Shein’s London IPO faces political and economic backlash

Chinese e-commerce platform Shein is facing backlash from politicians and major UK fund managers over its planned London IPO.

The kickback is due to concerns over workers’ rights after a Channel 4 investigation in 2022 revealed that some Chinese workers were working 18-hour days and being paid as little as 3p per garment.

London rivals New York for the £35 billion float of the business, which would propel it immediately into the FTSE 100 list.

Shein’s profits more than doubled to $2 billion (£1.6 billion) in April and is now valued at $100 billion (£78.3 billion).

Senior politicians have demanded more scrutiny of the company, such as Conservative chair of the Commons foreign affairs committee Alicia Kearns, who said: “With Shein’s prices so low the London Stock Exchange needs to ask itself, whose suffering is subsiding those prices?

“A company which has failed to make full disclosures about its supply chains as required by UK law, and where there are grave concerns about its factory working conditions has no place in London.”

Sarah Champion, Labour chair of the international development select committee, also commented: “Transparency in supply chains is vital and something all governments should be demanding.

“Serious concerns have been raised about the use of modern slavery by Shein which need investigating.”

Several top fund managers may be turning their backs on the IPO, with M&G, Schroders and Aviva Investors among them.

The UK Sustainable Investment and Finance Association (UKSIF) said it did not want London to “become a listing place of last resort for companies with poor human rights records”.

Shein stepped up plans for its record-breaking float on the London Stock Exchange earlier in May, after regulatory roadblocks between China and the US.