Wal-Mart Stores Inc.’s stock took another lashing in the markets Tuesday, falling 3 percent as the company’s damage control machine went into full whirl, warding off accusations that its Mexican expansion was fed by bribes that top executives later shrugged off.
Wal-Mart has been in contact with government regulators and is performing its own investigation into whether the company violated the Foreign Corrupt Practices Act, which makes it illegal for a U.S. company to pay bribes anywhere in the world.
A spokesman said the retailer initiated “a series of new escalation and review protocols” that would ensure bribery investigations are managed independently and that their findings are addressed.
“We have created a new global FCPA compliance officer position,” the spokesman said. “This position will have responsibility for compliance with the FCPA in every market around the world and will oversee five FCPA compliance directors based in the international markets.”
The anti-Wal-Mart crowd is making the most of the moment.
“The corporation’s tactics of bribery, scheming and corruption are the latest in a litany of despicable business practices including discrimination, worker mistreatment and predatory pricing,” said New York City Council Speaker Christine Quinn. “This is precisely the type of business we do not want in our communities and I remain committed to fighting against Wal-Mart’s corporate poison from entering the five boroughs.”
At the Barclays Retail and Restaurants Conference in New York, Carol Schumacher, the retailer’s vice president of investor relations, reminded investors that the allegations “are simply that at this point. They’re allegations.”
Duncan Mac Naughton, chief merchandising officer of the namesake U.S. division, bypassed the controversy and declared, “the U.S. business model is working, period.” The company added more than 10,000 items to its stores last year and is also focusing now on a solidly basic strategy in apparel.
The consumer is strained, though.
“It’s really about jobs, the sluggish recovery pace and then gas prices,” Mac Naughton said. “There are about 23 million Americans that are call it unemployed, underemployed or working part-time just to bring food to the table, so we don’t see real tailwinds here for the customer.”
Not all consumer-minded companies were feeling the squeeze. After the market closed, Apple Inc. said second-quarter profits nearly doubled to $11.62 billion on a 59 percent sales gain.
Still, retail stocks, which have generally outperformed the market this year, lagged behind on Tuesday. The S&P Retail Index, which does not include Wal-Mart, fell 0.5 percent, or 3.05 points, to 610.36. The Dow Jones Industrial Average, which does include Wal-Mart, seemed to shrug off the decline in the retailer’s shares, rising 0.6 percent overall, or 74.39 points, to 13,001.56.
Among the decliners were three of fashion’s strongest stocks: Under Armour Inc. fell 5.1 percent to $95.34, as Lululemon Athletica Inc. dropped 4.9 percent to $70.18 and Michael Kors Holdings Ltd. declined 4.8 percent to $41.32.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)