Fast fashion retailer Shein has reported two cases of child labour in its supply chain, the company’s 2023 sustainability and social impact report has revealed.
The findings emerged as the company increased audits of manufacturers in China to address concerns about its low-cost business model, particularly as it prepares for a planned flotation.
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The company has suspended orders from the suppliers in question until they improve their processes, including the verification of workers’ identity documents.
Shein emphasised that both cases were “resolved swiftly”, with actions such as terminating the underage employees’ contracts, arranging medical checkups and ensuring their safe return to their families.
In response to the incidents, Shein revised its supplier policy in October 2023.
The new “Immediate Termination Violations” clause mandates the immediate cessation of business with any supplier found in severe breach of the rules, a significant tightening from the previous 30-day resolution period.
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By GlobalDataThe updated supply chain policy reflects input from both regulators and suppliers, Reuters reported, citing Annabella Ng, a senior director of global government relations at Shein in Singapore.
Shein had not previously disclosed specific child labour statistics. It reported that such violations were found in 1.8% of audits in 2021, in 0.3% in 2022 and in 0.1% in 2023.
The retailer, known for its budget-friendly fashion, conducted 3,990 audits in 2023, a substantial increase from earlier years.
The 2023 sustainability and social impact report also revealed that Shein has committed to achieving net zero emissions by 2050 and is crafting a decarbonisation strategy following the Science Based Targets initiative (SBTi) net-zero standard, aiming for a 25% reduction in emissions by 2030.
The company has made progress in sustainable practices, with 90MW of solar capacity installed or in progress by the end of 2023.
It has also introduced sustainable delivery options and reported that 10.9% of the fibre used in its branded products is now recycled polyester or forest-safe viscose, with 16.2% of its packaging containing at least 50% GRS [Global Recycled Standard]-certified recycled polyethylene plastic or made of forest-safe paper.
Shein also launched industrial waste recycling projects at 14 facilities in 2023, achieving 86% recycling or thermal recovery of industrial waste.
In June 2024, the human rights organisation Stop Uyghur Genocide initiated a legal campaign to prevent Shein from listing on the London Stock Exchange (LSE) in the UK.
