Shein’s London IPO Hits Roadblock Over Workers’ Rights Concerns

Shein’s planned initial public offering (IPO) in London is facing resistance from politicians and major UK fund managers due to concerns about workers' rights at the retailer. The online fast fashion giant is considering a £53 billion float.

Senior UK politicians, including three parliamentary committee chairs, are advocating for heightened scrutiny of Shein's business practices. They have called for a thorough examination of the listing, suggesting it should not proceed while parliament is dissolved for the general election, The Guardian reported.

“With Shein’s prices so low, the London Stock Exchange needs to ask itself, whose suffering is subsiding those prices?” said Alicia Kearns, Conservative chair, Commons foreign affairs committee. Kearns emphasized that a company failing to make full disclosures about its supply chains, as required by UK law, and with serious concerns about factory working conditions, should not be allowed to list in London.

Sarah Champion, Labour chair of the international development select committee, underscored the importance of transparency in supply chains. She highlighted the need for all governments to demand such transparency and called for an investigation into allegations of modern slavery associated with Shein.

Prominent UK fund managers, including Aviva Investors, M&G, and Schroders, are reportedly hesitant to support the IPO. The UK Sustainable Investment and Finance Association (UKSIF) voiced its concern, stating it did not want London to become a “listing place of last resort for companies with poor human rights records.” In 2022, a Channel 4 undercover investigation revealed troubling conditions in factories supplying Shein. Workers were found to be working up to 18 hours a day, including weekends, with just one day off per month, and earning only  £3 per garment.

Earlier this month, Shein accelerated plans for its IPO on the London Stock Exchange, opting for London after facing regulatory challenges between China and the United States, and opposition from American regulators.