Refer to Case 3: Wal-Mart Manages Ethics and Compliance ChallengesInvestors in your company have been complaining because they feel that top executives are taking the company in a bad direction. Investors are calling for new board members. How would you answer these stakeholders?Be sure to address:How Wal-Mart is managing ethics and social responsibilityWal-Mart’s response to ethical issuesWal-Mart’s contribution to improving economic sustainability of society 4:37 PM Fri Jun 9=QAAWHAT IS WALMART DOING TO IMPROVE ETHICS AND SOCIAL RESPONSIBILITY?Walmart is working to improve its ethical reputation along with its reputation for social responsibility and corporate governance. In 2004Walmart formed its Global Ethics Office and released a revised Global Statement of Ethics. The intent of the Global Ethics Office is to spread anethical corporate culture among its global stakeholders. The Global Ethics Office provides guidance on ethical decision making based on theGlobal Statement of Ethics and an ethics helpline. The helpline is an anonymous and confidential way for associates to contact the companyregarding ethical issues. Additionally, Walmart has an Ethical Standards Team to monitor the compliance of supplier factories with thecompany's "Standards for Suppliers" and local laws. Walmart claims that in a period of several months the firm interviewed 1,000 marketpersonnel in various countries, dedicated $35 million to new processes and procedures, and developed ethical training sessions for more than19,000 associates.In response to the bribery scandal, Walmart has completely overhauled its global compliance program. In 2014 it released its first GlobalCompliance Program Report detailing the changes it has made. The report categorized the changes into three broad areas: people, policies andprocesses, and systems. The changes include a completely new corporate division that combines ethics, compliance, investigations, and legalmatters into a unified organization all reporting to an Executive Vice President of Global Governance. The company has also hired "SubjectMatter Leaders" and "Subject Matter Experts" to provide expertise and advice in 14 areas of concern, such as anti-corruption and responsiblesourcing. Other highlights are a multi-year compliance training plan, improvements to reporting and collaboration communications channels,establishment of multiple compliance and ethics committees, and a commitment to being completely bribery-free, regardless of the cultureWalmart is operating in. Analysts have stated that, at least on paper, Walmart's initiatives are extremely thorough and innovative and deserveclose watch to see how they work in practice. Walmart will continue to release Global Compliance Program Reports annually to further detail itsaccomplishments and the compliance and governance steps it continues to take.Walmart has contributed significantly to disaster management projects and economic empowerment for women. The company donated over$1.5 million in aid for the victims of Hurricane Sandy, including money, food, and goods. In 2001 Walmart established The Associates in CriticalNeed Trust, which provides grants to associates who have experienced unexpected emergencies such as natural disasters or death of a spouse;the trust has given over $100 million in grants so far. In terms of increasing opportunities for women, Walmart made a commitment inpartnering with 150 factories and 60,000 women to teach women valuable skills to help them escape poverty. It has also collaborated with theWomen's Business Enterprise National Council to add a unique "Women Owned" logo to products from women-owned businesses so customerscan easily identify and support them if desired.The company has recently embarked on a health initiative to address the growing problem of obesity in America. Walmart U.S. President BillSimon met with First Lady Michelle Obama to discuss the issue. Walmart announced it would lower the prices of its fruits and vegetables andreduce the amounts of fats, sugars, and salts in the foods it sells. Specifically, the company formulated goals that included cutting sodium by 25percent and sugars by 10 percent in food under its Great Value brand over a five-year period. By putting its weight behind solving the obesityepidemic, the world's largest retailer might be able to create significant change toward healthier eating habits.Walmart TodaySaWalmart remains the preferred shopping destination for many consumers, particularly after the financial meltdown of 2008-2009. AlthoughWalmart prospered during the recession while other retailers suffered, the company's sales in many of its established markets have begun tostagnate or even decline. Walmart itself acknowledged that it strayed from Sam Walton's original vision of everyday low prices in order to courthigher-income customers. Several initiatives, such as Walmart's adoption of organic food and trendy clothes, did not achieve much success withdiscount shoppers. Walmart also underwent a renovation effort that cut certain products, such as fishing tackle, from its stores. These actionsalienated Walmart's original customer base. Households earning less than $70,000 annually defected to discounters like Dollar Tree and Familyy to discountDollar. Analysts believe Walmart's mistake was trying to be everything to everyone, along with copying its more "chic" rivals like Target. Becauseof these blunders, in addition to external pressures such as market saturation and strong competition from other retail giants, Walmart's sales inmany markets are experiencing a slump. As a result, Walmart is returning to Sam Walton's original vision and its "everyday low prices" mantra.The company launched a campaign, "It's Back," to signal the return of the merchandise it removed, and Walmart executives are encouragingstore managers to compare prices with competitors to ensure Walmart offers the lowest prices. Walmart is also investing significantly into e-commerce as an untapped area of growth in the hopes of competing more directly with Amazon and other e-commerce retailers that havedrawn away some of its customer base.Although Walmart's stagnating domestic sales were counterbalanced for a period by continuing steady growth in international markets, evenits growth in many foreign markets has slowed. The company continues to look for new opportunities to expand internationally to make up forlower growth in its established markets. This strategy requires Walmart to continually adapt to different social, cultural, regulatory, economic,and political factors. Walmart is known for its ability to adapt quickly to different environments, but even this large-scale retailer hasexperienced trouble. For instance, it was forced to withdraw completely from Germany and South Korea after failing to interest the localpopulations, and still has just a small number of wholesale-only stores in India, one of the world's largest markets, after failing to find a way tonavigate the country's complex regulatory environment for foreign retailers to sell directly to the public. Walmart's Brazil branch has also failedto achieve profitability after over two decades in the country, which some attribute to the retailer's everyday low pricing strategy simply beingincompatible with the Brazilian shopper culture of always checking multiple retailers for sales. The more Walmart expands internationally, themore the company must decide what concessions it is willing to make to enter certain markets.Despite the difficulties of operating globally, Walmart has achieved a number of successes. After years of struggling in the Japanese market, forexample, Walmart began turning a profit in 2008 through its acquisition of Japanese retailer Seiyu Ltd. It has also recently turned its attentionagain to India, expressing a new commitment to expanding its operations in the market, and is continually focused on further developing itspresence in China, with plans to open 115 new stores in the country by 2017. Though the company will likely experience several bumps in theroad, many of its international markets appear to offer strong growth potential.口420/642... 4:37 PM Fri Jun 9=QAAWalmart TodayWalmart remains the preferred shopping destination for many consumers, particularly after the financial meltdown of 2008-2009. AlthoughWalmart prospered during the recession while other retailers suffered, the company's sales in many of its established markets have begun tostagnate even decline. Walmart itself acknowledged that it strayed from Sam Walton's original vision of everyday low prices in order to courthigher-income customers. Several initiatives, such as Walmart's adoption of organic food and trendy clothes, did not achieve much success withdiscount shoppers. Walmart also underwent a renovation effort that cut certain products, such as fishing tackle, from its stores. These actionsalienated Walmart's original customer base. Households earning less than $70,000 annually defected to discounters like Dollar Tree and FamilyDollar. Analysts believe Walmart's mistake was trying to be everything to everyone, along with copying its more "chic" rivals like Target. Becauseof these blunders, in addition to external pressures such as market saturation and strong competition from other retail giants, Walmart's sales inmany markets are experiencing a slump. As a result, Walmart is returning to Sam Walton's original vision and its "everyday low prices" mantra.The company launched a campaign, "It's Back," to signal the return of the merchandise it removed, and Walmart executives are encouragingstore managers to compare prices with competitors to ensure Walmart offers the lowest prices. Walmart is also investing significantly into e-commerce as an untapped area of growth in the hopes of competing more directly with Amazon and other e-commerce retailers that havedrawn away some of its customer base.Although Walmart's stagnating domestic sales were counterbalanced for a period by continuing steady growth in international markets, evenits growth in many foreign markets has slowed. The company continues to look for new opportunities to expand internationally to make up forlower growth in its established markets. This strategy requires Walmart to continually adapt to different social, cultural, regulatory, economic,and political factors. Walmart is known for its ability to adapt quickly to different environments, but even this large-scale retailer hasexperienced trouble. For instance, it was forced to withdraw completely from Germany and South Korea after failing to interest the localpopulations, and still has just a small number of wholesale-only stores in India, one of the world's largest markets, after failing to find a way tonavigate the country's complex regulatory environment for foreign retailers to sell directly to the public. Walmart's Brazil branch has also failedto achieve profitability after over two decades in the country, which some attribute to the retailer's everyday low pricing strategy simply beingincompatible with the Brazilian shopper culture of always checking multiple retailers for sales. The more Walmart expands internationally, themore the company must decide what concessions it is willing to make to enter certain markets.Despite the difficulties of operating globally, Walmart has achieved a number of successes. After years of struggling in the Japanese market, forexample, Walmart began turning a profit in 2008 through its acquisition of Japanese retailer Seiyu Ltd. It has also recently turned its attentionagain to India, expressing a new commitment to expanding its operations in the market, and is continually focused on further developing itspresence in China, with plans to open 115 new stores in the country by 2017. Though the company will likely experience several bumps in theroad, many of its international markets appear to offer strong growth potential.The Future of WalmartWalmart can be viewed through two very different lenses. Some think the company represents all that is wrong with America, while others loveit. In response to criticism, and in an attempt to initiate goodwill with consumers, the company has continued to improve stakeholderrelationships and make efforts to demonstrate it is an ethically responsible company. Although it has faced controversy regarding competition,suppliers, employees, and global corruption, among other things, it has also demonstrated concern for sustainability initiatives and socialresponsibility. Its goals of decreasing its waste and carbon emissions and its new Sustainability Index extend to all facets of its operations,including suppliers. These efforts demonstrate Walmart's desire (whether through genuine concern for the environment or for its own bottom-line profits) to become a more sustainable company.Similarly, Walmart's creation of a sophisticated global ethics and compliance program shows it has come a long way since its beginning, whenformal ethics programs were deemed unnecessary. However, without strong monitoring systems and a commitment from top management toenforce the company's ethics policies such efforts will prove fruitless. Overseas bribery scandals and employee discontent have tarnishedWalmart's reputation. As a result, the company is working to improve internal control mechanisms and supplier auditing. Both critics andsupporters of Walmart alike are waiting to see whether Walmart's efforts will position the company as a large retailer truly dedicated to socialresponsibility.QUESTIONS FOR DISCUSSION口am1.Assess how Walmart is managing ethics and social responsibility as one of the largest corporations in the world.2. Evaluate various ethical issues Walmart has faced and how the company responded to stakeholders.3.What are Walmart's contributions to improving the well-being of consumers and the economic sustainability of society?SOURCES$15 & Full Time website, http://15atwalmart.org/ (accessed May 18, 2015); James Arkin, "D.C. Council panel hears testimony on 'living wage'bill targeting large retailers," The Washington Post, March 20, 2013, http://articles.washingtonpost.com/2013-03-20/local/37864098_1_minimum-wage-retailers-outlets (accessed May 15, 2015); Associated Press, "Former Wal-Mart executive isresentenced, avoids prison," Los Angeles Times, February 2, 2008, http://articles.latimes.com/2008/feb/02/business/fi-coughlin2(accessed May 15, 2015); Vikas Bajaj, "India Unit of Wal-Mart Suspends Employees," The New York Times, November 23, 2012,http://www.nytimes.com/2012/11/24/business/global/wal-marts-india-venture-suspends-executives-as-part-of-bribery-inquiryhtml?_r=o (accessed May 15, 2015); James Bandler, "Former No. 2 at Wal-Mart Set to Plead Guilty," The Wall Street Journal, January 7,2006, A1; James Bandler and Ann Zimmerman, "A Wal-Mart Legend's Trail of Deceit," The Wall Street Journal, April 8, 2005, A10; Shelly Banjo,"Wal-Mart Ads Tout American Success Story," The Wall Street Journal, May 3, 2013,http://online wei.com/article/S1000142412789722458200457846001html (accessed May 15, 2015): Shollu Ronio "Wal421/642I:...

Question

Refer to Case 3: Wal-Mart Manages Ethics and Compliance ChallengesInvestors in your company have been complaining because they feel that top executives are taking the company in a bad direction. Investors are calling for new board members. How would you answer these stakeholders?Be sure to address:How Wal-Mart is managing ethics and social responsibilityWal-Mart’s response to ethical issuesWal-Mart’s contribution to improving economic sustainability of society 4:37 PM Fri Jun 9=QAAWHAT IS WALMART DOING TO IMPROVE ETHICS AND SOCIAL RESPONSIBILITY?Walmart is working to improve its ethical reputation along with its reputation for social responsibility and corporate governance. In 2004Walmart formed its Global Ethics Office and released a revised Global Statement of Ethics. The intent of the Global Ethics Office is to spread anethical corporate culture among its global stakeholders. The Global Ethics Office provides guidance on ethical decision making based on theGlobal Statement of Ethics and an ethics helpline. The helpline is an anonymous and confidential way for associates to contact the companyregarding ethical issues. Additionally, Walmart has an Ethical Standards Team to monitor the compliance of supplier factories with thecompany's &#34;Standards for Suppliers&#34; and local laws. Walmart claims that in a period of several months the firm interviewed 1,000 marketpersonnel in various countries, dedicated $35 million to new processes and procedures, and developed ethical training sessions for more than19,000 associates.In response to the bribery scandal, Walmart has completely overhauled its global compliance program. In 2014 it released its first GlobalCompliance Program Report detailing the changes it has made. The report categorized the changes into three broad areas: people, policies andprocesses, and systems. The changes include a completely new corporate division that combines ethics, compliance, investigations, and legalmatters into a unified organization all reporting to an Executive Vice President of Global Governance. The company has also hired &#34;SubjectMatter Leaders&#34; and &#34;Subject Matter Experts&#34; to provide expertise and advice in 14 areas of concern, such as anti-corruption and responsiblesourcing. Other highlights are a multi-year compliance training plan, improvements to reporting and collaboration communications channels,establishment of multiple compliance and ethics committees, and a commitment to being completely bribery-free, regardless of the cultureWalmart is operating in. Analysts have stated that, at least on paper, Walmart's initiatives are extremely thorough and innovative and deserveclose watch to see how they work in practice. Walmart will continue to release Global Compliance Program Reports annually to further detail itsaccomplishments and the compliance and governance steps it continues to take.Walmart has contributed significantly to disaster management projects and economic empowerment for women. The company donated over$1.5 million in aid for the victims of Hurricane Sandy, including money, food, and goods. In 2001 Walmart established The Associates in CriticalNeed Trust, which provides grants to associates who have experienced unexpected emergencies such as natural disasters or death of a spouse;the trust has given over $100 million in grants so far. In terms of increasing opportunities for women, Walmart made a commitment inpartnering with 150 factories and 60,000 women to teach women valuable skills to help them escape poverty. It has also collaborated with theWomen's Business Enterprise National Council to add a unique &#34;Women Owned&#34; logo to products from women-owned businesses so customerscan easily identify and support them if desired.The company has recently embarked on a health initiative to address the growing problem of obesity in America. Walmart U.S. President BillSimon met with First Lady Michelle Obama to discuss the issue. Walmart announced it would lower the prices of its fruits and vegetables andreduce the amounts of fats, sugars, and salts in the foods it sells. Specifically, the company formulated goals that included cutting sodium by 25percent and sugars by 10 percent in food under its Great Value brand over a five-year period. By putting its weight behind solving the obesityepidemic, the world's largest retailer might be able to create significant change toward healthier eating habits.Walmart TodaySaWalmart remains the preferred shopping destination for many consumers, particularly after the financial meltdown of 2008-2009. AlthoughWalmart prospered during the recession while other retailers suffered, the company's sales in many of its established markets have begun tostagnate or even decline. Walmart itself acknowledged that it strayed from Sam Walton's original vision of everyday low prices in order to courthigher-income customers. Several initiatives, such as Walmart's adoption of organic food and trendy clothes, did not achieve much success withdiscount shoppers. Walmart also underwent a renovation effort that cut certain products, such as fishing tackle, from its stores. These actionsalienated Walmart's original customer base. Households earning less than $70,000 annually defected to discounters like Dollar Tree and Familyy to discountDollar. Analysts believe Walmart's mistake was trying to be everything to everyone, along with copying its more &#34;chic&#34; rivals like Target. Becauseof these blunders, in addition to external pressures such as market saturation and strong competition from other retail giants, Walmart's sales inmany markets are experiencing a slump. As a result, Walmart is returning to Sam Walton's original vision and its &#34;everyday low prices&#34; mantra.The company launched a campaign, &#34;It's Back,&#34; to signal the return of the merchandise it removed, and Walmart executives are encouragingstore managers to compare prices with competitors to ensure Walmart offers the lowest prices. Walmart is also investing significantly into e-commerce as an untapped area of growth in the hopes of competing more directly with Amazon and other e-commerce retailers that havedrawn away some of its customer base.Although Walmart's stagnating domestic sales were counterbalanced for a period by continuing steady growth in international markets, evenits growth in many foreign markets has slowed. The company continues to look for new opportunities to expand internationally to make up forlower growth in its established markets. This strategy requires Walmart to continually adapt to different social, cultural, regulatory, economic,and political factors. Walmart is known for its ability to adapt quickly to different environments, but even this large-scale retailer hasexperienced trouble. For instance, it was forced to withdraw completely from Germany and South Korea after failing to interest the localpopulations, and still has just a small number of wholesale-only stores in India, one of the world's largest markets, after failing to find a way tonavigate the country's complex regulatory environment for foreign retailers to sell directly to the public. Walmart's Brazil branch has also failedto achieve profitability after over two decades in the country, which some attribute to the retailer's everyday low pricing strategy simply beingincompatible with the Brazilian shopper culture of always checking multiple retailers for sales. The more Walmart expands internationally, themore the company must decide what concessions it is willing to make to enter certain markets.Despite the difficulties of operating globally, Walmart has achieved a number of successes. After years of struggling in the Japanese market, forexample, Walmart began turning a profit in 2008 through its acquisition of Japanese retailer Seiyu Ltd. It has also recently turned its attentionagain to India, expressing a new commitment to expanding its operations in the market, and is continually focused on further developing itspresence in China, with plans to open 115 new stores in the country by 2017. Though the company will likely experience several bumps in theroad, many of its international markets appear to offer strong growth potential.口420/642>>... 4:37 PM Fri Jun 9=QAAWalmart TodayWalmart remains the preferred shopping destination for many consumers, particularly after the financial meltdown of 2008-2009. AlthoughWalmart prospered during the recession while other retailers suffered, the company's sales in many of its established markets have begun tostagnate even decline. Walmart itself acknowledged that it strayed from Sam Walton's original vision of everyday low prices in order to courthigher-income customers. Several initiatives, such as Walmart's adoption of organic food and trendy clothes, did not achieve much success withdiscount shoppers. Walmart also underwent a renovation effort that cut certain products, such as fishing tackle, from its stores. These actionsalienated Walmart's original customer base. Households earning less than $70,000 annually defected to discounters like Dollar Tree and FamilyDollar. Analysts believe Walmart's mistake was trying to be everything to everyone, along with copying its more &#34;chic&#34; rivals like Target. Becauseof these blunders, in addition to external pressures such as market saturation and strong competition from other retail giants, Walmart's sales inmany markets are experiencing a slump. As a result, Walmart is returning to Sam Walton's original vision and its &#34;everyday low prices&#34; mantra.The company launched a campaign, &#34;It's Back,&#34; to signal the return of the merchandise it removed, and Walmart executives are encouragingstore managers to compare prices with competitors to ensure Walmart offers the lowest prices. Walmart is also investing significantly into e-commerce as an untapped area of growth in the hopes of competing more directly with Amazon and other e-commerce retailers that havedrawn away some of its customer base.Although Walmart's stagnating domestic sales were counterbalanced for a period by continuing steady growth in international markets, evenits growth in many foreign markets has slowed. The company continues to look for new opportunities to expand internationally to make up forlower growth in its established markets. This strategy requires Walmart to continually adapt to different social, cultural, regulatory, economic,and political factors. Walmart is known for its ability to adapt quickly to different environments, but even this large-scale retailer hasexperienced trouble. For instance, it was forced to withdraw completely from Germany and South Korea after failing to interest the localpopulations, and still has just a small number of wholesale-only stores in India, one of the world's largest markets, after failing to find a way tonavigate the country's complex regulatory environment for foreign retailers to sell directly to the public. Walmart's Brazil branch has also failedto achieve profitability after over two decades in the country, which some attribute to the retailer's everyday low pricing strategy simply beingincompatible with the Brazilian shopper culture of always checking multiple retailers for sales. The more Walmart expands internationally, themore the company must decide what concessions it is willing to make to enter certain markets.Despite the difficulties of operating globally, Walmart has achieved a number of successes. After years of struggling in the Japanese market, forexample, Walmart began turning a profit in 2008 through its acquisition of Japanese retailer Seiyu Ltd. It has also recently turned its attentionagain to India, expressing a new commitment to expanding its operations in the market, and is continually focused on further developing itspresence in China, with plans to open 115 new stores in the country by 2017. Though the company will likely experience several bumps in theroad, many of its international markets appear to offer strong growth potential.The Future of WalmartWalmart can be viewed through two very different lenses. Some think the company represents all that is wrong with America, while others loveit. In response to criticism, and in an attempt to initiate goodwill with consumers, the company has continued to improve stakeholderrelationships and make efforts to demonstrate it is an ethically responsible company. Although it has faced controversy regarding competition,suppliers, employees, and global corruption, among other things, it has also demonstrated concern for sustainability initiatives and socialresponsibility. Its goals of decreasing its waste and carbon emissions and its new Sustainability Index extend to all facets of its operations,including suppliers. These efforts demonstrate Walmart's desire (whether through genuine concern for the environment or for its own bottom-line profits) to become a more sustainable company.Similarly, Walmart's creation of a sophisticated global ethics and compliance program shows it has come a long way since its beginning, whenformal ethics programs were deemed unnecessary. However, without strong monitoring systems and a commitment from top management toenforce the company's ethics policies such efforts will prove fruitless. Overseas bribery scandals and employee discontent have tarnishedWalmart's reputation. As a result, the company is working to improve internal control mechanisms and supplier auditing. Both critics andsupporters of Walmart alike are waiting to see whether Walmart's efforts will position the company as a large retailer truly dedicated to socialresponsibility.QUESTIONS FOR DISCUSSION口am1.Assess how Walmart is managing ethics and social responsibility as one of the largest corporations in the world.2. Evaluate various ethical issues Walmart has faced and how the company responded to stakeholders.3.What are Walmart's contributions to improving the well-being of consumers and the economic sustainability of society?SOURCES$15 & Full Time website, http://15atwalmart.org/ (accessed May 18, 2015); James Arkin, &#34;D.C. Council panel hears testimony on 'living wage'bill targeting large retailers,&#34; The Washington Post, March 20, 2013, http://articles.washingtonpost.com/2013-03-20/local/37864098_1_minimum-wage-retailers-outlets (accessed May 15, 2015); Associated Press, &#34;Former Wal-Mart executive isresentenced, avoids prison,&#34; Los Angeles Times, February 2, 2008, http://articles.latimes.com/2008/feb/02/business/fi-coughlin2(accessed May 15, 2015); Vikas Bajaj, &#34;India Unit of Wal-Mart Suspends Employees,&#34; The New York Times, November 23, 2012,http://www.nytimes.com/2012/11/24/business/global/wal-marts-india-venture-suspends-executives-as-part-of-bribery-inquiryhtml?_r=o (accessed May 15, 2015); James Bandler, &#34;Former No. 2 at Wal-Mart Set to Plead Guilty,&#34; The Wall Street Journal, January 7,2006, A1; James Bandler and Ann Zimmerman, &#34;A Wal-Mart Legend's Trail of Deceit,&#34; The Wall Street Journal, April 8, 2005, A10; Shelly Banjo,&#34;Wal-Mart Ads Tout American Success Story,&#34; The Wall Street Journal, May 3, 2013,http://online wei.com/article/S1000142412789722458200457846001html (accessed May 15, 2015): Shollu Ronio &#34;Wal421/642I:...

Accepted Answer

Economic sustainability refers to the ability of an economy or a business to maintain long-term…