Dior Lagged Behind on UK's Supply Chain Disclosures

LVMH's second-largest fashion brand, Dior, was until last month behind on disclosures required by UK law regarding working conditions in its supply chain. Reuters found that Dior had outdated statements on its website about a third-party certification that had been terminated more than a year ago. Under the Modern Slavery Act of 2015, UK companies with a turnover of £36 million ($46 million) or above must publish annual statements detailing steps to combat forced labor in their business and supply chains. Until July 19, Dior's UK website displayed an anti-slavery statement from 2020 and a sustainability certification that was no longer valid. Dior, part of the $345-billion LVMH conglomerate, which is a major sponsor of the Paris Olympics, came under scrutiny after Italy's competition authority announced on July 17 that it was investigating whether Dior and Italian label Armani misled consumers about their commitment to craftsmanship and social responsibility. This followed a judicial investigation that revealed potential sweatshop-like conditions at some Italian contractors. The investigation led Europe's top asset manager, Amundi and other investors to urge LVMH to take more aggressive steps to monitor its suppliers' treatment of workers. Dior condemned the illegal practices uncovered at some suppliers, stated it had ceased working with them, and was cooperating with authorities. Armani expressed confidence in a positive outcome following the investigation. Dior published a 2023 modern slavery statement on July 18, following Reuters' inquiries about its compliance with UK regulations. The updated document, approved by Christian Dior UK's board on July 18, is more comprehensive than the 2020 version. Dior plans to implement a training course to raise employee awareness of modern slavery and encourage action if wrongdoing is suspected. Dior has not published statements for 2021 and 2022. The company did not directly address Reuters' questions about the missing statements. Although publishing these statements is mandatory