State Treasurer Laura M. Montoya
STATE News:
SANTA FE — New Mexico State Treasurer Laura M. Montoya has upgraded Walmart, Inc. from the State Treasurer’s Office (STO) investment “Caution List ” to “Buy” status, after previously expressing serious concern regarding the February 2023 New York Times investigative report by Hannah Dreier that companies may be profiting from the use of U.S. suppliers that illegally employ underage migrant children.
“Companies that turn a blind eye to state and federal laws pose serious legal and regulatory risks that negatively affect investors,” Treasurer Montoya said. “As a fiduciary of New Mexico taxpayer dollars, I am committed to ensure that investments made by my Office are safe and in the best interests of the people of New Mexico.”
Treasurer Montoya made the decision to upgrade Walmart to Buy status following several meetings in recent months between high level representatives from Walmart and STO. Walmart has committed to increase its standards and auditing processes with respect to its suppliers, ensure that its suppliers fully comply with child labor laws, and pledged to take action against any supplier found to have violated child labor laws.
In March 2023, Treasurer Montoya sent letters to Amazon, PepsiCo and Walmart, placing each company on the “Caution List,” urging the Companies to conduct a risk-based assessment to identify any additional domestic suppliers that may employ underage migrant children. The Treasurer asked each company to identify the specific steps taken to address the allegations, policies implemented to prevent similar incidents from occurring in the future, and ceased further investing with the Companies until the requested deliverables were received. Conversations between PepsiCo executives and the State Treasurer are ongoing. Both Amazon and PepsiCo remain on the “Caution List”.
“We are waiting for deliverables and an update on the completed internal investigation from PepsiCo,” stated Deputy Treasurer JR Rael said. “Amazon has met with the Treasurer regarding her concerns and requested deliverables but has not been as receptive to providing the requested information or otherwise addressing the allegations.”
A copy of the letter to Walmart, Inc.:
Dear Mr. Serghini,
Following meetings in recent months between representatives from your company and my Office, I have made the decision to remove Walmart, Inc., from my Office’s investment caution list and upgrade Walmart’s status to Buy. I have made this decision based on Walmart’s stated commitment to ensure that its suppliers fully comply with child labor laws, its heightened standards and auditing processes with respect to its suppliers, and its pledge to take action against any supplier found to have violated child labor laws.
As a fiduciary of New Mexico’s state funds, it is critical that our investments not only have safety, liquidity, and yield, but also that our investments are made in partnership with investors that comply with state and federal laws. I appreciate Walmart’s continuous effort to work with the New Mexico Office of the State Treasurer in connection with the issues raised in the New York Times investigative report. Moving forward, I trust that your company will continue to honor its commitment to eliminate violations of child labor laws, hold suppliers accountable, and develop policies, procedures, and trainings that align with the law. I also trust that any investments made by my Office in your company are safe and in the best interests of the people of New Mexico.
Respectfully,
Laura M. Montoya
New Mexico State Treasurer