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Carly Fiorina to Wal-Mart: Try These Next Steps
April 24, 2012
[ by Melanie Gretchen ]
Carly Fiorina, the former CEO of Hewlett-Packard, who has served on some high powered corporate boards, speaks from experience when she offers her opinion on how Wal-Mart, the world's largest retailer, might best deal with its bribery probe that is sure to grow in stature and importance.
"Having served as a Chairman, CEO and board member of large multi-national companies, I know something about the challenges involved in managing far-flung operations. I also know that any allegation of a breakdown in control processes, management responsibilities or corporate values must be thoroughly investigated."
What Wal-Mart Should Do Next: The charges facing Wal-Mart are extremely serious - large-scale bribery and a multi-year cover-up - meaning that there is no to waste. Wal-Mart Directors Board must immediately appoint a completely independent team to determine the facts.
- One that includes outside investigators, outside counsel and independent Board members.
- The team must separate itself from management at all levels of the company, including the Board room. The team must be perceived as independent by everyone inside and outside the company. [C-I Note: "Perception is 9/10's of the law."]
- The team should have absolute latitude and authority to follow the investigation wherever, and to whomever, it leads.
- While this investigative team must have broad authority, its own conduct must be beyond reproach. The team will be expected to account for its every action and decision and catch-phrases like, "the ends justifies the means,” just won't cut it.
- The team should seek to uncover every possible angle to determine the nexus of an and all possible issues - much as HP did with its pre-texting scandal, where the investigation into leaks from the Board room turned out to be worse than the original crime.
- Many of these critics will re-emerge, trying to take advantage of the company’s current difficulties.
- No doubt there are also opportunistic lawyers out there who are already trying to 'recruit' shareholders for possible lawsuits, hoping to pressure the company into settling even spurious claims during a time of reputational risk."
The Risk of More Leaks from Within. "People leak company information for all kinds of reasons: to right a perceived wrong, but also sometimes to settle a score or to protect or burnish their own reputation. Some leaks are accurate, some are not.
In an environment of constantly swirling headlines and 'revelations', the Wal-Mart Board and its independent committee should avoid speculation or pre-mature disclosure. Rather, they should be completely transparent about the process they are using to get to the truth.
- This should include the names of the independent Board members, who are providing investigative and legal services, to whom the team will report its findings and when they expect to be able to report progress.
- Shareholders should be satisfied with this disclosure for the time being, but should expect relatively rapid progress on the investigation."
Ms. Fiorina is the former Chairman and CEO of Hewlett-Packard. She has served on the Boards of Cisco, Kellogg, Merck, and Taiwan National Semi-Conductor. She is currently Chairman of Good 360, the largest on-line product donation marketplace in the world.
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