SHEIN Seeks U.S. IPO Despite Reports of Labor Violations

SHEIN Seeks U.S. IPO Despite Reports of Labor Violations

Amidst many discussions about sustainability in the political and social media sphere, fast fashion companies are killing it in the global retail market. But maintaining an online inventory of over 600k items at any given moment means that labor conditions can be overlooked to meet demand. SHEIN is now the leader of this market and is seeking to be publicly traded by 2024. 

The Chinese fast-fashion company has gained viral success

SHEIN has officially outperformed seasoned fast-fashion retailers like Zara and H&M. The company netted $16 billion in sales last year and with the rising cost of consumer supplies, the desire for affordable fashion is only growing. The TikTok community is a big fan of fast fashion because influencers are able to create new looks at a rapid pace without breaking the bank. It’s no secret that a ravenous production schedule and a high demand for cheap clothing comes at a cost.

Activists are curious about SHEIN’s working conditions

In November 2021, outlet Business of Fashion reported that a non-governmental organization hired Chinese researchers to investigate SHEIN’s manufacturing operations and uncovered some concerning violations by SHEIN partners. To cut costs, the company outsources their manufacturing to small workshops, often in the form of informal contracts that are hard to track down and trace. Some of these workshops were discovered to be densely packed residential buildings that are quickly fashioned into a workplace, often bypassing basic safety protocols like windows for airflow or fire exits. It was also found that workers sometimes endured 75-hour work weeks and were sometimes forced to work 12-14 hour shifts in one day.

The company hopes to improve their image

SHEIN’s Supplier Code of Conduct states that they are compliant in their legal requirements, that their workforce is voluntarily employed, and their partners provide a safe and healthy workplace for employees. In December of last year, the global retailer launched the SHEIN Cares Fund, a $10 million pledge to support non-profits that empower entrepreneurs, promote sustainability, and improve communities.

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