By Shelly Banjo
Former Wal-Mart Stores Inc. Chief Executive Lee Scott and
investment banker Christopher Williams, chair of the board's audit
committee, will retire from the company's board of directors,
Wal-Mart said in a securities filing Wednesday.
Mr. Scott has served on the board since 1999 and received
$244,660 in compensation last year. Mr. Williams, chairman of
Williams Capital Group LP, joined the board in 2004 and received
$384,821 in compensation last year.
Spokesman Randy Hargrove said directors on Wal-Mart's board
stand for re-election every year and typically rotate off the board
every 10. In Mr. Scott's case, his decision was tied to the
ascension of Doug McMillon as Wal-Mart's CEO in February, Mr.
Hargrove said. Mike Duke, who stepped down as CEO in February, will
remain on the board.
Mr. Williams has been chairman of Wal-Mart's audit committee,
which has overseen an internal investigation into potential
violations of the Foreign Corrupt Practices Act, including
allegations Wal-Mart violated U.S. antibribery laws to speed store
openings in Mexico last decade. Wal-Mart has said it is under
investigation by the Justice Department and Securities and Exchange
Commission over alleged FCPA violations and is cooperating with
those inquiries.
Wal-Mart said its audit committee conducted 13 additional
meetings related to the investigations and compliance matters. For
this reason, members of the audit committee received an additional
$75,000 in compensation, with the chair of the audit committee
receiving $100,000.
For the first time, Wal-Mart said it tied part of its
executives' pay to the overhaul of its compliance program,
including the development of enhanced compliance procedures and
hiring of compliance professionals.
The company didn't give details, but said its executives made
"adequate progress" on these objectives, so they didn't lose out on
any cash awards.
Executive payouts based on company performance were below target
levels, as Wal-Mart missed sales and other financial targets. Mr.
Duke lost out on $1.6 million in performance pay as a result.
"Each of our operating segments fell short of its target sales
goals, and our total company and our Sam's Club segment fell short
of their threshold sales goals under this program," the company
said in its proxy filing. "As a result, the fiscal 2014 performance
for each of our executive officers was significantly less than
target, and were at the lowest levels of the last several
years."
Meanwhile, Mr. McMillon was awarded $25.6 million in total
compensation, the bulk of which comes from $23 million in stock
awards that are tied to financial performance over three years.
Also in January, Wal-Mart's board approved a special
performance-based cash award for the chief executive of Wal-Mart's
U.S. division, Bill Simon. The $2.5 million award is contingent on
the sales performance of Wal-Mart's Neighborhood Markets, a
smaller-format grocery store in the U.S.
"The purpose of this award is for retention purposes and to
emphasize our smaller-format growth strategy in the U.S.," the
company said in the filing.
Write to Shelly Banjo at shelly.banjo@wsj.com
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