Last month’s impressive Black Friday protests at a reported 1,000 Walmart stores highlight the growing movement against the company’s low wage culture. As the nation’s largest private employer, Walmart has done more than any other company to reinforce income inequality. With an average wage of $8.81 per hour, Walmart keeps its labor expenses low by encouraging its employees to rely on charity and sign up for federal benefits such as Supplemental Nutritional Assistance (SNAP).
The corporation’s impacts on the food system are no less troublesome. It has been at the center of the nation’s cheap food structure, forcing a globalization and industrialization that is grounded in a race to the bottom for labor and environmental standards. It has driven out of business an untold number of small food retailers, which were once the heart and soul of community food systems across rural America.
Even in its highly promoted initiatives to sell more local and organic food, Walmart’s procurement practices have often forced greater consolidation in the marketplace, essentially providing a counter-weight to the local food movement.
Now, in a disturbing trend, an increasing number of food and farming nonprofits are relying on the Walmart Foundation to fund their programs. The Milwaukee–based urban agriculture leader Growing Power paved the way when it accepted a seven-figure grant from the Foundation in 2011. Since then, FoodCorps, a service corps program focused on educating kids about healthy food, and the food hub pioneer National Good Food Network (NGFN) have both followed suit.
Neither Food Corps nor NGFN staff responded to our request for comment on their rationales for accepting Walmart funding. In Growing Power’s blog from 2011, however, Will Allen argues: “We can no longer be so idealistic that we hurt the very people we’re trying to help. Keeping groups that have the money and the power to be a significant part of the solution away from the Good Food Revolution will not serve us.”
We’ve been party to discussions within one unnamed national organization as it decides whether to apply for a $1.5 million grant from Walmart Foundation. In those considerations, we’ve heard crop up one common misconception. Those in favor of accepting Walmart’s money rationalize that the Walmart Foundation and Walmart, Inc. are separate entities. They believe that accepting Walmart Foundation money is not akin to aiding and abetting Walmart.
Nothing could be further from the truth: The Walmart Foundation is Walmart.
First, a bit of context. The gap between corporations and corporate philanthropy has never been narrower. Once upon a time, corporate charity was about expressing a company’s commitment to the communities that it served and about defining its role as a civic leader. But as the value of a company’s brand has become more central to its stock price, managing public perception has taken on greater importance. With that change, corporate charity is no longer a garnish, an optional nicety, but instead sits at the center of the corporate plate, an integral element of a firm’s core business strategy.
As with so much of what it does, Walmart’s approach is much more targeted and brazen than virtually any other company’s giving. It transcends garden-variety reputation-cleansing corporate philanthropy. And the Walmart Foundation and Walmart, Inc. function as a single unit unlike any other corporation and foundation, often using philanthropic donations to push its expansion in urban areas, from which it has been shut out because of labor and environmental concerns. In these cities, Walmart softens up the opposition with a veritable flood of donations.
For example, in Boston, the Foundation increased its grantmaking four-fold in conjunction with a campaign to build new stores. Similar increases were seen in Seattle, Los Angeles, and Chicago. The donations are accompanied by intensive public relations and lobbying campaigns to build new stores in such neighborhoods as Los Angeles’ Chinatown.
The donations are intended, according to Occidental College Professor Peter Dreier, as “honest graft,” a term coined in the 19th Century to mean using one’s political and business connections to make a fortune. This is hardly the altruism that Walmart Foundation purports as its grantmaking motivation.
In New York City, this conflict rose to the surface this June, when a majority of New York City Council members signed a letter to Walmart demanding that the Foundation cease making grants there. They wrote: “We know how desperate you are to find a foothold in New York City to buy influence and support here.”
On occasion, the less-than-altruistic nature of these donations shines through. According to one New England-based leader we’ve heard from, former Walmart Foundation President Margaret McKenna once told new Boston-area grantees that she expected that they would ask former Mayor Thomas Menino to drop his resistance to allowing the company to build new stores in Boston. When one of these grantees failed to do so, their grant was not renewed.
The Foundation and the company’s unity also comes across quite clearly when you look at the revolving door between the two entities. Many of the most senior level corporate executives at Walmart, Inc. sit on the Foundation’s Board, underscoring its importance to corporate strategy. Eight of the nine members of the Foundation’s board of directors are current or retired executives in the company, including the chief operating officer of Walmart US, a former CEO, and three executive vice presidents.
The Foundation structures its public relations efforts to clearly benefit the company. After the Walmart Foundation granted multi-million dollar donations to the Food Research and Action Center and Feeding America, the company’s Executive Vice President Leslie Dach and lobbyist Tres Bailey participated in plenaries at the 2010 and 2011 National Anti-Hunger Policy Conferences sponsored by the two organizations. There they sought to establish the company as as a hunger fighter, and take attention away from their low-wage policies.
Similarly, when Food Corps and Growing Power received funds from the Walmart Foundation, they issued joint press releases, putting the Walmart company name and logo on their websites, providing a direct link to the Walmart website.
The seamless nature of the Walmart Foundation and Walmart, Inc. makes it challenging if not impossible to distinguish between these two entities and the purposes that they serve. Any good that organizations do with Walmart Foundation money is offset by the way in which their grants reinforce the company’s egregious practices.
We empathize with the plights of these organizations as they struggle with whether to accept what can be enormous amounts of money. Fundraising is always challenging, especially when it comes to the large grants that Walmart is able to offer. It can take a clear understanding of the pros and cons of these grants to forego the opportunities provided by millions of dollars.
Yet, we encourage food and farm groups to weigh the political implications of their fundraising practices. It is not enough to consider how a grant benefits a single organization’s programs, no matter how valuable that work may be. What is good for one organization may not be good for the food movement as a whole. We must all start acting as a coherent social movement if we are to ever have a chance of reaching our common goals of creating a sustainable, just, and healthy food system.