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The 5 Dumbest Things on Wall Street This Week: May 17

2. Wal-Mart's World

Once again Wal-Mart (WMT - Get Report) has proven that it's a world unto itself.

The planet's largest retailer said no to signing a Bangladesh fire and building safety accord this week because it believes it can provide better and faster safety checks by itself. The legally binding agreement was drafted by European labor and non-governmental organizations IndustriALL and UNI Global Union. The plan is meant to prevent tragedies like the building collapse in Bangladesh that killed more than 1,100 garment workers last month.

"While we agree with much of the proposal, the IndustriALL plan also introduces requirements, including governance and dispute resolution mechanisms, on supply chain matters that are appropriately left to retailers, suppliers and government, and are unnecessary to achieve fire and safety goals," said Wal-Mart.

We can see the New York Post headline now: Bentonville to Bangladesh: Drop Dead.

OK. Maybe it's not as malicious as that. Wal-Mart did say it would conduct in-depth safety inspections at all 279 Bangladesh factories with which it works and publicly release the inspection information. It also promised to provide fire safety training for every worker in every factory in Bangladesh that produces its goods. And for the record, the company has stepped up its safety inspections since 110 people were killed in a November 2012 fire in a Bangladesh factory that was making goods for Wal-Mart and other retailers.

Still, without Wal-Mart on board, any attempt at a comprehensive plan is doomed to fail in the same way the League of Nations failed after World War I. The powerful U.S. did not sign up for that body and it quickly turned toothless.

A number of other North American retailers including JC Penney (JCP) and Sears (SHLD) are already following Wal-Mart's lead and drafting their own supplier safety solutions. Trust you us, the creation of all these competitive plans will ensure that none of them will pan out.

And while we understand that the safety of their suppliers' factories is not directly under their purview and more of a governmental problem, the world's retailers could have come together and done something really wonderful to solve this problem this week. Alas, that won't be the case and we can instead count the days till the next tragic incident.

"Transparency is vital to make progress in improving factory conditions, and by disclosing this information, government, workers, non-governmental agencies, and companies can benefit from this work," Rajan Kamalanathan, Wal-Mart's vice president of ethical sourcing, said in a statement.

True, Rajan. Transparency is important, but so is solidarity.

Too bad you'll never know it.
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