A Critical Analysis of Business Ethics: Walmart's Corporate Conduct

This essay provides a comprehensive analysis of Walmart's business ethics, examining the company's unethical behaviors and actions. It begins with an introduction to business ethics and Walmart's background, including its vision, mission, and core values. The essay then delves into specific unethical practices, such as low wages, poor working conditions, gender discrimination, and a lack of corporate social responsibility. It explores the reasons behind these actions, linking them to the company's profit-oriented generic strategy and cost leadership model. Furthermore, the essay discusses the legal implications of Walmart's actions, citing relevant laws like the Equality Act, Health and Safety Act, and Fair Labor Standard Act. Finally, it suggests ways to improve Walmart's corporate culture and leadership, emphasizing the importance of employee well-being, effective communication, and transparency. The conclusion stresses the significance of maintaining ethical standards for organizational success and the negative consequences of unethical practices, using Walmart as a case study.

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Business ethics: Walmart
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Introduction
With the competitive business environment, a company must strive to influence, guide
and reinforce a strong organizational behavior. An organization must make every effort to align
itself to the accepted ethical principles and standards (Crane & Matten, 2016, pp. 85). By
observing business ethics in its operations, an organization can have a positive and significant
impact on the employees, society and the environment. Thus, an organization that maintains high
levels of ethical standards can gain a competitive advantage because it has a good reputation
among its shareholders (Hartman, DesJardins & MacDonald, 2014, pp. 31). Hence, any
successful company strives to observe business ethics in all its activities. However, there are
some organizations that engage heavily in unethical behaviors that highly affect its reputation
and the capability to attract investors. As a result, such companies can find themselves facing
legal actions due to violation of ethical standards, high employee turnover, low performance and
productivity as well as low revenues (Davies, 2016, pp. 121). Therefore, the paper covers the
unethical activities and behaviors by Walmart on its people and the consequences of such
unethical actions towards its operations.
About Walmart
Founded in 1962, Wal-Mart Stores is multinational retail company whose headquarter is
in US. The company is the world’s largest employer and it has several outlets across the world.
On average, Walmart has over 2.1 million associates across the globe and operates more than
8400 units within 15 countries where it has its branches (Walmart, 2018).

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Walmart’s Vision Statement
The company’s vision statement is: “To be the best retailer in the hearts and minds of
consumers and employees.” Walmart’s vision is anchored on the wellbeing of key people that
matter in any business, that is, the employees and consumers. The vision aims at influencing the
minds of both employees and consumers in terms of financial benefits. Hence, the basic
assumption is that the employees will benefit financially by earning wages and salaries while the
consumers will save money by buying from Walmart whose prices for the goods are generally
low (Walmart, 2018).
Walmart’s Mission Statement
The company mission statement is: “Saving people money so that they can live better.”
Walmart’s mission statement is directly derived from the company’s slogan which is “Save
Money. Live Better.” The company has indeed lived to fulfill its mission by offering their
products to consumers at low prices. Through that, consumer will save money that would be
used in buying the same product at a higher price from other outlets (Walmart, 2018).
Walmart’s core values
The company’s core values are: Respect for the individual, Service to the customer and
Striving for excellence. The three core values are used by the company in the efforts to fulfill its
mission and vision (Walmart, 2018).
Walmart’s unethical behaviors and actions
Despite its vision statement that seems to put the needs of the employees at heart,
employees’ treatment at the company has remained a major problem. Despite being the leading

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retailer in the world with over 2 million employees, the company has failed to develop a proper
labor policy for its employees. Employees are the main element of any company and their
management dictates the productivity of a company (Gamble, Thompson & Peteraf, 2013, pp.
101). As discussed earlier in the paper, an organization must be ethical to its employees. That
means that a company must strive to treat its employees within the established and acceptable
principles and standards. Although the company has struggled to offer products at low prices to
its customers, the value and rights of the employees have been underrated and undermined to a
greater extent.
One main cause of the poor employee treatment is the company’s generic strategy which
is profit-oriented. While seeking to maximize their earnings, the company has adopted a generic
strategy of cost leadership based on Porter’s model. In order to achieve that, the company has
focused on maintaining low prices for their goods and services. To succeed in that, the company
strives to reduce the cost of their operations which results to low wages for their employees
(Gamble, Thompson & Peteraf, 2013, pp. 101). Thus, in the process of implementing their
strategy, the company has settled on minimizing their expenditure in all their areas of operations
including the employees’ salaries. Therefore, most of the company’s unethical behaviors and
actions are on employees’ management and the environmental conservation as discussed in the
subsequent paragraphs (Jankalova, 2016, pp. 583).
The first unethical issue that the company engages in is low wages. As mentioned earlier,
the company strives to offer products to consumers at a relatively lower price. Hence, to achieve
that target, the company aims at reducing their costs of operations. By reducing their costs of
operations, the company ends up paying their employees lowly and poorly. As a result, the
employees end up living miserable lives since their low income cannot sustain their living

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standards. The company also exploits their workers who are forced to work overtime without pay
(Stave & Wald, 2016, pp. 95). The employees are normally supposed to work for 11 hours a day
and any extra hour the employee works should be treated as overtime and the company need to
pay them extra money. However, at Walmart employees are forced to almost 16 hours a day
without extra payment which leaves them exhausted. It is also unhealthy to work for such a
longtime without resting ( Sepinwall, 2015, pp. 525).
The other unethical issue that Walmart subjects their employees to is unconducive
working environment. The working environment at Walmart is so unhealthy. Mostly the
company deals with plastics and they use hot machines producing temperatures of up to 200
degrees centigrade (Boyle, 2015, pp. 53). As the company aims at minimizing the costs of
operations, they fail to offer the employees with the right protective equipment thus subjecting
them to a lot of danger. Thus, it is very unethical for people to work under such conditions. The
issue of gender discrimination is also rampant at Walmart. The company aims at employing
women only as they feel that they are easier to control and exploit. Almost 90% of employees at
Walmart are women which is unethical and against the law (Blossfeld, Skopek, Triventi &
Buchholz, 2015, pp. 75). The company has also failed to invest on CSR. Walmart deals with
plastics whose processing emits a lot of poisonous gases leading to environmental pollution.
Thus, the company has failed to invest adequately on ensuring that they remain friendly to the
environment.
Reasons why Walmart’s actions are illegal
Walmart has been very discriminative when offering job opportunities. It is argued that
the company discriminates between genders and employs more women compared to men. It is
illegal to discriminate people on basis on their gander or races when offering employment

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opportunities. According to Equality Act, “any company or institution that discriminates against
people based on the age, gender, disability or any other protected features will be acting against
the law and it is punishable.” (Blossfeld, Skopek, Triventi, & Buchholz, 2015, pp. 78). Thus, it
is illegal for the company to be selective when offering job opportunities.
Walmart has failed to consider the welfare of the employees in terms of their health and
safety within their places of work. The company does not offer the employees with the right
safety equipment to protect themselves from high temperatures emitted by machines. According
to the Health and Safety Act, “It shall be the duty of every employer, to ensure, so far as
logically practicable, the health Safety and welfare of all his employees.” (Boyle, 2015, pp. 50)
Therefore, it is illegal for a company like Walmart that fails to take into consideration the
welfare of its employees thus subjecting them to such dangers.
The company has also been paying their employees poor wages that cannot sustain their
lives. Walmart has also been overworking their employees beyond what is accepted by the law.
According to the Fair Labor Standard Act of 1938, “it is against the law to pay an employee
anything below the minimum, set wage of $7.25 per hour”. According to the same Act, “an
employee is expected to work for a maximum of 40 hours a week and any time beyond that
should be paid as overtime.” Therefore, it is illegal to overwork your employees and also illegal
to pay them anything less than the set minimum wage.
How to improve Walmart’s Corporate Culture and Leadership
In order to improve their corporate culture and leadership, Walmart Stores management
should create a corporate culture environment that is fun through holding of family days,
company outings to help the employee relax and also engaging in team building activities. The

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company should also consider living up to its vision of having the needs of employees at heart by
paying them well. Walmart should also encourage effective communication to help the
management get all the criticisms and employee grievances. The company should also encourage
high levels of involvement where the employees have the opportunity to give their views.
Walmart should also be fair, open and transparent in all that they do so that they do not become
unfair to the employees. The company should also be supportive of the employees’ goals and
ensure their welfare is taken care of. By undertaking such steps, Walmart can be able to foster a
good culture and leadership within the organization.
Conclusion
Maintaining ethical standards and principles within an organization is important. It
enables most organizations to treat their people, society and environment fairly and effectively.
As a result, the company can gain a competitive advantage since observing business ethics
encourages employees and other stakeholders to deliver for the organization. However, some
organizations like Walmart have failed to observe ethics leading to endless criticisms and legal
cases against them. Therefore, an organization should strive to remain ethical in order to
motivate its people and improve the performance and productivity of the company.

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References
Blossfeld, H. P., Skopek, J., Triventi, M., & Buchholz, S. (Eds.). (2015). Gender, education and
employment: an international comparison of school-to-work transitions. Edward Elgar
Publishing, pp. 65-89.
Boyle, T. (2015). Health and safety: risk management. Routledge, pp. 45-60.
Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press, pp. 78-90.
Davies, P. W. (2016). Current issues in business ethics. Routledge, pp. 112-130.
Gamble, J. E., Thompson, A. A., & Peteraf, M. A. (2013). Essentials of strategic management:
The quest for competitive advantage. McGraw-Hill/Irwin, pp. 92-110.
Grayson, D., & Hodges, A. (2017). Corporate social opportunity!: Seven steps to make
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Hartman, L. P., DesJardins, J. R., & MacDonald, C. (2014). Business ethics: Decision making
for personal integrity and social responsibility. New York: McGraw-Hill, pp. 23-40.
Jankalova, M. (2016). Approaches to the evaluation of corporate social responsibility. Procedian
Economics And Finance, 39(3), 580-587.
Sepinwall, A. J. (2015). Denying corporate rights and punishing corporate wrongs. Business
Ethics Quarterly, 25(4), 517-534.
Stave, G. M., & Wald, P. H. (Eds.). (2016). Physical and biological hazards of the workplace.
John Wiley & Sons, pp. 89-100.

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Walmart. (2018). Company Facts. Walmart. [Online]. Retrieved from: <
https://corporate.walmart.com/newsroom/company-facts > [Accessed 17 May 2018].