Shein is refusing to disclose relevant information about its supply chain and alleged use of forced labor in China.
The company's silence further impedes its progress toward being listed on the London Stock Exchange.
What's happening?
The fast-fashion giant Shein has been on a long journey of trying to go public and list its shares in London. However, it continues to be met with roadblocks due to questionable supply chain practices, human rights violations, and environmental impacts.
As the Guardian reported, there are allegations that Shein makes garments with cotton produced in a region of China linked to forced labor.
The U.K.'s Financial Conduct Authority emphasized the need for relevant disclosures so people can decide whether to invest in Shein. Instead of being transparent and answering the regulatory organization's questions, Shein's attorneys refused to engage or provide any information.
"Proceedings were farcical from the off," the Guardian report said.
Liam Byrne from the Business and Trade Committee asked Shein's general counsel whether the brand generally sources cotton from China, and the company's response has been described as "wilful ignorance."
Byrne said: "The reluctance to answer basic questions has frankly bordered on contempt of the committee."
Why is Shein's elusiveness significant?
This story is just one of many that have raised eyebrows about Shein's business practices.
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What should the government do about the fast fashion industry?
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Set strict regulations 🚫 Numerous reports have uncovered child labor in Shein's supply chain, as well as low wages and unsafe working conditions for workers.
Beyond ethical labor violations, Shein's model of rapidly producing low-quality, low-cost clothing is resource-intensive and alarmingly wasteful. The production of Shein garments relies heavily on plastic-derived materials that contribute to pollution, landfill waste, and the overheating of our planet.
Even as the company grows, the dangerous chemicals and heavy metals found in Shein clothes can harm human health.
By failing to address these concerns and answer legitimate questions, Shein risks being excluded from the London IPO market.
What's being done about Shein's role in fast fashion?
Fortunately, regulators ask important questions and hold Shein accountable for its controversial business practices. The company must provide truthful answers to go public and gain favor with investors.
In London, experts are also skeptical about a Shein IPO because of its uncertain financial performance and issues with customs-duty fees for low-cost parcels.
As an individual, you can do your part to stop Shein from growing and harming people and the planet by sharing what you know about the brand. Be mindful of corporate greenwashing campaigns aimed at misleading consumers, and lead by example as you shop responsibly and sustainably.
Avoiding fast-fashion brands like Shein and supporting eco-friendly clothing brands is a meaningful commitment and a huge step in the right direction.
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