A year after suffering a major accounting scandal, Dutch retailer Ahold has vowed to set new standards in corporate governance and performance, and has also said it is considering claims against three former executives of its US Foodservice unit.
Speaking at a special shareholders meeting on corporate governance, Ahold CEO Anders Moberg said last year’s financial scandal, in which accounting irregularities led to a massive overstatement of profits, was the result of poor controls, and “the misguided actions of a handful of individuals”, rather than wholesale company-wide corruption.
The company said it has dealt with those individuals who were found to have been involved. A total of 39 executives and managers have been removed from the company and 60 have faced disciplinary action of different degrees, Moberg said.
Moberg warned that the aftermath of the scandal would continue for some time, as the company awaits the findings of investigations and other proceedings, including those by the SEC, the US Department of Justice, the Dutch Prosecutor and class action lawsuits.
Moberg said Ahold’s divestment and restructuring programme is on track. Last month, the company put its Bruno’s and BI-LO US retail chains up for sale. Ahold is in the process of selling its Spanish operations and its hypermarkets in Poland. On Monday the company announced the sale of Bompreco in Brazil to Wal-Mart and yesterday [Wednesday] it announced the sale of CRC Ahold in Thailand.
Peter Wakkie, Ahold’s chief corporate governance counsel, said the company was considering claims against three former executives of its US Foodservice unit, which was at the centre of the company’s accounting scandal.
Wakkie said it would seek to hold former US Foodservice CEO James Miller, together with two other former executives, Mark Kaiser and Timothy Lee, liable for damages at US Foodservice, reported the Washington Post. The company is also seeking to reclaim some or all of the three executives’ 2000 and 2001 bonuses.