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LONDON – Chinese fast fashion brand Shein dropped 9,008 new product lines today. On Tuesday it dropped 9,677. On Monday this figure was 7,282. I recently asked Shein’s global head of ESG Adam Whinston how many new lines Shein launched each day, and he failed to answer. Of course he did.

Fortunately, Shein’s website has a section called Daily New where you can find the answer to this question yourself.

If we take the lowest of the above figures, round it downwards to 7,000, and then multiply it by 365 days, we get a figure of 2,555000. Is dropping more than two and a half million new product lines each year sustainable?

Shein seems to think it is. The business has in recent months hired its first head of sustainability, published its first sustainability report and launched its inaugural sustainable clothing collection. Of the latter, Whinston said: “Launching evoluSHEIN is one important step in our sustainability commitments this year, which touches on each of our key focus areas – protecting the environment, supporting communities, and empowering entrepreneurs.”

Controversies around Shein have been covered extensively in the past few years, and readers can view examples here, here and here

There’s no point going over old ground discussing the merits of Shein. Any business that drops thousands of new fashion lines a day is not sustainable. Period.

But that’s not what we’re here to debate.

Instead, I want to ask how and why investors seem to take Shein seriously (even supposedly ESG investors) and why some media outlets and other industry stakeholders seem to be falling for the greenwash (yes, seriously).

It’s only in the past 18 months or so that Shein has started to push its sustainability agenda. Before that, the business seemed content to take the flack and remain something of an outlier in the fast fashion space. Most other fast fashion players – H&M, Boohoo, Zara and so on – have gone to extraordinary lengths to tell us their business models are sustainable, including joining all manner of initiatives, launching endless rounds of ‘green’ lines, spending tens of millions on marketing and so on.

Shein previously did none of the above. Perhaps it felt it didn’t need to given its extraordinary growth trajectory and huge popularity with young consumers (we keep being told young consumers are environmentally-minded. Erm, about that …)

In recent times things have changed. Shein has been looking at going public via an IPO on the US stock market. There has been talk of a US$100bn valuation which would enable the company to raise US$1bn to hasten its ambitious expansion plans.

The IPO has been put off so far for various reason, including market volatility caused by the war in Ukraine and the tail end of the pandemic which is stifling Chinese supply chains. But it surely will happen. When it does, Shein’s executives know that a public listing will bring greater regulatory oversight (all listed companies are subject to onerous financial reporting rules) and heightened public scrutiny.

Hence the charm offensive by Shein in recent months, and efforts to re-brand itself as sustainable.

Should we be taken in? I can think of two NGOs which already have been, and fully expect more to follow. Textile Exchange recently welcomed Shein as a new member, seemingly quite happy to accept a business which launches 9,000 new lines a day provided that said member is selling recycled polyester clothing which is certified to its Global Recycled Standard (GRS).

Textile Exchange states on its website that it has a vison of, “an enriching global textile industry that protects people and planet by positively impacting climate, soil health, water, and biodiversity.”

How can this vision possibly be squared with facilitating the greenwash of a business model as harmful as Shein’s? Truly, we are in the land of Orwell’s 1984 here, a world of doublethink where 2+2=5.

What must Textile Exchange’s other members think? Surely the whole idea of becoming a member of body such as this is to gain some kind of exclusivity and credibility (which is precisely why Shein joined).

Textile Exchange is not the only NGO to welcome Shein to the “sustainability” party. CanopyStyle, the non-profit, recently announced Shein as a member. Canopy’s work is focused on protecting endangered forests and relates to viscose use by fashion. It was a surprise to find that Shein actually uses viscose in any of its clothing but a check on its website suggests it does. In fact, on the day I checked, Shein’s website listed 35,212 products containing viscose fibres. Forget where this viscose was sourced, perhaps a better question is, are these kinds of viscose volumes even sustainable? Did Canopy even ask?

There is another element to all this. We hear so much talk of ESG investing at the moment. Fast-growth models like Shein depend heavily on access to easy finance to fund their insatiable expansion. It’s supposedly becoming harder to gain access to this finance as investors are increasingly factoring in ESG issues.

That’s the theory anyway.

But ask yourself this: how does an investor decide whether a fashion brand is sustainable? What ESG criteria are they using?

The clues are already out there. Mango recently announced a £200m re-financing package which is linked to ESG targets. Apparently, the cost of Mango’s loan will reduce if it achieves 100 per cent use of “sustainable cotton” (such as Better Cotton or organic), use of certified recycled polyester and reducing scope 1 and 2 emissions (irrelevant as most emissions take place in scope 3).

In 2020, Burberry announced an ESG linked loan linked to – among other things – its use of BCI cotton. The same year, VF Corp penned a US$500m ESG linked financing package linked to use of certified recycled polyester and ‘sustainable’ cotton.

Adidas has signed off on a similar sized financing package linked to the “purchase of fabrics that contain at least 50 per cent recycled polyester and sourcing cotton certified to the Better Cotton Initiative.”

This, then, is how you meet ESG criteria in the fashion industry. You join the Better Cotton Initiative, you say you are using GRS-certified recycled polyester or you join one of the numerous other initiatives in our industry masquerading as sustainable. Provided you do this, the nature of your business model, the fact you are launching thousands of new lines per day, simply does not matter.

I’m aware that other industries have hardly covered themselves in glory when it comes to ESG investment criteria. But has any industry set the bar as low as fashion?

I’ve written in the past that some NGOs in our industry are hindering progress by facilitating greenwashing. Not everybody is on board with this view and it’s clearly a line of thought which ruffles feathers. But what else is one supposed to think? Shein is gaining mainstream credibility and kudos via its membership of NGOs such as Textile Exchange and CanopyStyle. In the same way, fashion retailers are being allowed to pull the wool over the eyes of ESG investors by mere virtue of the fact that they are members of Better Cotton (which has yet to offer a shred of independent evidence its cotton is better for the planet).

If these and other NGOs (the Sustainable Apparel Coalition lists Boohoo as a paying member) are as serious about sustainability as they say, they have a duty of care to hold members to a far higher standard. They have a responsibility to demand better, both for the sake of existing members who are doing the right thing, and the broader credibility of the fashion industry as a whole.

As it stands, their ‘pay-to-play’ model is creating confusion and a distorted sense of sustainability for ESG investors and end consumers alike.

It’s also sending out a clear message to the market which is this: it’s okay to have a fundamentally harmful business model provided you tick all the right ESG boxes. And we can help you do that!

This is greenwashing in its purest form. A fashion retailer dropping 9,000 lines a day is not sustainable. On the contrary, it’s grotesque. Those NGOs which are enabling such a retailer to convince the world otherwise need to take a long hard look in the mirror, and ask themselves precisely why it is they entered this industry in the first place.


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