Burgess COMMENTARY

Peter Burgess

Walmart Shuffles Leadership, New Sustainability SVP

Wal-Mart Stores Inc. shuffled its management ranks today, appointing a new chief financial officer, a senior vice president of sustainability, and a chief merchandising officer, as the world’s largest retailer looks to revive weak sales growth. By 24/7 Staff

As reported by The Wall Street Journal, Doug McMillon, Wal-Mart’s CEO since 2013, is revamping his team after warning in August that annual profits would miss forecasts and announcing this month a round of job cuts at the company’s Bentonville, Ark., headquarters.

The executive changes come ahead of a meeting with investors and analysts scheduled for Oct 14.

Wal-Mart said CFO Charles Holley, 59 years old, will retire at the end of the year and be replaced by 47-year-old Brett Biggs, who is currently CFO of Wal-Mart International. Mr. Holley has been CFO since 2010 and has spent more than 20 years with the company.

“Charles had an opportunity to support Doug while he got everything off the ground, and now he feels it’s the right time to move on,” said Wal-Mart spokesman Randy Hargrove. “It was his decision.”

Mr. Holley will receive payments totaling $1.9 million in the two years following his retirement and restricted stock worth about $2.1 million that wasn’t scheduled to vest until 2017 and 2018. He will forfeit, however, unvested performance-based shares worth around $5 million at current prices.

Doug McMillon, President & CEO, Wal-Mart Stores, Inc.

“We’re pleased that the investments we’ve made are helping to improve our business even if it’s not as fast as we would like”Doug McMillon, President & CEO, Wal-Mart Stores, Inc. Also today, Wal-Mart named Steve Bratspies as chief merchandising officer for its U.S. stores, effective Oct. 19. In that role, Mr. Bratspies will oversee all merchandise categories across the more than 4,500 U.S. stores. He will continue to report to Greg Foran, Wal-Mart’s U.S. president.

Wal-Mart’s previous chief merchant left last November and the company had decided not to fill the position. Instead, executives in charge of food, apparel and other categories had reported directly to Mr. Foran.

Mr. Bratspies, an executive vice president, has been in charge of the food and grocery business for Wal-Mart’s U.S. stores. Charles Redfield, an executive at Wal-Mart’s Sam’s Club division, will replace him in that position, the retailer said.

In the quarter ended July, sales at Wal-Mart’s international operations dipped nearly 10% to $30.6 billion as foreign-exchange volatility dragged down the top line. During the same period, sales in the U.S. segment rose 4.8% to $74 billion. Sales at U.S. stores open for at least a year rose 1.5% in the quarter.

Faced with increased competition, Wal-Mart is spending heavily to make its stores more convenient places to shop, adding staffing to speed checkout lines and make sure shelves are better stocked. In April, the company raised its minimum hourly wage paid to $9 and said it would boost pay to $10 for many employees by February.

The company’s investments on behalf of customers have crimped profits but helped reverse a sales slump: Wal-Mart is drawing more shoppers who spend slightly more during their visit. In a conference call following the release of second-quarter results, Mr. McMillon said the company was in a period of change but noted that it had rebounded from similar circumstances before.

New Senior Vice President of Sustainability

The woman tasked with fusing online and brick-and-mortar sales for one of the world’s biggest retailers, Walmart, is moving to the company’s sustainability department.

Laura Phillips, Walmart's new senior vice president of sustainability

Laura Phillips, a 20-year veteran of the $210 billion multinational, will become the company’s senior vice president of sustainability Jan. 1, according to an internal memo provided to GreenBiz.

Phillips, who most recently served as an SVP honing Walmart’s “omnichannel” corporate strategy, will report in her new role directly to Walmart Chief Sustainability Officer Kathleen McLaughlin.

But the interplay between the company’s digital efforts and its sustainability department doesn’t stop with Phillips.

Manuel Gomez, Walmart’s previous vice president of sustainability, has accepted a new position with Walmart de Mexico and Central America as vice president of strategy for e-commerce, a company spokesperson told GreenBiz.

The shuffling comes as Walmart experiments with different ways to integrate sustainability into its supply chain, sales and marketing efforts - though plenty of critics still question how sustainable the company’s business model built on mass consumption really is.

While Amazon recently overtook Walmart as the world’s largest retailer, the company still rings up about $1 billion in sales every day.

When it comes to the sustainability of day-to-day operations, Walmart has set a goal of attaining 100 percent renewable energy, but, like many large companies, has not committed to a specific time frame.

The retailer has invested in on-site renewable energy generation and entered large power purchase agreements as part of a goal of getting 7 billion kilowatt-hours of clean energy by 2020.

Fortune magazine recently named Walmart No. 4 on a corporate “change the world” list, thanks to the “massive scale” of the company’s sustainability efforts.

Climbing the Ladder

In Phillips, Walmart is promoting an executive who already has had a hand in several environmental initiatives without formally being part of the sustainability department.

“She was part of the original group of key leaders that our former CEO Lee Scott assembled in 2004 to help develop Walmart’s sustainability strategy, initial goals and principles,” McLaughlin wrote in the memo detailing Phillips’ new role.

Since then, Phillips has worked with NGOs and academics to “develop solutions to sustainable value chain creation,” such as implementing new standards for sustainable seafood and hazardous chemicals.

Phillips also has seen the organization from drastically different vantage points.

“She began her Walmart career as a store intern and has grown up in Walmart U.S., working her way up from a buyer for toys, cosmetics and fresh flowers to vice president,” McLaughlin wrote. “Laura will help ensure Walmart remains on track to meet our aggressive sustainability goals.”

Source: Greenbiz

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