Wal-Mart Stores Inc. is paying a former advisor to President Clinton at least $3 million over the next two years to direct a rapid-response team to handle mounting criticism of the world’s largest retailer.
In a regulatory filing Tuesday, the company disclosed the payment in stock -- plus additional stock options -- to Leslie Dach, a former Democratic Party political operative with wide-ranging communications duties during the Clinton administration.
Dach’s hiring and salary highlight the importance that Wal-Mart has placed on improving its image. Dach officially joined the company’s payroll this month as executive vice president of corporate affairs and government relations, reporting directly to Chief Executive H. Lee Scott.
In taking the job, Dach touted the company’s improvements on environmental and healthcare issues -- subjects of continuing and intense criticism.
“The changes are real and substantial steps for the business,” Dach said. “I look forward to working with Wal-Mart and its senior management to continue on its path of change.”
But critics of Wal-Mart call the changes cosmetic, pointing to wages they say are barely above the minimum wage and healthcare plans that offer catastrophic, rather than comprehensive, coverage.
The anti-Wal-Mart group WakeUpWalMart.com, funded by the United Food and Commercial Workers union, was quick to criticize Dach’s pay package -- noting that because the company has not disclosed Dach’s base salary, his total compensation is even higher.
“It’s outrageous and disgusting that Wal-Mart finds millions of dollars to pay its executives like Dach but seemingly doesn’t have the money to provide affordable healthcare and good wages to its workers,” a spokesman for WakeUpWalMart.com, Chris Kofinis, said Tuesday.
Dach had been working for the company for the last year as head of a 35-member group of public relations experts from global firm Edelman, which runs Wal-Mart’s Washington lobbying and communications operation.
In Tuesday’s filing with the Securities and Exchange Commission, Wal-Mart disclosed that Dach would be awarded a stock grant of 67,522 shares that would vest over the next two years. At Tuesday’s closing share price of $44.49, the grant would be worth just more than $3 million.
In addition, Dach was given 168,805 stock options, with an exercise price of $44.43, which vest in stages over the next five years.
That means that if the stock -- which has a 52-week high of $50.87 -- were to rise to $50 in two years, Dach would be entitled to sell for a profit of more than $376,000.
Wal-Mart and Dach could not be reached for comment Tuesday night.
Wal-Mart has sharply stepped up its efforts to mount a counteroffensive to unions and other groups whose criticism has grown louder and more organized during the last 18 months.
The company’s new initiatives include forming partnerships with environmental groups, such as Environmental Defense, which said recently that it would open an office near Wal-Mart’s Bentonville, Ark., headquarters.
Wal-Mart also has made other high-profile hires, including adding to its outreach ranks Harriet Hentges, a former nun who worked with the United States Institute of Peace.
In his role as an outside consultant, Dach worked to soften the company’s image and boost its standing with Wal-Mart supporters, launching the advocacy group Working Families for Wal-Mart.
Until two weeks ago that group was headed by former civil rights leader and U.N. Ambassador Andrew Young -- a coup for a company trying to woo African American civic leaders and urban customers.
Young, however, resigned from the group after telling the Los Angeles Sentinel that Jewish, Korean and Arab shop owners deserved to be replaced by Wal-Mart stores because they “ripped off” African American customers by overcharging them for spoiled goods.
Dach, who has worked for Environmental Defense, also served as a senior advisor to the Democratic National Committee.