Levi’s Leaves Board of Fashion Coalition at Center of China Controversy

Levi Strauss


LEVI -1.77{028e8b43b440f88d50a94b0ac799d5b93a220d942414697744f001bd74eb64d0}

& Co. is leaving the board of a high-profile fashion-industry coalition, according to people familiar with the matter, in a move that presents a leadership gap in a group divided over how to respond to alleged human-rights abuses in China’s cotton-rich Xinjiang region.

After those attacks, BCI and several of its fashion-brand members reversed course on the issue. BCI deleted from its website a statement about its concerns in Xinjiang. Several of its members did the same.

Levi’s was one of the group’s founding members and biggest advocates. One of its executives chaired the board during its early days, after it was created in 2009 as a partnership among big fashion brands, suppliers and nongovernmental organizations to promote sustainability and labor rights. Levi’s was one of three big Western brands on the board, which typically has 12 representatives.

The coalition hasn’t commented on Xinjiang or the Chinese backlash since taking down its statement four months ago. Members of the coalition, a not-for-profit organization based in Geneva and London, remain torn over how and when to respond to the Chinese attacks, according to people familiar with the debate. Some nongovernment organizations and brands want BCI to swiftly and forcefully rebut the Chinese attacks, the people said, while others are pushing for a slower and more cautious approach.

Levi’s was one of three big Western brands on the Better Cotton Initiative board.



Photo:

Jose A. Alvarado Jr. for The Wall Street Journal

Jeffrey Hogue, Levi’s chief sustainability officer as well as its representative on BCI’s board, plans to vacate his BCI board seat imminently, instead of finishing the final months of a four-year term scheduled to end next year, according to people familiar with the matter. A Levi’s spokeswoman said Mr. Hogue is new to the company and is focused on its coming sustainability report. Mr. Hogue joined Levi’s last year, inheriting the board seat from his predecessor.

Levi’s says its status as a BCI member remains unchanged.

BCI updated its website early Friday, removing Levi’s as a board member. A BCI spokesman declined to comment on Levi’s board representation.

BCI has struggled for months to respond in a standoff with Beijing that resulted in some of its other members losing major sales in China. Earlier this year,

H&M Hennes & Mauritz

AB, which also serves on BCI’s board, was largely erased from China’s internet, with its name disappearing from online stores and map apps.

Beijing is beating back international criticism of its treatment of Uyghurs in Xinjiang with a propaganda push on Facebook, Twitter and the big screen. Here’s how China’s campaign against Western brands is aimed at audiences at home and abroad. Photo: Thomas Peter/Reuters

Last year, BCI stopped training and other operations in China’s Xinjiang region, saying it was concerned about allegations of forced labor there. Governments including the U.S. and human-rights groups including Amnesty International say Chinese officials have subjected ethnic Uyghurs and other Muslim minorities to mass internment and forced labor. The Chinese government has called the allegations lies, saying it is combating terrorism and improving livelihoods in Xinjiang.

Months after BCI raised its concerns, Communist Party-affiliated media outlets and social-media accounts attacked BCI and called for a consumer boycott of leading members, saying BCI was spreading lies.

Shortly after those attacks, BCI deleted from its website a statement about forced-labor concerns in Xinjiang.

The other two BCI board members representing brands are H&M and Adidas. Both have suffered from a consumer backlash emanating from BCI’s earlier stance on Xinjiang.

Last month, H&M said sales in China fell about 28{028e8b43b440f88d50a94b0ac799d5b93a220d942414697744f001bd74eb64d0}, representing about $74 million, in the quarter ending May 31 compared with the same period a year earlier. Adidas said Thursday that second-quarter sales in its Greater China market declined 16{028e8b43b440f88d50a94b0ac799d5b93a220d942414697744f001bd74eb64d0} compared with a year earlier. Adidas Chief Executive

Kasper Rorsted

told analysts that the “geopolitical situation” affected sales, but that he expected a strong rebound in China starting this year.

Levi’s doesn’t break out detailed figures for sales from China, saying only that its second-quarter revenue in the country grew 3{028e8b43b440f88d50a94b0ac799d5b93a220d942414697744f001bd74eb64d0} compared with 2019, before the pandemic. Levi’s says it gets about 3{028e8b43b440f88d50a94b0ac799d5b93a220d942414697744f001bd74eb64d0} of its sales from mainland China.

The iconic San Francisco-based jeans maker has challenged Beijing over human rights in the past. In 1993, four years after the Tiananmen Square massacre, the then-family controlled company said it would reduce its relationships with contractors in China because of what it called the country’s “pervasive violation of human rights.” It reversed course in 1998, saying it was confident that it could do business in China and find “responsible business allies” that would comply with Levi’s standards.

Write to Stu Woo at [email protected] and Suzanne Kapner at [email protected]

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