Boohoo scrutinised for returning to a supplier it struck off after a modern slavery scandal

GN Euro, a Leicester-based clothing manufacturer, has resumed selling womenswear to Boohoo through a new Moroccan facility despite it being axed by the retailer shortly after a mass supplier cull in 2021. 

According to a report by The Telegraph, the retailer maintains that all goods sourced from GN Euro now come from its Tangier factory, operating under the name Euro Touch.

While there’s no evidence of non-compliance with Boohoo’s updated ethical standards, the move raises questions about the company’s move to re-engage with old suppliers, says the report. 

A Boohoo spokesman said it “strongly refuted” any suggestion that the company’s standards have dropped.

The modern slavery scandal was first revealed in 2020, when an undercover reporter for The Sunday Times discovered a factory with workers being paid less than minimum wage. The claims were verified in an independent review by barrister Alison Levitt KC.

The names of around 400 suppliers that were struck off during the scandal were never revealed, as Boohoo co-founder and chair Mahmud Kamani claimed it would “prejudice any future applications” to join its supplier list.

A Boohoo spokesperson said: “Boohoo is open and transparent about its entire supply base, with all our suppliers listed and regularly updated on the company’s website. We do not work with suppliers that cannot adhere to our highest standards.

“We only onboard a supplier or factory that goes through our strict onboarding process and due diligence checks, no exceptions. Every supplier signs our code of conduct, has a valid third-party social compliance audit and is visited regularly by our ethical teams on the ground for an audit.”

The development coincides with internal turmoil at Boohoo.

Kamani is embroiled in a power struggle with Mike Ashley, the Frasers billionaire who has become Boohoo’s largest shareholder.

Ashley has initiated a boardroom coup, citing a “leadership crisis” and questioning the board’s ability to manage the business and its brands effectively.

Last week, Boohoo called on its other shareholders to vote against all the proposals set out by Frasers, insisting its board can turn the ship around even as its losses deepened in the first half.

Ahead of a general meeting of Boohoo shareholders on December 20, to vote on the proposals, Boohoo has told shareholders it has a “credible plan to unlock and maximise value for the benefit of all shareholders through its business review, and that new CEO Dan Finley is the right chief executive to lead the business”.

The circular goes on to say that Frasers and Ashley “appear intent on disrupting Boohoo’s business review and acting only in its own commercial self-interest”, adding that “Frasers has prior history of this sort of corporate behaviour”.