Retailer says move isn't linked to store closures, recent food scandals

BEIJING - US retail giant Wal-Mart Stores Inc announced Monday that Wal-Mart China's President and Chief Executive Officer Ed Chan resigned, after its recent store closures and food scandals.

"Wal-Mart announced today that effective immediately, Scott Price, president and CEO of Wal-Mart Asia, will also serve as interim leader for Wal-Mart China, replacing Ed Chan, president and CEO of Wal-Mart China, who is leaving the company for personal reasons," the company said in an e-mailed statement on Monday.

The company also announced the resignation of Clara Wong, senior vice-president, Wal-Mart China's human resources department.

In China, Wal-Mart has closed some stores, and it is under investigation regarding accusations that it labeled ordinary pork as organic in the southwest city of Chongqing. In the same region, Wal-Mart was also accused of false advertising and selling of expired or uninspected food.

The company said that Chan's resignation was not connected to the store closures and pork-labeling probe.

Chan's departure follows several executives' leaving Wal-Mart's Chinese operation this year - Rob Cissell, former chief financial officer, in May, and Shawn Gray, former vice-president of Wal-Mart China's hypermarket operation, in June.

"The recent changes in our management level and the promotion of local staff are aimed at localizing personnel," said Chan in an earlier interview with China Daily. "And we are confident that the mix of Wal-Mart global talents and strong local leaders will guide the company to further success in this booming market."

The world's largest chain retailer by sales and revenue entered China in 1996, and Chan took over as Wal-Mart China's president and chief executive officer in 2007, when the retailer had more than 70 stores and 30,000 employees in China.

"Since 2007, Wal-Mart China has been maintaining double-digit growth, and now, four years later, we have more than 300 stores and 95,000 employees in the country," Chan said earlier in the same interview.

Wal-Mart said that as of Oct 1, it had 353 units in 130 cities and had created about 100,000 job opportunities across China.

Though it expanded quickly in the country, it has had to compete with increasingly sophisticated Chinese retail conglomerates as well as international counterparts such as France-based Carrefour Group, the UK's Tesco PLC and German retailer Metro AG.

During Chan's tenure at Wal-Mart, the company announced it had acquired a 35 percent stake in Trust-Mart Group in 2007, one of the biggest chain retailers in southern China. Wal-Mart also established an e-commerce office to oversee its online retail operations in the country.

In addition, Wal-Mart purchased a minority stake in the Chinese online retailer Yihaodian. These moves were made to further strengthen the retail giant's presence in China.

"The company appreciates Chan's close to five years of service ... and the China management team will continue to lead Wal-Mart's expansion and will continue to save Chinese customers money so that they can live better," the statement said.

China Daily

(China Daily 10/18/2011 page13)