Shein is ramping up internal controls and corporate governance after being hit with millions in fines for regulatory breaches in Europe, including data privacy violations, fake discounts, and greenwashing, according to internal documents and people familiar with the company’s plans.
In a letter to investors, Chairman Donald Tang announced the creation of a Business Integrity Group and an expanded audit team to improve compliance across its global operations. The move follows a €150 million fine in France for cookie tracking without consent, a €40 million antitrust penalty, and a €1 million Italian fine.
Shein, headquartered in Singapore and seeking a Hong Kong IPO, is piloting enhanced compliance systems in North and Latin America, while hiring additional risk and audit specialists in Los Angeles.
The company’s aggressive global expansion has drawn scrutiny from regulators and lawmakers, especially in France, where an OECD investigation found Shein noncompliant with international guidelines on labor rights, transparency, and environmental standards.
Despite these setbacks, Tang said Shein’s second-quarter growth “remained in line with projections,” though rising U.S. tariffs and the end of duty-free imports have forced price increases. Analysts expect European sales to overtake the U.S. for the first time in 2025, reflecting a strategic shift toward the region.
