FAQ

ESG

• What it means to be a regenerative company?

  Being a regenerative company means going beyond compliance and doing what is right to have a positive socioeconomic and environmental impact that contributes to recovering the health and wellbeing of people, communities, and the planet, creating shared value for our stakeholders and, therefore, for our business. We are on the path to becoming a regenerative company, where nature and humanity are at the center of all our business practices. 

  2021 Annual Report, page 18

• What are the 4 pillars of a regenerative company?

  Opportunity

  • Good jobs and career opportunities for associates
  • Development opportunities for suppliers and local economies
  • Diversity, equality, and inclusion at Walmart and beyond
  • Giving access to customers

  Sustainability 

  • Mitigating climate change
  • Circular economy
  • Protec, manage and restore natural capital

  Ethics and Integrity

  • Highest ethical standards
  • Strong corporate governance
  • Digital citizenship
  • Respect for human rights
  • Promoting dignity throughout our value chain

  Community 

  • Serving communities where we operate
  • Access to safer, healthier products and services
  • Supporting local communities

  2021 Annual Report, page 20

• How did you determine your ESG strategy?

  Our ESG strategy is based on our 2021 materiality analysis, in 2021 materiality analysis reflects those topics which have growing importance for our stakeholders and for the Company. 

  Based on the results obtained from our materiality analysis, we identified the material ESG topics for the Company and for our stakeholders as well as risks and opportunities. That served as the basis for implementing action plans to improve our performance.

  We also have global goals for all the markets where Walmart operates, and we work in a collaborative way to achieve them.

  More info available here

• Do you have a committee that reviews the goals and results for the initiatives?

  We have a Regenerative Committee, led by our CEO, and composed of senior executives from key areas of the company. The Committee’s main functions are to define the company’s ESG strategy in the long-term, adjust operational processes, and make decisions; as well as to develop action plans for each material issue. This Committee meets four times per year.

  Each area is responsible for embedding ESG factors into their own processes and submit their progress into our ESG platform.

  2021 Annual Report page 26 

• Do you contribute to SDG?

  Yes. We are signatories of the UN Global Compact since 2019, fully incorporating sustainability into our business strategy and we make strategic decisions that help us achieve the UN Sustainable Development Goals (SDGs). Moreover, it provides us with the proper framework to reinforce our long-term commitment to commercial, responsible, and ethical practices.

  More info available here

• Environmental. Which are your main goals and what is your progress on each one of them?

  In 2020, we renewed our key commitments and goals, starting with our ambition to become a regenerative company by 2040: 

  Climate Change Mitigation

  • Zero emissions by 2040, the first step towards this goal is to reduce GHG emissions by 18% by 2025 vs 2015
    3.8% scope 1 and 2 emissions reduction vs 2020  
  • Source 100% of our energy from renewable sources by 2035
    52.5% of total energy comes from sustainable sources 
  • Work with our suppliers to reduce or avoid GHG emissions in our global supply chains by 2030
    776 suppliers participated in Project Gigaton 

  2021 Annual Report, page 181

  Circular Economy 

  • Send zero waste to landfill by 2025
    68.6% zero waste goal achieved  
  • Reduce food waste generation by 50% by 2025
  • Package Our Brands products with 100% recyclable, reusable, or compostable materials, avoid the use of unnecessary or difficult to recycle plastic and include 20% post-consumer recycled material by 2025
    45% of our packaging is recyclable, reusable, or compostable, 16% of post-consumer material is incorporated into the packaging of Our Brands
  • Reduce 3,000 tons of virgin plastic from our operations and Private Brands products by 2025, compared to 2020
    1,881 tons of virgin plastic reduction vs 2020, in Mexico

  2021 Report, page 182 

  Natural Capital 

  • By 2025, Private Brands products will use palm oil, paper, pulp and timber from certified sustainable sources.
    97.6% of palm oil and palm oil by products used in Private Brands are RSPO or Rainforest Alliance certified in Mexico 95.6% in Central America
  • By 2025, fresh and frozen seafood will be sourced through sustainable sources certified by BAP (Best Aquaculture Practices), MSC (Marine Stewardship Council) or a fishery improvement project 
    82% of our fish and seafood are certified as sustainable or come from a Fishery Improvement Project, in Mexico 76.1% in Central America
  • Help protect, manage, and restore at least 20 million ha. of land and 2.5 million km2 of ocean by 2040

  2021 Annual Report, page 183 

• Are you complying with GRI, SASBWhat are your main goals in climate change mitigation?

  Our annual report was structured aligned with the principal guidelines published by the Global Reporting Initiative (GRI) with the comprehensive option and the Sustainability Accounting Standards Board (SASB). Similarly, frameworks such at the UN SDOs and the Task Force on Climate-Related Financial Disclosures (TCFD) are reflected in the key subjects included in our reports. We also disclose our external reporting programs, such as the Carbon Disclosure Project (CDP). 

  At Walmart de México y Centroamérica, we strive to provide continuity to the clear and transparent disclosure of our performance. 

  2021 Annual Report, page 365

• How do you deploy the ESG strategy and make sure the operations team is working towards it?

  We are convinced that our customers should not have to choose between an affordable product and one that is good for the environment. That is why we work in our operations and supply chain towards developing responsible and sustainable sourcing that reduces the environmental impact of products in the life-cycle phases where they are most significant. 

  Since 2020, we set a new goal for our contribution to the preservation of biodiversity and nature. We understand our responsibility for the actions we undertake and, convinced of the capacity we have through our scale for the common good, we have decided to be a regenerative company by 2040. This ambitious goal reflects a long journey we have built with our suppliers, associates, and customers to ensure their shopping experience with us is increasingly sustainable. 

  We have found that there are common challenges in achieving this, so the alliances we have built with civic organizations, our business partners and specialized agencies allow us to chart a path based on priorities and existing knowledge to meet our goal. For example, in May 2022 we hosted our first Sustainability Summit where our leaders and commercial partners shared the different initiatives we are implementing as a company to help mitigate climate change, drive a circular economy, and protect and restore natural capital.

• Social. How do you generate value to all your stakeholders?

  Customers: Seamless access to affordable, trustable, and sustainable products and services

  Associates: Our associates are our priority, and we take them into account in all our decisions. We work every day on improving our value proposition for our associates to become the best place to be yourself, grow and belong based on policies regarding human rights, labor, and diversity & inclusion. 

  Suppliers: Access to markets and ability to accelerate supply chain sustainability

  Shareholders: Superior long-term returns through financial and ESG leadership

  Business Partners: Strategic alliances for strengthening ecosystems

  Communities: Resources to build stronger and more inclusive communities

  Planet: Leadership on renewable energy, waste, and sustainability

• Do you have a policy regarding human rights, labor rights, diversity & inclusion/ suppliers standards?

  1. Human Rights Declaration 

  We published our Human Rights Declaration in 2018. In our Human Rights Declaration we reinforce our commitment to fully comply with internationally-recognized human rights, not only within our own operations, but also throughout our entire value chain. 

  2. Labor Rights

  We are responsible for guaranteeing the labor rights of our associates, including wages and payments; benefits; and fair, equal, and inclusive treatment. We have various policies that reflect our respect for the labor rights of our associates. In Mexico, our labor rights policy is aligned to the Federal Labor Law. We have initiated a new collective bargaining system to enhance the value proposition of our associates, who have the option of choosing the union organization to which they wish to belong. All this is reflected in our Freedom of Association Policy. Through our Work Schedule Policy, our associates are guaranteed their rights, pursuant to labor legislature regarding work schedules and quality of life. Further, Our Remuneration Equality Policy ensures that Walmart de México y Centroamérica does not discriminate in wages due to gender, age, religion, sexual preference, or political ideology. 

  3. Diversity, Equality & Inclusion 

  Added to inclusion as a value proposition for our associates, we are constantly working to create safe and harassment and discrimination free environments. We guarantee a workplace environment that is founded on tolerance and respect, where associates, suppliers and strategic partners feel free to be themselves, and where their ideas, opinions, ideas, and identities are valued so they may develop to their maximum potential. Both in Mexico and Central America, we kept constant training and sensitivity programs on the importance to create safe, inclusive, and discrimination-free spaces for our associates.

  We have several company policies that strictly prohibit discrimination or harassment because of individual traits such as ethnicity, nationality, skin color, culture, gender,  age, disability, social strata, economic level, health, legal status, religion, physical appearance, genetic characteristics, migratory status, pregnancy, language, opinions, sexual orientation and/or preference, gender identity or manifestation, political identity or membership, marital status, family situation, family responsibilities, criminal background, or any other reason that nulls or voids recognizing or exercising one’s rights and accessing equal opportunities for all.

  For the fifth consecutive year, the Human Rights Campaign (HRC) Foundation certified us as one of the companies that promotes LGBT+ diversity and inclusion in the workplace, has been part of the Bloomberg Gender-Equality Index for five consecutive years. 

  2021 Report, page 148

• What are the standards you request from your suppliers?

  All suppliers must comply with the Walmart Supplier Standards. Among the requirements for both our suppliers and for those who supply them, are the following: 

  • Comply with the law 
  • Be transparent 
  • Never use forced or child labor 
  • Maintain a fair decision-making process regarding employment
  • Suppliers are charged with complying with these rules in all their operations and throughout the entire product supply chain, which are included in supplier agreements, published in seven languages.
  • Comply with all applicable laws and agreements on compensation and work hours
  • Recognize the freedom to associate and collective bargaining 
  • Provide a safe work environment

  More information available here

• How do you interact with the communities where you operate?

  Walmart’s purpose is to save people money and help them live better. We help families find solutions that make their busy lives easier, by providing them convenient access to affordable food items and other products around the world, while also generating economic opportunities and seeking to improve social and environmental sustainability to strengthen local communities. We provide resources to build stronger, more inclusive communities.

• How can minority shareholders’ voice their interests and concerns?

  Minority shareholders, whose shares represent a minimum of 10% of owners’ equity have the right to appoint and remove a Director, who in turn may be removed only when other Board members are so removed. Adolfo Cerezo, the Chairman of the Audit and Corporate Practices Committees, as the Lead Independent Director, also has the main assignment of acting as a link between minority shareholders of the company and its management. Independent directors must constitute a minimum of 25% of the total of the Board of Directors.

  Bylaws 

  Minority shareholders rights are located at Walmex’ articles of incorporation, i.e.:

  “ELEVEN.

  1. …

  4. The minority shareholders representing at least ten percent (10%) of the capital stock, represented by shares subscribed by the corporation, shall be entitled to:

  a) Appoint and remove a member of the Board of Directors.  Such appointment may only be revoked when the other members of the Board of Directors are also removed, in which case, removed members shall not be appointed as such for a period of 12 months immediately following the date of removal.  

  b) Request the Chairman of the Board of Directors or the Chairman of the Audit and Corporate Practices Committees, at any time, to call for a general shareholders’ meeting.

  …”

  Bylaws,  page 11

• How many independent directors do you have in the Board? How many women?

  The Board of Directors is composed solely by statutory members, in total we have eleven directors of which 4 are independent (40%) and 3 are women (30%). In the Annual Shareholders meeting that took place on April 7, 2022, it was approved to appoint the eleventh director afterwards.

  More information available here

• How often does the Board of Directors meet?

  The Board of Directors meets a minimum of four times a year. There were 4 sessions held throughout 2021 and the average attendance to these meetings was 85%.

  2021 Report, page 308

• Which are the main responsibilities of the Board of Directors?

  • Choose the President and CEO of the company
  • Work actively with top management to develop overall strategies for the company and its subsidiaries
  • Approve information and communication policies to shareholders and the market
  • Act as adviser/ consultant for top management of the company
  • Oversee the management of the company and its subsidiaries
  • Ensure that overall strategy is in line with the company’s principles of Corporate Responsibility 

  2021 Annual Report, page. 308

• Do you have an Audit Committee?

  Yes. Our Audit and Corporate Practices Committees is composed by five statutory Directors, all of them independent, and its primary responsibilities are:

  • Giving and opinion on the hiring and establishment of the fees of the independent auditors
  • Ensuring the existence of a proper internal control system for the company that meets any and all applicable accounting and legal provisions, and reviewing company and subsidiaries transactions with related parties
  • Reviewing the financial statements and ensuring they are a true and accurate reflection of the financial situation for the company. 
  • Reducing the risk of conducting operations such that could affect company worth or could result in the granting of favored conditions to any one group of shareholders
  • Approving policies for the use and enjoyment of properties pertaining to the net worth of the company
  • Authorizing transactions with related parties, remuneration for the Chief Executive Officer, and remuneration policies regarding relevant company officers
  • Serving as support for the Board of Directors in producing reports on accounting practices
  • Holding private meetings and receiving periodic reports from Internal Audit, Legal, Compliance, and Ethics
  • Calling Shareholders to meetings and ensuring that the order of business includes all matters deemed necessary

  2021 Report, page. 310

• How do you make sure all your associates comply with integrity standards?

  Our Code of Conduct establishes the guidelines for honest, fair, and objective decision making when operating regardless of where any of us works in full compliance with all corresponding laws and internal policies. Our Statement of Ethics applies to all associates, at all levels of the organization, around the world, and to all members of the Board and committees of the company. In addition, we expect all our suppliers, consultants, and contractors to adhere to our Statement, thus acting correctly and consistently.

  We provide mandatory annual training for our associates: In 2021, we gave over 52,304 hours of training in ourCode of Conduct for our operations and staff associates.

  We encourage our associates to feel free to express any concern, with the tranquility of knowing they will be heard. Different formal mechanisms for making a claim have been established whereby our associates may express their concerns or report unsuitable behavior, without the fear of facing any repercussions for having done so.

• How do you prevent corruption and bribery?

  Our Global Anticorruption Policy and the Global Anticorruption Procedures are a reflection of our commitment to maintain the highest standards in integrity and commitment, in keeping with all applicable legislation in the markets where we operate, through our Global Anticorruption Policy, and from our Global Anticorruption Procedures. By not tolerating any bribes, acts of corruption or dishonest practices of any nature, we are able to accomplish our objectives with full transparency. In the case our associates have any suspicion or information regarding the violation of company policies, or have data on improper requests, even though rejected, they must report them immediately to the Global Ethics contact points. Our associates receive mandatory online training in anticorruption, which must be taken each year. The Board of Directors also receive mandatory training once every year.

  We conduct annual risk evaluations to identify and assess risks associated with corruption to better assign the resources needed to tend to such matters. Our Continuous Improvement team regularly evaluates and implements the program and provides timely feedback, thus establishing the root-cause and providing the solution to identified situations. In addition, Global Internal Audit also conducts periodic and independent audits of our program.

• Do you have an information security program?

  Yes, the information security program was created to provide our brand portfolio worldwide with comprehensive, profitable, and risk-based security services.

  We guarantee protection for information and information systems against unauthorized access, use, dissemination, alteration, or destruction, thus providing confidentiality, safety, and availability. Our objective is to maintain company information safe through better understanding of this subject and guidelines by our associates and business partners. We also ensure best practices are followed to identify risks, protect information, detect suspicious activities and to be prepared to respond to future incidents.

  Our company has policies, standards, procedures, and security for information, with the purpose of regulating and raising awareness among our associates and suppliers concerning the importance of the information and the technological resources used in the company. We also provide mandatory training for our associates so they may better understand the importance of adopting behaviors in line with our information security guidelines.

  Our Audit and Corporate Practices Committees are committed to the strategy of information security, thus making the review process a fundamental part of their activities. A review is conducted every four months of all mitigation initiatives, trends, risks, and strategies. Furthermore, each market where we operate has its own information security leader who is also part of the committee that reviews and defines the cybersecurity strategy.

  2021 Annual Report, page 295