Shein’s decision to pursue a flotation in London is a significant win for the U.K. market, but the ultra-fast fashion giant faces intense scrutiny over its ESG practices. This high-profile listing may set a new standard for other companies considering a presence on British exchanges.
Shein London Float Invites Scrutiny Of ESG Issues : A Landmark Listing for London
Market analysts widely anticipate that Shein will file a prospectus in the coming weeks for a £50 billion ($64 billion) flotation on the London Stock Exchange. This listing would mark a rare triumph for the U.K. capital market, which has seen numerous flotations opt for the more extensive investment pools in the U.S.
The London listing offers an opportunity for British regulators to demonstrate their rigorous environmental, social, and governance (ESG) standards. Shein, however, has faced significant criticism regarding working conditions in its Asian factories, including allegations of forced labor and excessive working hours. These issues are expected to surface prominently during the vetting process.
ESG Concerns Under the Microscope
U.S. lawmakers have already voiced concerns about Shein’s practices. In May 2023, they urged the Securities and Exchange Commission (SEC) to scrutinize the company’s labor practices, with Senator Marco Rubio warning of potential inaccuracies in Shein’s IPO filing due to pressures from Chinese regulators.
