updated 10/31/2006 11:00:33 AM ET 2006-10-31T16:00:33

Wal-Mart Stores Inc., the world’s largest retailer, took another step Monday in its attempt to be more environmentally friendly when it singled out three commercial chemicals it wants phased out among its suppliers.

Companies will have the option to not take part in the program, but Wal-Mart says it will reward firms that find alternatives to the compounds it wants out of circulation.

Wal-Mart named two chemicals used in insecticides, propoxur and permethrin, and a cleaning agent, nonyl phenol ethoxylate. Wal-Mart has developed a list of preferred chemical characteristics that it wants its suppliers to use.

“One of our environmental goals at Wal-Mart is to sell products that sustain our resources and our environment,” Wal-Mart senior vice president and general merchandise manager John Westling said in a news release. “The three priority chemicals we are focusing on are a first step in implementation.”

Westling said 17 chemicals will be added to the list in the coming two years.

“We anticipate that our efforts will encourage our suppliers and their suppliers to innovate new product formulations that will be better for our customers and for the environment,” he said.

Wal-Mart says it will use a three-phase process to involve its suppliers. The first will give a vendor time to notify Wal-Mart about its uses of the chemicals in question. The second will be for the supplier to inform Wal-Mart about its plans for the chemicals and the third would be for “recognition and reward” for participating suppliers, according to the company.

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