The New York Times recently discovered that Wal-Marts in Mexico have been using bribery to further its expansion since 2005. The paper trail connected with Wal-Mart de Mexico bribery actions has totaled more than $24 million. The bribes allowed Wal-Mart de Mexico to expand quickly, changed zoning maps, removed environmental objections and diminished the life span of permits necessary for building. As a result of these activities, the organization was able to accelerate growth in Mexico. It has been noted that top executives knew about the payments and hid the evidence from Wal-Mart’s headquarters located in Bentonville, Ark. Wal-Mart de Mexico was basically purchasing market dominance in various locations.
According to the master list of reputation repair strategies, Wal-Mart’s response falls under the excuse strategy. When applying the excuse strategy the organization denies its intent to do harm that ultimately prompted the crisis; thus minimizing the organizations responsibility. Along with the excuse strategy, several subsets follow along including: provocation, defeasibility, accidental and good intentions. In this particular instance, Wal-Mart used a combination of defeasibility and good intentions. Defeasibility is when the organization claims to have limited information of events that eventually led to the crisis. A good intention is when the organizations goal was to do well.
Wal-Mart stated that it takes the U.S. Foreign Corrupt Practices Act (FCPA) very seriously and are devoted to containing an effective global anti-corruption program in all of the countries the company operates in. Noncompliance with the FCPA will not be tolerated in the company. Wal-Mart stresses the bribery took place six years ago and the organization does not pertain all the necessary information on exactly what took place, but a detailed investigation is being conducted.
The crisis strategy that Wal-Mart used is hard to swallow. It is very hard to accept that a company as large as Wal-Mart had no inquires as to how its Mexico branch was accelerating so quickly. This has been allowed to conduct for six years and the amount of money that was moved is vast. The response given was apologetic, but also defensive. The response began with the organization stand on the FCPA and how noncompliance will not be tolerated. Then the response turned defensive by repeatedly remarking that this occurred six years ago and that a full investigation is necessary to determine what really occurred in Mexico. I just felt that Wal-Mart was angry that it was being scrutinized. The wishy-washy template for the response decreases faith in the organization. At this moment it is hard to determine whether or not this will ever be resulted or if Wal-Mart will continue to sweep this occurrence under the rug.