LONDON — Following allegations of sweatshop conditions at its suppliers’ factories in Leicester, England, fast-fashion retailer Boohoo undertook an independent review of its supply chain, and on Friday published the outcome.
The review was conducted by lawyer Alison Levitt, who looked at how “well-founded” the allegations were, and to what extent Boohoo had knowledge of the poor working conditions in its Leicester supplier factories. The allegations were made by garment workers’ campaign group Labour Behind the Label and by The Sunday Times of London.
Levitt concluded there were “many failings in the Leicester supply chain” and proposed a series of improvements the retailer could make in terms of corporate governance, compliance and monitoring process to improve the way it works.
Boohoo said it was already working to improve the faults in its supply chain even before the scandal broke in July. However, it admitted it was not moving fast enough. All the negative press sent the share price plummeting in July.
The company also said it was committing to further, measurable action “in order to effect real change in the Leicester textile industry.”
“The review has identified significant and clearly unacceptable issues in our supply chain, and the steps we had taken to address them. It is clear that we need to go further and faster to improve our governance, oversight and compliance. As a result, the group is implementing necessary enhancements to its supplier audit and compliance procedures, and the board’s oversight of these matters will increase significantly,” said the group’s chief executive officer, John Lyttle.
Some measures it plans to undertake include the appointment of a non-executive director specialized in social and environmental governance, and a new supply chain compliance committee.
The group has also hired a new director for responsible sourcing with knowledge of sustainable supply chains. The company said it will look to consolidate its list of suppliers, and partner with suppliers with a proven track record of sustainability policies. Boohoo said it wants to support those suppliers’ work with a more “predictable flow of orders.”
Addressing the issues in Leicester in particular, the retailer said it will also help local workers establish a garment and textiles community trust, through which they can access funding and ongoing annual support.
“As a board, we recognize that we need to rebuild confidence. These matters will be dealt with appropriately and sensitively, and [we need to ensure] that they will not recur. We recognize that Boohoo has been a major force in driving the textile industry in Leicester and today want to reinforce our commitment to being a leader for positive change in the city, alongside workers, suppliers, local government, NGOs and the community at large,” Boohoo said Friday.