Wal-Mart tightens supplier policy after factory fire: Wall Street Journal
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Wal-Mart Stores Inc plans to cut ties immediately with suppliers who subcontract work to factories without the retailer's knowledge, changing its policy after a fire killed more than 100 garment workers in Bangladesh, the Wall Street Journal reported.
Wal-Mart is warning suppliers that it is adopting a "zero tolerance policy" for violations of its global sourcing standards and the company's new plan would begin taking effect from March 1, the Journal said.
The tougher code replaces Wal-Mart's prior "three strikes" approach to policing suppliers, which gave the suppliers three chances to address problems before being terminated.
"Obviously our three-strike policy wasn't working as well as it could have," Rajan Kamalanathan, Wal-Mart's vice president of ethical sourcing, told the Journal in an interview. "Our message of zero tolerance is meant to get people's attention."
Wal-Mart could not be reached for comment by Reuters outside of regular U.S. business hours.