Shein has revealed that during its increased audits in China, two instances of child labour were uncovered. These cases were identified between January and October 2023. The report does not specify whether the two cases involved two individual children or multiple children across the suppliers. According to Chinese law, child labour refers to individuals under the age of 16.
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Shein’s 2023 sustainability report disclosed that the company identified two cases of child labor in its supplier network during the previous year.
These instances were uncovered through audits aimed at addressing criticisms surrounding Shein’s low-cost business model.
The company suspended orders from the affected suppliers. Orders were only reinstated after these suppliers had implemented corrective measures including robust processes to verify workers’ age and identity documentation.
Shein revised its supplier policies in October 2023. Under the new rules, severe breaches such as child labor and forced labor are grounds for immediate termination of the supplier relationship. Previously suppliers had a 30-day period to rectify such issues before Shein would sever ties.
The company increased the number of audits conducted in 2023 to 3,990, up from 2,812 in 2022 and 664 in 2021. These audits were carried out by third-party agencies including Bureau Veritas, Intertek, Openview, SGS, Tuv Rheinland and QIMA, which handled 92% of the audits last year.
The report showed a decrease in serious violations with child labor detected in only 0.1% of audits in 2023 compared to 1.8% in 2021 and 0.3% in 2022.
The 2023 report highlighted an increase in Shein’s carbon emissions. Emissions from transporting products more than doubled to 6.35 million tonnes of CO2 equivalent in 2023.
This rise is attributed to the company’s reliance on air transport for its global shipping operations.
The company has begun sourcing products from suppliers in Turkey and Brazil to reduce transport emissions. Shein transitioned some shipments from air to sea and land freight, which saved 49,578 tonnes of CO2 equivalent last year.
The company submitted emissions reduction goals to the Science-Based Targets Initiative in June 2024 seeking validation for its climate targets.
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Shein increased its audit efforts in 2023 conducting a total of 3,990 audits, up from previous years. Child labour violations have been reported in the following percentages, 1.8% of audits in 2021, 0.3% in 2022 and 0.1% in 2023.
Apart from child labour the report mentioned a separate issue regarding wage payments at a factory in Guangzhou, China which has since been resolved.
The company has set targets for environmental sustainability including a commitment to achieving net zero emissions by 2050. The company aims for a 25% reduction in emissions by 2030.
Shein had installed or was in the process of installing 90 megawatts (MW) of solar capacity. The company has 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.
Additionally 16.2% of its packaging contains at least 50% GRS certified recycled polyethylene plastic or is made from forest-safe paper.
The company launched industrial waste recycling projects at 14 facilities, achieving an 86% recycling or thermal recovery rate of industrial waste.
The report comes at a critical time as Shein is gearing up for a initial public offering (IPO) likely in the UK. The company had faced pushback regarding its planned IPO in the US due to concerns about its Chinese origins and business practices.
In June 2024 the human rights organization Stop Uyghur Genocide initiated a legal campaign to block Shein’s listing on the London Stock Exchange (LSE), citing concerns about the company’s labor practices and alleged links to human rights abuses.
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