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Unformatted text preview: ple crises of unemployment, deepening poverty and worsening inequality, a high
powered presidential commission of enquiry must be established with immediate effect
to investigate; one, the severity of the impact of this deal on the South African economy,
the severity of the impact of this deal on employment, local business and local
The Government proposed a social dialogue between Wal-Mart, Massmart and
interested parties (trade unions and the government) to agree on a set of commitments
that would ameliorate public interest concerns resulting from a merger. In particular the
government was concerned with the impact of the entry of Wal-Mart on local suppliers
as Wal-Mart shifts to exports. When the social dialogue failed to produce the desired
results, the government challenged the merger before the Competition Tribunal. The
government was not happy with the Competition Tribunal decision and then challenged
it before the Competition Appeal Court by way of a review.
Parliament held public hearings on the entry of Wal-Mart into South Africa. Some less
significant stakeholders, such as the opposition parties in parliament, the Democratic
Alliance and the Freedom Front Plus, business publication editorials, and smaller trade
unions voiced their support for the merger. 65 Table 6: Summary of Results for Research Question 3 – Stakeholder Reaction Stakeholder
Government Reaction Trade Unions Made submissions before competition authorities (All) Parliament
Tribunal Appointed an advisory panel
Called a social dialogue between stakeholders
Intervened at the Tribunal seeking remedies or
Made submissions in parliament
Reviewed the decision of the Tribunal in court.
Issued press statements Staged a picketing at the Tribunal during hearings
Made submissions in parliament
Filed a notice for a national protest by all COSATU
Called for a Commission of Inquiry on the impact of
the entry (NUMSA only) Called for public hearings Approved merger subject to creation of R100 million
supplier fund, honouring of existing agreements with
trade unions and first consideration of retrenched
employees should vacancies arise. 5.3.4 How did Wal-Mart manage the main stakeholders when entering South
There is no discernible stakeholder plan and execution for Wal-Mart on its entry into
South Africa. Wal-Mart itself has not played much of a role in talking to stakeholders;
most of this has been undertaken by the target, Massmart. Even Massmart itself did not
appear to be doing so proactively and in pursuit of any particular strategy. The meetings
with ministers were called by the government, who also instituted the social dialogue.
However, Massmart used the media to explain its ‘side of the story’. At one point it
66 issued a statement in response to a government statement. Its media statements were
issued by a public relations firm and are responsive to issues raised about the entry of
Wal-Mart. There appears to be an effort to reach out to the public, the media and other
stakeholders, through the media. In one article the Chairman of Massmart explained
“Why we did it [sell to Wal-Mart]”, while in another, a short statement was issued
clarifying that reports that one of its stores, Makro, had stopped buying locallymanufactured olive oil in favour of imports, were inaccurate, and that, in fact, the
opposite was true – it had never stocked locally-manufactured olive oil until recently.
During the period under review, Massmart issued about ten media releases on the
Formal stakeholders such as the Competition tribunal were engaged through the formal
legal process. Only at the last minute did Wal-Mart and Massmart give gave
concessions and offered to create a R100 million supplier development fund, maintain
the existing agreements with trade unions for a period of three years and to e-employ
the retrenched workers when there are vacancies.
5.3.5 What were the outcomes of Wal-Mart’s management of the main
stakeholders on entry into South Africa?
It is still too early to examine the outcomes of Wal-Mart’s stakeholder engagement as
the entry is very recent and on-going. However, in the short term, the relationship
between the government and trade unions on the one hand and Wal-Mart on the other
hand, is adversarial and is mediated by courts through litigation. At the time the research
was conducted, it appeared to be a ‘war of attrition’ with both the unions and
government attacking the merger in the Competition Appeal Court. Media reports show
that attempts by the presiding judge to have the parties reach an agreement failed. 67 5.4 Conclusion of the Results The results show that the key stakeholders of Wal-Mart’s entry into South Africa are the
government and trade unions. The results also show that Wal-Mart left much of the
stakeholder engagement to the target, Massmart, and only involved themselves with
stakeholders at a superficial level. The k...
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- Winter '14