INSUBCONTINENT EXCLUSIVE:
Many Flipkart employees and other observers found Walmart's action confusing.The surprise resignation of a tech billionaire has pulled
corporate India deeper into the #MeToo firestorm that's been sweeping through the American business community for more than a year
announced Tuesday that Flipkart co-founder Binny Bansal was leaving the company after an independent probe into allegations of sexual
While Bansal denies any wrongdoing and the investigators didn't find evidence of assault, the process revealed "lapses in judgment" that
troubled the parent company's leadership.By buying Flipkart, Walmart made Bansal a billionaire and a national icon
By forcing his resignation, the company turned him into an example of the kind of zero-tolerance corporate policy that's come to be expected
in the US, where the #MeToo movement has brought consequences for dozens of CEOs and senior leaders in business and finance.Many have been
fired, resigned or otherwise sidelined
American companies have been called on to articulate and, in many cases, strengthen their sexual harassment policies
Investors have begun to consider sexual harassment risk when allocating capital.India's own #MeToo movement exploded this fall, and it's
A handful of prominent men in entertainment and in government -- executives at local units of Dentsu Aegis and Fox Star Studios; a minister,
MJ Akbar -- have faced professional consequences
But corporate leaders have remained largely untouched.Walmart's dismissal of Bansal is significant, said Zoe Kinias, a Singapore-based
professor at INSEAD business school, because it sends a clear signal to the country's top executives: "There are consequences for these sort
of actions.""I'm not sure that global businesses handle these situations perfectly but they have processes in place," she added.Many
Flipkart employees and other observers found Walmart's action confusing
Bansal denied any sexual assault, and the company's internal investigation agreed
But the executives in Bentonville thought the angry accuser represented a business risk, and they wanted to know why Bansal hadn't disclosed
At Flipkart, that information would have been considered personal.Culture clash is inevitable when one company buys another
But as multinational companies increasingly look to grow in India -- often by acquiring or buying stakes in local companies like Walmart did
- it may put additional pressure on corporate India to strengthen its own policies and practices with respect to sexual harassment, in and
outside of the office.Many Indian businesses will have a steep learning curve ahead, said Kannan Ramaswamy, a professor at Arizona State
University's Thunderbird School of Global Management
He specializes in management strategy in India
"We don't have the mechanisms in place to really drive this problem out with the haste that it has to be done," he said
"The awareness is not there, the legal infrastructure is not supported and you're fighting against the weight of tradition and culture."A
former Flipkart employee contacted Walmart executives in late July and accused Bansal of sexual assault, according to a person with
knowledge of the matter, who requested anonymity because details aren't public
Investigators concluded Bansal and the woman had a consensual affair, the people said.Walmart completed its $16 billion purchase of a
majority stake in the e-retailer in August, a transaction that lifted Bansal's net worth to $1 billion
"While the investigation did not find evidence to corroborate the complainant's assertions against Binny, it did reveal other lapses in
judgment, particularly a lack of transparency, related to how Binny responded to the situation," Walmart said in a statement, without
detailing the nature of the allegations.Walmart's reaction reflected not only the influence of #MeToo in the US but the company's own desire
to shore up the squeaky-clean image it cultivates
So far, it's avoided public accusations of sexist behavior in its senior leadership, though store workers over the years have alleged
harassment by line managers
But with few women in senior leadership roles and its treatment of rank-and-file workers, Walmart also has been a target of criticism for
labour unions and activists over the years.Lately it's tried to burnish its reputation, investing millions to raise wages, expand benefits
and create more opportunities for women and minorities, and hiring public-relations chiefs who have worked in the Clinton and George W
Bush presidential administrations.The company has also strengthened its ethics and compliance department in the wake of a globe-spanning
investigation into allegations of corruption at the retail giant
For six years, US authorities have probed whether Walmart bribed government officials in countries including Mexico, India and China over
the course of a decade in order to fast-track store openings.
