CareNetWest Companies, Inc. is a new public healthcare company, which is facing several risk management challenges, including implementation of the requirements of the Sarbanes-Oxley Act of 2002 (SOX). The company recently lost its Chief Risk Officer and is not prepared to implement corporate governance and SOX requirements or best practices.
Also, CareNetWest has neglected to implement regulatory risk processes to address these corporate compliance issues and also lacks the internal expertise necessary to mitigate them. Specifically, the company lacks internal experience, communication skills and compliance of SOX. Wal-Mart is one of the world's largest and wealthiest retail stores. Similar to CareNetWest, however, they face corporate compliance issues of all sorts. Some of these issues have been brought against the corporation as lawsuits.
The majority of the cases have concerned labor conditions and wage and hour violations. Wal-Mart has reportedly been in violation of labor laws. Also, according to store associates, they are being paid unfairly below minimum wage without enough money to make a living and were also forced to work overtime. Wal-Mart, like CareNetWest was lacking the internal expertise necessary to mitigate its issues. Without the proper support teams on board to solve their issues, the structure of both companies is weak.
Over the years, and after hundreds of lawsuits filed mostly by its associates, Wal-Mart has implemented new policies and a corporate compliance team to help better its reputation as a business.
Issues According to Human Rights Watch online, "Interviews with Wal-Mart workers and managers, legal filings, and other relevant documents make clear that concerns over working conditions at Wal-Mart are wide ranging. They include not only the systemic hostility to worker, but also wage and hour violations, illegal sex and disability discrimination, claims of inadequate healthcare coverage and wages, and the perceived elimination of long-term workers," (hrw.org).
Wal-Mart has been accused of forcing associates to work off the clock, denying associates their lunch and rest breaks, having a heath care plan that only covers some of its employees, paying associates below minimum wage, poor treatment of factory workers, having an anti-union policy, violating child labor laws, and discrimination against women, gays, bisexuals and transgender individuals.
Overall, Wal-Mart has faced a horrible reputation as a business because of the vast amount of its associates who are unsatisfied. Without the proper internal expertise or support groups and management teams on board, the company's reputation seemingly grew worse because it appeared not to have any way to mitigate its issues.
Solutions Wal-Mart made drastic changes in order to address the legal issues it was facing. In 2004, it established a corporate compliance team to address U.S. wage and hour laws and lawsuits. Wal-Mart also created an Office of Diversity to implement programs concerning diversity and put an end to discrimination accusations. It adopted a new job classification system to consider pay and promotions. This would hopefully curb questions about gender discrimination.
The corporate compliance team is assigned to handle the company's obligations and duties to employees such as pay, working hours and break time. New cash registers were installed, which would cut off if an associate works beyond scheduled hours. Wal-Mart also increased hourly wages to almost ten dollars per hour. With the new corporate compliance and Office of Diversity team on board to repair the company internally, the vast amount of lawsuits should hopefully decrease or stop altogether.
Outcome The company's corporate compliance and Office of Diversity team have turned things around for them, and pulled their soggy reputation out of the water in the past three years. Because of this, Wal-Mart remains a leader in the retail industry.
Is Wal-Mart good for America? Frontline. Retrieved on December 2, 2007 from http://www.pbs.org/wgbh/pages/frontline/shows/walmart/transform/employment.html. Defending Human Rights Worldwide. Human Rights Watch. Retrieved on December 2, 2007 from http://hrw.org/reports/2007/us0507/5.htm#_Toc164069651. The real facts about Wal-Mart. Wake Up Wal-Mart. Retrieved on December 2, 2007 from http://www.wakeupwalmart.com/facts/.