Fast-fashion company Shein is trying to go public and be listed on the stock exchange.
However, its ties to questionable business practices and ethical and environmental concerns have created roadblocks and political hurdles.
What's happening?
As The Business of Fashion reported, Shein failed to go public in New York and is now trying to do so in London.
Advocacy groups are presenting Shein with legal challenges due to allegations of forced labor and human rights abuses. Groups have sent letters to the UK's financial regulator opposing Shein's going public.
Meanwhile, corporate accountability campaigns raised concerns about Shein's greenwashing, non-compliance with labor standards, and lack of transparency. Shein is also up against an anti-slavery commissioner regarding alleged human rights violations and needs China's securities regulator's approval to go public.
"There's a lot of hurdles, and the fact that it's taken this long suggests that it's not going to happen any time soon and may never happen at all, at least not in the UK," said David Swartz, a Morningstar senior equity analyst. "This is a high-profile company, but unfortunately it's also a lightning rod for controversy."
Why is Shein going public important?
If Shein overcomes these hurdles and goes public, it could be the biggest listing in London in a long time.
This means Shein could offer many shares to the public and raise an exorbitant amount of capital while attracting more investors. Large IPOs generate a lot of investor attention and public hype with enhanced company visibility and strong growth potential.
For the health and safety of workers and the sustainability of our planet, fast fashion needs to fade away rather than grow larger than ever before.
🗣️ What should the government do about the fast fashion industry?
🔘 Set strict regulations 🚫
🔘 Incentivize sustainable options 💰
🔘 Use both regulations and incentives 🏛️
🔘 Nothing 🙅
🗳️ Click your choice to see results and speak your mind
Cheap, low-quality, mass-produced clothing is only fast and low-cost because of its devastating social and environmental damage. It's incredibly wasteful during production and quickly ends up in landfills because it can't be repaired or worn more than a few times.
What's being done about fast fashion growth?
Fortunately, many politicians and advocacy organizations oppose Shein going public, and investors are even concerned about the financial risks.
Policymakers are cracking down on shipping laws for low-value packages like Shein's, and governments are looking to impose compliance burdens on fast-fashion companies that violate environmental regulations.
President-elect Donald Trump has also indicated he will impose costly tariffs on imported goods from China, where Shein makes most of its garments.
As a consumer, you can help fight fast fashion's growth by not buying from companies like Shein and encouraging your friends and family to avoid them.
Far better alternatives for your long-term wardrobe budget, worker health, and the environment are thrift store shopping for high-quality secondhand items that already exist and upcycling old clothes to save money and reduce waste.
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