As if Walmart wasn't already having a rough day in the media, The New York Times just published a devastating piece on the company's habit of paying off Mexican officials to get what it wants. We're not talking a few bucks here to get out of an inspection or a couple hundred pesos there to speed up the permit process. We're talking about millions of dollars worth of bribes that gave Walmart de Mexico, the company's branch south of the border, the power to pretty much do what it wanted. In one instance, it even paid an official to adjust a map designed to create a protective zone around the region's priceless pyramids. World heritage be damned. If Walmart wants its store in a convenient location, Walmart will get its store in a convenient location.
The details really do make Walmart look pretty evil. After "traveling to dozens of towns and cities in Mexico" and collecting "tens of thousands of documents related to Wal-Mart de Mexico permits," The Times found that Walmart bribed local and national officials to build 19 stores, sometimes in "environmentally fragile" areas and other times without construction permits. Some individual stores required nearly a million dollars in bribes for Walmart to get what they wanted. This passage from the Times exposé sums up the problem well:
Wal-Mart de Mexico was an aggressive and creative corrupter, offering large payoffs to get what the law otherwise prohibited. It used bribes to subvert democratic governance -- public votes, open debates, transparent procedures. It used bribes to circumvent regulatory safeguards that protect Mexican citizens from unsafe construction. It used bribes to outflank rivals.
If you care about labor rights, worry about corporate ethics or simply just like a good story, the Times piece is worth reading in full. But even with just a glance at the headline, you're probably not surprised about the idea of Walmart bribing Mexican officials to get its way. It was just a few months ago that The Times published a similary condemning piece about how Walmart leaders were called in to expand an investigation into bribery allegations in Mexico but instead simply shut it down. Even more recently than that, we learned of a federal probe into Walmart's suspected bribery habits in not only Mexico but also China, Brazil and India. In India, they actually had to suspend senior executives for bribery-related accusations about a month ago. "It showcases that these are Wal-Mart's practices worldwide," Indian lawmaker Prakash Javadekar told The Times.
Walmart's global headquarters is not unaware of the bad behavior of its international subsidiaries. In fact, the company spent some $100 million hiring lawyers and investigating alleged corruption in Walmart's ranks around the world. Investigations aside, corruption (read: cold hard cash) is still clearly the currency the company's foreign executives are using to buy its way into new markets. In Mexico, specifically, it seems like local officials are having a real hard time saying no. If you were making $47,000 a year working as the mayor of a Mexican town, and Walmart offered you three years salary just for signing off on an illegal permit, you might have a hard time saying no, too.