Wal-Mart to toughen standards for suppliers

Wal-Mart plans to announce Wednesday in Beijing that it will require manufacturers supplying goods for its stores to adhere to stricter ethical and environmental standards, the latest effort by the big retailer to answer criticism of its business practices.

At a gathering of more than 1,000 suppliers, Chinese officials and advocacy groups, Wal-Mart executives plan to reveal a new supplier agreement that will require manufacturers to allow outside audits and to adhere to specific social and environmental criteria. The agreement will be phased in beginning in January.

The changes signal a move on the part of Wal-Mart, the world's largest retailer, away from intermittent transactions with many suppliers toward longer-term arrangements with a smaller group of manufacturers. Wal-Mart is betting that using its buying power this way can help keep prices low even as it keeps a closer eye on its suppliers. …