On September 1, Shein, one of the leading ultra-fast fashion platforms, made its debut on the Hong Kong Stock Exchange with a valuation of approximately $27 billion, after abandoning its attempts to list in London and New York. This figure, compared to the nearly $100 billion it had reached in the private market in 2022, represents a 70% decline.
Why the markets pulled back
“Capital markets do not act out of pure altruism: they react to concrete financial risks,” Ildiko Almasi Simsic, founder of the consulting firm E&S Solutions, explained to Euronews Earth. According to Simsic, the lagging stock prices and discounted valuations demonstrate that investors“recognize ESG issues as direct threats to a company’s ultimate value.”
The model on which this industry segment has grown—thousands of new product codes per day, small batches tested on the market, and supply chains fragmented among dozens of subcontractors—has made it possible to drive down prices. Today, according to Simsic, that fragmentation is “a key risk to the business,” because it makes it impossible to control the supply chain.
Chemicals That Remain in Fabrics
In 2022, a Greenpeace Germany investigation found chemicals exceeding EU limits in 7 of the 47 garments analyzed. In 2025, the organization repeated the test on 56 garments across eight countries: 18—32%—still exceeded the limits, including children’s clothing. Among the substances were phthalates and PFAS—the “forever chemicals”—which have been linked to cancer, fertility issues, and developmental delays in children.
A 2025BBC investigation documented workweeks of up to 75 hours and only one day off per month at some supplier factories. A 2024 report by Public Eye highlights that excessive overtime remains widespread, despite the commitments made following the initial investigations. Cases of child labor in the supply chain—acknowledged by the Hong Kong-listed company—were also recorded in 2023.
“A business model that floods the market with thousands of garments a day for just a few euros can only survive by passing on the real costs to workers and the environment,” Simsic notes. “When a garment is produced for fractions of a cent per stitch, fair wages and materials not derived from fossil fuels become incompatible with that price.”
French Law Changes the Rules
France has enacted a law that taxes ultra-fast-fashion garments based on the volume placed on the market and the cost of repair: ranging from 50 cents for a piece of underwear to 12 euros for a jacket, with a cap that will rise to 19.50 euros by 2030. Beijing has called the measure “discriminatory” and is threatening countermeasures to protect its own companies.
According to Simsic, the sector will survive even if similar regulations are implemented, but without replicating the growth rates of the past: “We are witnessing a shift from voluntary sustainability to strict, legally enforceable standards.” Under the EU Due Diligence Directive, penalties can reach up to 5% of global revenue—a risk that boards of directors can no longer ignore.
