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With no actual Corporate Social Responsibility (CSR) program in place to introduce the Wal-Mart Statement of Ethics, which was required by the New York Stock Exchange (NYSE) for Wal-Mart to go public, the company floundered and alienated entire local and regional governments in Germany, ceasing labor unions to sue them to stop the Statement of Ethics from being enforced (Talaulicar, 2009). German workers, when handed the Statement of Ethics, immediately went to their labor union leaders, who quickly filed a complaint with local government authorities. The German unions claimed the Statement of Ethics was against the German Works Constitution Act (Talaulicar, 2009).
Conclusion
If Wal-Mart had actually defined a thorough Corporate Social Responsibility (CSR) Program to launch the Statement of Ethics in Germany, taking the time to include more of the cultural and legal aspects of the country, they would have increased the odds of their...
Instead, Wal-Mart charged ahead with the distribution of the Statement of Ethics, not thinking of the ramifications on the cultural and legal relationships they had with thousands of employees in Germany. The result was a major public relations disaster, in addition to a series lawsuits and the eventual exit of the country. The lack of a CSR plan at one point cost Wal-Mart up to $200M a day in operating costs (Talaulicar, 2009). Clearly, having a good CSR strategy in place that reflects cultural and legal considerations can save literally billions of dollars a year for any firm pursuing global expansion.
References
Christopherson, S. (2007). Barriers to U.S. style lean retailing: The case of wal-marts failure in germany. Journal of Economic Geography, 7(4), 451-469.
Talaulicar, T. (2009). Global retailers and their corporate codes of ethics: The case of wal-mart in Germany. The Service Industries Journal, 29(1), 1.
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