Shein beats well-known Australian brands on ethical fashion scores, but only 13% of companies can show they pay a living wage

Online fast-fashion giant Shein is outperforming several well-known Australian high-street retailers on ethical standards, according to an industry review. The 11th Baptist World Aid ethical fashion report, released on Tuesday, assessed the ethical practices of 138 Australian and international companies, representing 543 fashion brands.

The report's most sobering finding is that only 13% of the fashion companies surveyed could show evidence of paying a living wage to any of the workers in their supply chain. In other words, the vast majority of companies could produce no such evidence at all.

The organisation surveys companies on five broad supply chain topics, including worker empowerment and environmental sustainability, to score brands out of 100. The scores rest on how companies protect workers and the environment across every stage, from gathering raw materials and producing fabric and plastic to manufacturing garments.

The ultra-fast fashion website Shein was given a score of 28. The Chinese e-commerce company has long been criticised for its environmental impact and accused of facilitating or even encouraging overconsumption through its very cheap prices. Yet while the score sits below the average of 31.5, Shein beat several well-known retail companies including Myer, Windsor Smith, Ghanda and Quiksilver owner Boardriders.

At the very bottom of the table were Ghanda and Windsor Smith, both rated zero. Shein's competitor Temu, another Chinese e-commerce website, also received a score of zero. The swimwear label Seafolly was given a score of one. Activewear maker 2XU scored two, while Boardriders, which also owns the surf brands Roxy and Billabong, and formal wear favourite Bec and Bridge both scored three. Myer scored 20 for its retail arm and its apparel business.

There is, however, an important caveat behind the comparison. This year Shein supplied Baptist World Aid with additional information, whereas Myer, Seafolly, Ghanda, Windsor Smith, Boardriders, 2XU and Bec and Bridge did not. Companies that did not participate in the research project were assessed only on their publicly available information, which tends to yield a lower ranking.

Baptist World Aid said its researchers undertook a rigorous engagement process to ensure that all assessed companies were aware of their inclusion in the research, had the opportunity to participate, and were informed of the key project timelines. A spokesperson said that over a 13-month engagement period companies were contacted via email on approximately 16 occasions, including when they were sent their final score.

Overall, more than half of the companies analysed did not respond to the researchers: 58% of the businesses were assessed solely on their publicly available information, compared with 42% who provided more. To determine the scores, the researchers analysed more than 15,000 data points generated by assessing company policies, practices and performance.

The report also turned a spotlight on Australia's own consumption. The country ranks as the world's highest consumer of textiles per person, with more than 200,000 tonnes of clothing ending up in landfill every year. In the report's words, overproduction particularly remains a growing challenge to sustainability.

The highest-scoring brands were those that could demonstrate they were meeting a wide range of criteria, for example conducting factory audits, providing workers' rights training, and assessing the environmental effects of their top three fibres. Denim brands were among the top performers this year, alongside intimates apparel, outdoor and technical performance gear, and some luxury labels. The Australian underwear label Mighty Good Basics received the highest score of 94, though the report described the company as an outlier.

Baptist World Aid's ethical fashion lead, Katherine Halliday, defended the methodology, saying the report is designed to answer the question: 'How strong are the systems a company has to protect exploitation of workers across the supply chain?' She said she was heartened that Shein's score had improved from previous years, which she attributed to public scrutiny and a resulting change in the company's practices.

The overall picture, though, is one of stagnation. Since the previous report was released in 2024, the average overall score has improved by just 0.2%. Halliday said that although more companies had committed to improving their ethical standards, this had not necessarily translated into tangible change for workers. 'A modern slavery statement, for example, isn't enough to move the needle on these practices,' she said. The stagnating scores showed that more government action was needed to compel fashion companies to improve their practices.

Temu, for its part, said all its sellers had to comply with a third-party code of conduct, which prohibits forced, penal or child labour and requires compliance with applicable laws on wages and working hours, as well as safe working conditions. The other companies named in the report have been contacted for comment.