"Exclusive: Investors push Zara owner Inditex to publish full supply chain"

Investors want Zara owner Inditex to follow rivals H&M and Primark in making its full list of suppliers public so they can better assess any supply chain risks...

Fashion brands and retailers, including Adidas (ADSGn.DE), opens new tab, H&M, Hugo Boss (BOSSn.DE), opens new tab, M&S (MKS.L), opens new tab, Nike (NKE.N), opens new tab, Primark, and Puma (PUMG.DE), opens new tab, already publish detailed supplier lists, including factory names and addresses.

Inditex publishes annually the number of suppliers it sources from in 12 core countries, but gives no information on individual factories.

Reuters asked Inditex shareholders what they wanted to see from the company in terms of improved disclosure.

In response, Dutch asset manager MN said: "In our engagement with Inditex one of the things we ask is if they could disclose a list of their suppliers and the geographical location." ...

MN, which manages Dutch pension fund assets, said it was important to have this insight to show whether Inditex has this information available, as well as for its own due diligence...

Inditex, set to publish annual results on March 13, declined to comment on investors' demands for it to publish its full supplier list.

"Inditex has a deep commitment to maintaining high standards in its supply chain, and believe that our industry-leading traceability system, which gives us maximum visibility of the supply chain, is key to this," an Inditex spokesperson said...

None of the investors Reuters spoke to are considering divesting from Inditex.

MN said it advised its clients in December to divest from off-price retail chain TJX, which owns Homesense and TK Maxx, and they were divested as of January 1.

"Over the more than three years of engagement we have seen very little improvement on human rights due diligence in their global supply chain," MN told Reuters.

TJX said it has strengthened its vendor code of conduct and expanded its factory auditing programme in recent years...

KnowTheChain, a benchmarking initiative for companies and investors to address forced labour in supply chains, gave Inditex a lower overall score in its 2023 assessment than its 2021 assessment.

"The company is encouraged to strengthen its supply chain transparency by disclosing a full, rather than partial, list of its direct suppliers," KnowTheChain said...