Shein pledges 15 million dollars to upgrade supply chain factories

Fast fashion e-tailer Shein has said it plans to spend 15 million dollars on upgrading the hundreds of factories in its supply chain over the next three to four years.

In a release, the controversial retailer said the investment would focus on physical enhancements to suppliers’ factories as part of its Supplier Community Empower Programme (SCEP).

It added that more than 30 projects are set to be completed by the end of the year, while 100 are expected to be completed by the end of 2023 and up to 300 within four years.

Shein further noted that all of its manufacturing suppliers have agreed to comply with its Responsible Sourcing (SRS) programme, which it said ensures employees are treated fairly in safe working conditions, and its Code of Conduct.

It added that more than 2,600 independent audits had been conducted in the past 12 months.

However, it did state that it was “determined to do more” and was committed to doubling the four million dollars a year it puts into its SRS scheme.

Speaking on the news, Adam Whinston, global head of ESG for Shein said: “We take our responsibility to safeguard the welfare of workers at all our suppliers very seriously.

“Through Shein’s SRS programme we have been working diligently with our contracted partners to improve welfare and working conditions. We are now looking to double our investment in the SRS programme to improve supplier management further.”

The announcement follows a number of external investigations into Shein’s supply chain, including the most recent by British broadcasting platform Channel 4, which aired a documentary on the Chinese business and factories within its supply chain.

Evidence unveiled as part of the investigation found workers in two of its garment factories being paid as little as three pence, while working 18-hour shifts.

Independent investigation opposes previous reports

Responding to Channel 4’s allegations, Shein said it carried out an independent investigation which refuted “most” of the claims made in the documentary.

Despite this, the retailer said it had still reduced orders from the two producers by three-quarters until they complied with its Code of Conduct.

According to its findings, Shein said workers at both factories had received wages in accordance with local labour laws and regulations, with workers in both said to receive salaries between 1,162 and 1,212 pounds.

It added that claims workers’ salaries were being withheld or illegally deducted were also untrue.

Furthermore, the investigation showed that the maximum working day at both factories was between 12.5 and 13.5 hours, with workers taking at least two to three days off per month.

Shein noted that while the hours were less than the allegations, they were still higher than local regulations, with it therefore giving suppliers until the end of December to rectify the situation.

In terms of pence per completed garment, Shein said the figure initially cited referred to a per-step-per-piece commission and not for a fully completed item.

Shein’s Whinston added that the company has now implemented a multi-channel feedback system for its workers at contracted factories, allowing them to anonymously submit complaints and feedback through multiple channels.