CashNews.co
Italy’s antitrust watchdog is investigating the online fast fashion giant Shein for potentially making misleading claims about its sustainability practices.
The country’s independent competition authority said in a statement that the greenwashing probe would focus on Infinite Styles Serves Co. Limited, a Dublin-based company that does business as Shein and operates the online retailer’s website and app.
Shein was founded in China but is now based in Singapore. It has had a meteoric rise in the world of retail, fueled by a business model that allows it to churn out apparel based on real-time demand and deliver it directly to customers from factories primarily located in China.
That has helped the company offer products for ultra-low prices and attract shoppers who can go on its website to buy $11 sweaters, $2 cellphone cases and other products from a quickly updated assortment of items.
But Shein’s critics have long argued the company’s practices encourage overconsumption and environmental waste, problems which the retailer has said it is working to combat.
However, Italian officials are accusing the company of misleading consumers with claims about the environmental sustainability of the clothing it sells. Environmental organizations have alleged such deceptive practices, known as greenwashing, occurs across the corporate world.
Italy’s anti-trust authority, whose abbreviated name in Italian is AGCM, alleges that some of the environmental references on Shein’s Italian website are deceptive or omit information. Images promoting Shein’s clothing as sustainable are also done “through generic, vague, confused and /or misleading environmental assertions,” the authority said in its statement.
In particular, the watchdog cited information from Shien’s “evoluShein” collection, which it said may have misled consumers into thinking the clothes they bought from the collection could be recycled.
AGCM also alleged that the stated commitment to decarbonization featured on Shein’s website were in “apparent contradiction” with the increases in greenhouse gas emissions that Shein included in its sustainability reports for 2022 and 2023.
The online retailer said it would cooperate with the Italian investigation.
“We would also like to take this opportunity to reaffirm our commitment to complying with the laws and regulations in the markets where we operate and to maintaining transparency with our customers,” Shein said in a statement.
Shein has been facing challenges elsewhere in Europe. Critics and advocacy groups such as Amnesty International UK have opposed the company’s possible listing on the London Stock Exchange due to labor and environmental concerns.