Jack Welch, wife scrutinize Walmart scandal

Jack and Suzy Welch on "CBS This Morning."
Jack and Suzy Welch on "CBS This Morning."

(CBS News) General Electric's former chief executive officer Jack Welch and his wife Suzy Welch have taken a particular interest in a Walmart scandal unfolding over claims that the company paid bribes in Mexico and then covered up its own investigation.

The Welches, who published an op-ed for Reuters about the case, said Wednesday on "CBS This Morning" they've taken an interest because of the attitude often taken by American corporations toward whistle blowers.

The Wal-Mart mess: Everybody does it (and we don't mean bribery)

"Companies, because of experience with whistle blowers, have a strong inclination to shut every whistleblower down because they've heard it before, they think the person is damaged goods and that is what appears to have happened at Walmart," Suzy Welch said. "We think the Walmart story is just a wake-up call to any company that has a whistleblower come forward. Of course, you've got the gut instinct to write the whistleblower off, to shut them down, to ignore them, but don't do it."

Jack Welch added that companies need to separate the whistleblower from his or her message. He said, "Don't investigate (the claims) with the same people. You've got to have a compliant system that absolutely looks at every one of these claims with vigor. I mean, look at the Secret Service issue; they're investigating themselves again. It's a crazy system where people are investigating themselves."

The New York Times published an investigative report last week, making the case that the Bentonville, Ark.-based company's subsidiary directed payments of as much as $24 million to mayors, city council members and other officials to secure construction permits and avoid environmental concerns as it built new stores in Mexico.

Walmart could be found in violation of the U.S. Foreign Corrupt Practices Act, which forbids U.S. companies from bribing foreign officials. The U.S. Department of Justice has begun a criminal investigation into the claims, and Mexican federal authorities say they will scrutinize public officials' involvement.

Jack Welch was the chief executive officer of General Electric for 21 years and is the founder of the Jack Welch Management Institute at Strayer University. Suzy Welch is an author, speaker and the former editor of the Harvard Business Review.

For more with Jack and Suzy Welch, watch the video in the player above.