RE: Boohoo - Independent Review of UK Supply Chain8 Jul 2020 08:33
RNS - 8 July 2020 - continued
Boohoo supports UK manufacturing and the UK fashion industry. Boohoo does not own or operate any manufacturing facilities. We have a global and flexible supply chain and at this time around 40% of the products that we sell are manufactured in the UK, supporting thousands of jobs in this country that may otherwise be lost to overseas markets. Producing garments in the UK does not bring a cost advantage for the Group. We produce garments in the UK because of its proximity to our international distribution centres, giving the Group additional flexibility to react to the latest trends for our customers. The Group is wholly committed to continuing to have garments manufactured in the UK and we will develop initiatives to further support our suppliers.
Since the onset of the COVID-19 pandemic, we have stood side by side with our manufacturers, continuing to pay them promptly with our industry-leading 14-day payment terms for all of their orders. During this period, the Group has not taken advantage of any of the financial support that has been made available by the UK Government in either grant or loan form.
We monitor our UK suppliers through a dedicated in-house compliance team who are responsible for co-ordinating our supplier compliance programme. In 2016, we established an on the ground compliance team in Leicester who carry out regular unscheduled inspections against our Code of Conduct so as to ensure adequate standards are maintained in the supply chain.
In late 2019, we supplemented our team by funding an additional third-party audit programme, with ethical audit specialist, Verisio. We are working together to further improve the transparency of our supply chain compliance, including our tracking and auditing practice. This comprehensive review commenced in May 2020, and is focusing on all of our UK suppliers, and their subcontractors, with unannounced audit visits to all of their facilities. As part of this review, all of our suppliers are required to acknowledge their compliance with the Group's updated Code of Conduct and to provide full disclosure of their own sites as well as details of any locations where work is subcontracted. Non-compliance with this programme will not be tolerated and we are committed to working with the relevant local and national authorities.
Today the Group has launched an independent review of its UK supply chain. The objective of the review is to identify areas of risk and non-compliance, take action to strengthen future compliance, and to provide stakeholders with comfort that similar allegations will not recur in the future.
The review will be led by Alison Levitt QC with Boohoo board representation from Brian Small, the Group's Deputy Chairman and Senior Independent Director.