Boohoo is failing to provide “adequate Covid governance” at over a dozen factories according to the first published report into its supply chain from Sir Brian Leveson.
The fast fashion retailer saw its share price collapse last year after a bombshell investigation into 62 of Boohoo’s suppliers was published by Alison Levitt QC, finding various health and safety violations, cases of failed payment of wages, failures in recording of hours and identity verification and potential furlough fraud.
In a bid to reassure investors Boohoo launched an overhaul of its supply chain and appointed Leveson, best known as the judge who oversaw the inquiry into the phone-hacking scandal, to oversee the changes.
Amid news that Boohoo’s sales had risen 40 per cent year-on-year to £660.8 million throughout December yesterday, Leveson also published his first report into the company’s supply chain.
According to the report Bureau Veritas, one of its new supply chain auditors, had reviewed 13 manufacturers stating that “not one of them has adequate Covid governance in place”.
The report focused “mainly on suppliers and subcontractors outside of Leicester”, Boohoo’s UK manufacturing hub where a significant portion of its garments are made, and compliance scores ranged from 16 to 98 per cent.
Boohoo’s chief executive John Lyttle, who has faced calls for resignation since the scandal broke, told the Financial Times that any non-compliance with social distancing and coronavirus hygiene rules detailed in the report had now been addressed.
As part of the overhaul, Boohoo has already removed 64 suppliers from its roster, but Leveson added their efforts remained “a work in progress if the group is to create and establish a critical hearts and minds programme involving everyone in the buying chain”.
Boohoo’s share price, which has managed to largely recover since the scandal broke, were down three per cent yesterday.