Wal-Mart says too few investment firms support minority businesses

The firm is setting up a private equity fund to invest in such companies, which serve the retail distribution sector.

Funding will be available to help firms in making acquisitions, launching new ventures and other expansion efforts.

Wal-Mart faces a class action lawsuit from 1.6 million current and former female staff alleging discrimination.

This fund complements and extends our company's long-standing supplier diversity programs Esther Silver-Parker, Wal-Mart

The lawsuit - the biggest civil rights case against a private employer in US history - alleges the retailer discriminates against its female staff regarding pay and promotions.

The company denies discrimination and is appealing a ruling last year giving the suit class action status.

In class action cases, anyone who finds themselves in the same situation as those suing are covered by the outcome even if they are not one of the plaintiffs.

Filling a void

Wal-Mart will invest in up to nine businesses through the fund - to be managed by Texas company Aldus Equity - over a five-year period.

With only 2% of all US venture capital funds currently investing in minority businesses, Wal-Mart said the initiative would fill a "significant void".

"This fund complements and extends our company's long-standing supplier diversity programs," said Esther Silver-Parker, the firm's vice president of diversity relations.

Wal-Mart has been seeking to answer its critics which have accused it of a poor record on diversity, pay, employment benefits and labour rights.

Earlier this year, the firm took out a series of adverts in national newspapers in which it said that the company's activities were "good for consumers, good for communities and good for the US economy".