Wal-Mart keeps it all in the family as chair goes to Greg Penner
FAYETTEVILLE, ARK. >> WalMart is passing the chairmanship of the world’s largest retailer from the eldest son of late founder Sam Walton to a third generation.
The company said that board Chairman Rob Walton will step down and be succeeded by Vice Chairman Greg Penner, who is his son-in-law.
The change took effect at the end of the company’s annual shareholders’ meeting Friday and came despite pressures from labor-backed worker groups to name an independent chairman. The calls for independent leadership mounted in the wake of allegations of bribery in Mexico and other countries WalMart operates in that came to surface in spring 2013.
Walton, son of Wal-Mart founder Sam Walton, has been chairman since 1992. The company says the 70-year-old will continue to serve as a director. Jim Walton, another son of the late founder, also remains on the board.
Penner, whose background is in technology and finance, will be the company’s third chairman in the company’s 53-year history. Rob Walton took over as chair upon the death of his father in 1992. The announcement comes WalMart is facing challenges on all fronts, from how it runs its operations to how it treats its workers.
Penner, 45, joined WalMart as a management trainee and held a number of positions including senior vice president of finance and strategy for Walmart.com and chief financial officer for the Japan
unit. He had been a general partner of Madrone Capital Partners, an investment management firm since 2005. He joined Wal-Mart’s board in 2008. Rob Walton noted on stage at the meeting that Penner is married to his daughter.
Penner had been the chairman of the company’s technology and e-commerce committee since it was formed in 2011 and has been instrumental in guiding the company on the technology front.
“You’ve been a great mentor. No one can fill your shoes,” said Penner, referring to Walton. Penner joined Walton on stage as well as Doug McMillon, the company’s CEO, and former CEO David Glass who served at the helm f rom 1988 to 2000.
Walton said that Penner “brings an ideal blend of finance, technology, and international business expertise — as well as a deep knowledge and love of Wal-Mart — to this role.”
The announcement was not a surprise after Walton named Penner as vice chairman at last year’s annual shareholders’ meeting. The Walton family controls about 50 percent of the company’s shares.
Keeping with Wal-Mart’s practice of showcasing celebrities at the annual event, the meeting was being hosted by actress Reese Witherspoon. Singers Brian McKnight, Rod Stewart and Ricky Martin also performed on stage. Entertainer Carol Burnett was on stage, too, and did her trademark Tarzan call.
“I was born and raised in the South. It’s nice to be back in the South,” said Witherspoon. “I can get my y’alls out.” She said she grew up shopping at Wal-Mart.
The meeting, held at Bud Walton Arena at the University of Arkansas., 30 miles away from the company’s headquarters in Bentonville, was packed with 14,000 workers from all over the world.
Despite all the hoopla, the company is under a microscope. Revenue at U.S. stores open at least a year have risen for three straight quarters, but that came af- ter seven straight declines. And the recent increases have been small.
Like many retailers catering to lower-income shoppers, Wal-Mart has been hurt by an uneven economy that hasn’t buoyed its customers financially. Meanwhile, shoppers are increasingly researching and buying online, and the company faces intensifying competition from dollar stores and Amazon.com.
To counter that pressure, Wal-Mart is accelerating the rollout of smaller stores and also investing in tech- nology, like online grocery services. It just launched a subscription service for online shoppers with an annual fee of $50.
But the company, which is also under pressure from labor-backed groups to treat its workers better, is also investing in its workers. The company announced earlier this year $1 billion in wage increases and improved training that includes raising the minimum hourly pay for its workers to $9 in April. By next February, Wal-Mart will raise that minimum to $10.