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UK watchdog, the Financial Conduct Authority, is facing criticism from UK investor groups after reports from Reuters that it has given Chinese fast fashion retailer Shein the go ahead for a London listing.
A top UK managers’ trade group, including Aviva Investors, Schroders and M&G has criticised the watchdog’s decision, claiming it could affect the UK’s status as a “high quality financial centre”.
The decision also comes despite the concerns expressed by MPs and human rights organisations about a lack of transparency in the retailers supply chains.
James Alexander, CEO of the UK Sustainable Investment and Finance Association, said in a Linkedin post it was “disappointing” to hear reports of the approval and a “race to the bottom on governance and standards” will not help the UK in the long term.
While Shein still faces challenges from volatile global markets and approval from the Chinese government, the move does bring the potential of an initial float one step closer.
The reports come after Shein executive chairman Donald Tang confirmed the fast-fashion giant’s plans to float on the stock market for the first time last month.
It is thought to have originally been targeting an IPO worth £50bn, but it is now understood to have halved its valuation to around £23.8bn following global economic pressures which have only been exacerbated by US President Donald Trump’s 145% tariffs on Chinese goods and tighter rules on duty-free shipments from China to the US.
