed its global store count and is facing currency fluctuations.
As part of the board's succession planning, the board has nominated Steuart Walton, the son of Jim Walton, for election to the Wal-Mart board. Steuart Walton is the CEO of Game Composites, a company he founded in 2013 that designs and builds small composite aircraft. He previously worked for the London office of Allen & Overy LLP, handling matters related to debt and equity offerings by non-U.S. entities. He also worked for Wal-Mart International, focusing on mergers and acquisitions.
The founder's son Robson Walton remains on the board. Robson Walton was succeeded by his son-in-law Penner as chairman last year.
The Bentonville, Arkansas-based company says that the board will maintain an independent majority at 67 percent of its members after the changes.
The other retiring board members are Aida Alvarez, who joined the board in 2006 and was a member of the audit committee. She was administrator of the U.S. Small Business Administration and a member of President Clinton's cabinet from 1997 to 2001. Also retiring from the board is Roger Corbet, who joined the board in 2006. He is the retired CEO and group managing director of Woolworths Ltd., based in Australia.
Shares of the company are up this year and are hovering around $69.
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