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Time of India
a day ago
- Business
- Time of India
Cashmere king Loro Piana becomes latest Italian luxury brand called out for worker abuse in supply chain
By Emilio Parodi Cashmere king Loro Piana , part of LVMH 's luxury empire, became on Monday the fifth high-end brand to be put under judicial administration in Italy over worker abuses in supply chains, after an investigation that has tainted the image of Italian luxury goods. Loro Piana Spa will undergo court monitoring for a year, according to the 26-page ruling reviewed by Reuters, which stems from investigations into the world of subcontracting for luxury goods in Italy that started in 2023. Units of fashion brands Valentino , LVMH's second largest brand Dior, Italy's Armani, and Italian handbag company Alviero Martini were also placed under administration. The Court of Milan found that Loro Piana, which makes expensive cashmere clothing, subcontracted its production through two front firms that had no actual manufacturing capacity to Chinese-owned workshops in Italy, which the court said exploited workers. LVMH, the world's biggest luxury group, acquired 80% of Loro Piana in July 2013, with the Italian family that founded the company retaining 20%, according to the court ruling. In June, Loro Piana appointed Frederic Arnault, a son of LVMH chairman and Chief Executive Bernard Arnault, as its CEO. The Milan court, as in the cases of the other brands targeted by the investigation, found Loro Piana "culpably failed" to adequately oversee its suppliers in order to pursue higher profits, according to the ruling. Loro Piana declined to comment. LVMH was not immediately available for comment. The owners of the contracting and subcontracting companies were under investigation by Milan prosecutors for exploiting workers and employing people off the books. Loro Piana Spa itself faces no criminal probe. The prosecutors in the case said the violation of rules among fashion companies in Italy was "a generalised and consolidated manufacturing method". "Direct experience [from all the various investigations, i.e. Armani, Dior, Valentino, Alviero Martini and Loro Piana on the control of production chains] indicates that the complete outsourcing of industrial production processes is aimed exclusively at reducing labour costs and, consequently, also the criminal and administrative liability of the company with regard to worker safety... All this is done with a view to maximising profits at the lowest possible production cost," the Court of Milan said in its ruling on Monday. WORKER ABUSES AT SUBCONTRACTORS Italy is home to thousands of small manufacturers that make up 50%-55% of global luxury goods production, consultancy Bain has calculated. In May, Italy's fashion brands signed an accord with legal and political authorities to fight worker exploitation, but the ruling on Loro Piana said "this production chain, headed by Loro Piana, has continued to operate until now" and despite the previous cases being widely reported. The case involving Loro Piana Spa originated after Carabinieri police from the Milan labour protection unit in May arrested a Chinese workshop owner and closed his factory in the northwestern suburbs of Milan. The employer was reported by one of his workers for beating him, causing injuries that required 45 days of treatment, after the worker demanded 10,000 euros ($11,692.00) in unpaid wages. Carabinieri police found that the workshop produced Loro Piana-branded cashmere jackets and that its 10 Chinese labourers, including five illegal immigrants, were forced to work up to 90 hours a week, seven days a week, were paid 4 euros an hour, and slept in rooms illegally set up inside the factory. Carabinieri said in a statement they inspected two intermediary companies and three Chinese workshops, all in the Milan area, and identified 21 workers, 10 of whom were working off the books without proper registration, including seven illegal immigrants. According to the court ruling, the owner of an intermediary company stated that in recent years she had been producing around 6,000-7,000 jackets per year for Loro Piana at an agreed price of 118 euros per jacket if the order was for more than 100 items and 128 euros if the order was under 100 items. Based on the Loro Piana website, for example, men's cashmere jackets range from a minimum of over 3,000 euros to a maximum of over 5,000 euros. In their statement, Carabinieri concluded they had closed two Chinese-owned factories, the third being a 'paper' company with no production capacity, and imposed a joint fine of over 240,000 euros. The Milan court in its ruling on Loro Piana also appointed an external administrator to verify the company meets all the judges' demands on control of its supply chain. The administration will be lifted earlier if the unit brings its practices into line with legal requirements, as was the case with Dior, Armani and Alviero Martini.
Express Tribune
2 days ago
- Business
- Express Tribune
Milan court flags LVMH brand for labour abuse
An Italian court has placed LVMH group's high-end Italian cashmere firm Loro Piana under judicial administration for a year after allegedly uncovering worker abuse inside its supply chain, in the latest in a string of cases that have tainted the image of Italy's luxury brands. Loro Piana Spa is the fifth fashion company to be targeted by the same Milan court for similar labour issues since 2023, according to the 26-page ruling reviewed by Reuters on Monday. Units of fashion brands Valentino, LVMH's Dior, Italy's Armani, and Italian handbag company Alviero Martini were also placed under administration. The court found that Loro Piana, which makes cashmere clothing, subcontracted its production through two front firms with no actual manufacturing capacity to Chinese-owned workshops in Italy that it said exploited workers. The Milan court found Loro Piana "culpably failed" to adequately oversee its suppliers in order to pursue higher profits, according to the ruling. The court in its ruling also appointed an external administrator to verify the company meets all the judges' demands on control of its supply chain. Loro Piana declined to comment. LVMH was not immediately available for comment. The administration will be lifted earlier if the unit brings its practices into line with legal requirements, as was the case with Dior, Armani and Alviero Martini previously targeted by the court. LVMH, the world's biggest luxury group, acquired 80 per cent of Loro Piana in July 2013, leaving 20 per cent in the hands of the Italian family that founded the company. In their ruling, the Milan judges wrote that despite the previous cases being widely reported "this production chain, headed by Loro Piana, has continued to operate until now". In its ruling, the court also emphasises that this kept going even after representatives of Italy's fashion brands signed an accord in May with legal and political authorities to fight worker exploitation. The owners of the contracting and subcontracting companies are under investigation by Milan prosecutors for exploiting workers and employing people off the books. Loro Piana Spa itself faces no criminal probe. The prosecutors in the case said the violation of rules among fashion companies in Italy was "a generalised and consolidated manufacturing method". Italy is home to thousands of small manufacturers that make up 50-55 per cent of global luxury goods production, consultancy Bain has calculated. Reuters
Business Recorder
2 days ago
- Business
- Business Recorder
LVMH's Loro Piana put under court administration in Italy over labour exploitation
MILAN: An Italian court has placed LVMH group's high-end Italian cashmere firm Loro Piana under judicial administration for a year after allegedly uncovering worker abuse inside its supply chain, in the latest in a string of cases that have tainted the image of Italy's luxury brands. Loro Piana Spa is the fifth fashion company to be targeted by the same Milan court for similar labour issues since 2023, according to the 26-page ruling reviewed by Reuters on Monday. Units of fashion brands Valentino, LVMH's Dior, Italy's Armani, and Italian handbag company Alviero Martini were also placed under administration. The court found that Loro Piana, which makes cashmere clothing, subcontracted its production through two front firms with no actual manufacturing capacity to Chinese-owned workshops in Italy that it said exploited workers. The Milan court found Loro Piana 'culpably failed' to adequately oversee its suppliers in order to pursue higher profits, according to the ruling. The court in its ruling also appointed an external administrator to verify the company meets all the judges' demands on control of its supply chain. Loro Piana declined to comment. LVMH was not immediately available for comment. The administration will be lifted earlier if the unit brings its practices into line with legal requirements, as was the case with Dior, Armani and Alviero Martini previously targeted by the court. LVMH, the world's biggest luxury group, acquired 80% of Loro Piana in July 2013, leaving 20% in the hands of the Italian family that founded the company. Italian fashion firms violate rules In their ruling, the Milan judges wrote that despite the previous cases being widely reported 'this production chain, headed by Loro Piana, has continued to operate until now'. In its ruling, the court also emphasises that this kept going even after representatives of Italy's fashion brands signed an accord in May with legal and political authorities to fight worker exploitation. The owners of the contracting and subcontracting companies are under investigation by Milan prosecutors for exploiting workers and employing people off the books. Loro Piana Spa itself faces no criminal probe. The prosecutors in the case said the violation of rules among fashion companies in Italy was 'a generalised and consolidated manufacturing method'. Italy is home to thousands of small manufacturers that make up 50%-55% of global luxury goods production, consultancy Bain has calculated. Worker beaten after asking for backpay The case involving Loro Piana Spa originated after Carabinieri police from the Milan labour protection unit in May arrested a Chinese workshop owner and closed his factory in the northwestern suburbs of Milan. The employer was reported by one of his workers for beating him, causing injuries that required 45 days of treatment, after the worker demanded 10,000 euros ($11,692.00) in unpaid wages. Carabinieri police found that the workshop produced Loro Piana-branded cashmere jackets and that its 10 Chinese labourers, including five illegal immigrants, were forced to work up to 90 hours a week, seven days a week, were paid 4 euros an hour, and slept in rooms illegally set up inside the factory. Carabinieri said in a statement they inspected two intermediary companies and three Chinese workshops, all in the Milan area, and identified 21 workers, 10 of whom were working off the books without proper registration, including seven illegal immigrants. According to the court ruling, the owner of an intermediary company stated that in recent years she had been producing around 6,000-7,000 jackets per year for Loro Piana at an agreed price of 118 euros per jacket if the order was for more than 100 items and 128 euros if the order was under 100 items. Based on the Loro Piana website, for example, men's cashmere jackets range from a minimum of over 3,000 euros to a maximum of over 5,000 euros. In their statement, Carabinieri concluded they had closed two Chinese-owned factories, the third being a 'paper' company with no production capacity, and imposed a joint fine of over 240,000 euros.
Straits Times
2 days ago
- Business
- Straits Times
LVMH's Loro Piana put under court administration in Italy over labour exploitation
Find out what's new on ST website and app. This is the second time one of the luxury group's businesses has been taken to court over labour issues. MILAN - An Italian court on July 14 placed under judicial administration LVMH's high-end Italian cashmere firm Loro Piana for indirectly subcontracting its production to Chinese-owned firms accused of exploiting workers, the latest brand to be embroiled in investigations into labour malpractice inside the Italian luxury supply chain. The court in Milan ordered a one-year administration for Loro Piana Spa, according to a 26-page ruling reviewed by Reuters, in the latest in a string of cases that have tainted the image of Italy's luxury brands. The administration will be lifted earlier if the company brings its practices into line with legal requirements. The court said Loro Piana Spa 'culpably failed' to adequately oversee its suppliers in order to pursue higher profits. Loro Piana could not immediately be reached for comment. LVMH, the world's biggest luxury group, acquired 80 per cent of Loro Piana in July 2013, leaving 20 per cent in the hands of the Italian family that founded the company. Loro Piana is the fifth fashion company to be targeted by the same Milan court over similar labour issues since December 2023, following Italian fashion group Valentino, an Italian unit of LVMH's Dior , Italy's Armani, and Alviero Martini, an Italian handbag company. Top stories Swipe. Select. Stay informed. Singapore Singapore to train more aviation and maritime officials from around the world Singapore Special edition SG60 Nets card now on sale for $10 Singapore 18 years' jail for woman who hacked adoptive father to death after tussle over Sengkang flat Business Singapore's economy sees surprise expansion in Q2 despite US tariff uncertainty: Advance estimate Singapore Jail, caning for man who had 285 child porn videos, including those showing infants Singapore Jail for woman who opened bank accounts that received over $640.7m, including scam proceeds Singapore Driver assisting with police probe after e-bike rider injured in hit-and-run in Hougang Sport After Olympic heartbreak, Singaporean swimmer Chantal Liew turns pain into inspiration The Milan court lifted the judicial administration it placed on Dior, Armani and Alviero Martini before the end of the one-year deadline imposed on them. The order against Valentino, on the other hand, is much more recent, dating back to May. REUTERS
