Wal-Mart to clamp down on supplier ethics

Wal-Mart, the American retail giant, is to adopt a

zero tolerance approach for those that violate its global sourcing standards, the Wall Street Journal reported.

The company said it would soon begin severing ties immediately with suppliers who were found to be subcontracting work to other factories without its knowledge.

The move comes after clothing for the company was found to be being made at a Bangladesh factory where a fire killed over 100 people in November. Wal-Mart said that the factory was no longer supposed to be making its clothes.

The changes will come into effect on March 1 and replace the previous “three strike” policy where suppliers were given three chances to correct problems before having their contracts terminated, the newspaper reported.

Other initiatives will see the retailer publishing the names of factories that aren’t authorized to do business with its suppliers on its corporate website, while factories will also be required to pass pre-approval audits before suppliers are allowed to work with them.