– The Wall Street Journal (paywall) reported that Macy’s delayed its quarterly results after the company found that an employee had hidden up to $154 mn in corporate delivery expenses over several years, prompting an investigation. Macy’s said a single employee, responsible for small-package delivery expense accounting, had intentionally made erroneous bookkeeping entries since late 2021. The individual didn’t take the amounts in question and the company declined to say how it uncovered the erroneous entries or how it went undetected by the company’s auditor, KPMG.
Macy’s said it would provide details on its investigation when it reports quarterly results on December 11. A KPMG spokesperson declined to comment.
The company said its internal investigation found that the employee had hidden $132 mn to $154 million cumulatively from the fourth quarter of 2021 through the most recent period. The company said it had recognized about $4.36 bn in delivery expenses over the same period.
– The SEC reported that it filed 583 total enforcement actions in fiscal year 2024 while obtaining orders for $8.2 bn in financial remedies, the highest amount in the agency’s history. The 583 enforcement actions represent a 26 percent drop in the total number of enforcement actions compared to fiscal year 2023.
The $8.2 bn in financial remedies consisted of $6.1 bn in disgorgement and prejudgment interest, also the highest amount on record, and $2.1 bn in civil penalties, the second-highest amount on record.
‘The division of enforcement is a steadfast cop on the beat, following the facts and the law wherever they lead to hold wrongdoers accountable,’ SEC chair Gary Gensler said. ‘As demonstrated by this year’s results, the division helps promote the integrity of our capital markets to benefit investors and issuers alike.’
– The WSJ reported that Walmart is ending some of its diversity, equity & inclusion (DE&I) programs, the latest big company to change tack on those issues. Walmart will wind down the Center for Racial Equity, a non-profit the company funded with $100 mn in 2020 for five years, and programs that provide assistance to suppliers that are 51 percent-owned by women, minorities, veterans or members of the LGBTQ+ community. Walmart will also stop allowing third-party sellers to offer some LGBTQ+-themed items on Walmart.com, a spokesperson said.
Walmart also said it would continue to phase out the term DE&I in company documents, as well as stop sharing data on its LGBTQ+ corporate policies with the Human Rights Campaign.
Some diversity-themed supplier programs were being phased out due to legal challenges of similar practices, a Walmart spokesperson said. The company will fulfill its existing five-year commitment to fund the Center for Racial Equity through 2025. ‘We are willing to change alongside our associates and customers who represent all of America. We’ve been on a journey and know we aren’t perfect,’ Walmart said in a statement.
– The Guardian reported that workers at a Whole Foods store in Philadelphia have filed to hold a union election, the first such filing at the supermarket chain since Amazon acquired it in 2017. ‘This company makes billions of dollars in profits every year,’ said Ben Lovett, a Whole Foods store employee in Philadelphia, who along with 300 colleagues is hoping to join the United Food and Commercial Workers. ‘And my coworkers and I are not paid anywhere near a living wage for living in Philadelphia. I’ve worked two jobs. Many of my coworkers do two jobs, even three jobs.’
Workers at the store had organized around safety issues at the beginning of the Covid-19 pandemic, said Lovett, but about a year ago workers began getting together to discuss unionizing in response to issues such as low pay, high workloads and intense productivity demands.
A spokesperson for Whole Foods said in an email: ‘Whole Foods Market recognizes the rights of our team members to make an informed decision on whether union representation is right for them. We agree with the overwhelming majority of our team members who value our open door policy and our ability to quickly respond to the needs of our workforce.’
– According to CNN, The Walt Disney Company has agreed to pay $43 mn to settle a lawsuit alleging that it paid female employees less than their male counterparts in similar roles for nearly a decade. The settlement agreement stems from a 2019 lawsuit filed by LaRonda Rasmussen. She claims she learned that six men with the same job title earned substantially more than her, including one man with several years less experience. About 9,000 women, who were both former and current employees, joined the lawsuit.
Disney disputed the allegations and didn’t admit fault. ‘We have always been committed to paying our employees fairly and have demonstrated that commitment throughout this case, and we are pleased to have resolved this matter,’ a spokesperson said.
As part of the settlement, Disney must hire a labor economist to analyze pay equity among full-time, non-union California employees below the vice president level for three years, and fix the differences, the law firms representing the plaintiffs said.
The settlement agreement requires approval by a judge.
– Subway CEO John Chidsey is retiring from the company at the end of the year, the WSJ reported. Chidsey has led the sandwich firm since 2019 and helped sell the chain to Roark Capital in a more than $9 bn deal last year. Subway said he will continue to consult for the chain, focusing on international expansion and signing deals with large global franchisees.
Carrie Walsh, Subway’s current president of Europe, Middle East and Africa, will serve as interim CEO while the company conducts a search for a permanent successor.
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
