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BENTONVILLE, Ark. -- Wal-Mart Stores, Inc. said yesterday a New York Stock Exchange investigation requested by the AFL-CIO trade union confederation found the retailer is not violating exchange rules.
In its latest effort to rein in executive pay at large public companies, the union pension fund had called for an investigation of whether Wal-Mart management, rather than a compensation committee, played a role in selecting and retaining a consultant charged with determining the pay of the company's leadership.
The secretary-treasurer of the AFL-CIO trade union confederation made the request in a letter dated Feb. 23 to NYSE Regulation, Inc. chief of enforcement Susan Merrill, according to published reports. The AFL-CIO cited an NYSE rule that says compensation consultants should answer solely to corporate directors, not to management. It asked NYSE Regulation to open a formal investigation to confirm that Wal-Mart complies with the exchange's listing standards.
The AFL-CIO asked for the investigation after Wal-Mart rebuffed its request in October to provide a fuller account of its compensation practices, according to a Reuters report.
"The New York Stock Exchange has indicated that we are not in violation of its rules," Wal-Mart spokesman John Simley said yesterday.
Wal-Mart told Reuters it had asked the SEC for permission to omit a shareholder proposal submitted by the AFL-CIO, which asks for disclosure on how the company uses compensation consultants, from the proxy for its upcoming annual meeting.
The company said it intends to implement that proposal.
The AFL-CIO reportedly filed similar proposals at other companies including General Electric Co. and Home Depot, Inc. However, the group withdrew its proposals at both companies after each said it would implement the disclosure about consultants that the AFL-CIO was seeking.
Wal-Mart said its board is looking into whether to hire an independent compensation consultant to advise it on executive compensation.