18 September, 2026

The rise of Shein marked a new era of ultra-fast fashion. But its recent IPO struggles raise questions about the long-term viability of its business model.  

After facing scrutiny over its supply chain and environmental record, Shein abandoned plans to list in London and New York, turning instead to the Hong Kong Stock Exchange. Upon its debut, the company was valued at around $27 billion, roughly 70% lower than its peak valuation of nearly $100 billion in 2022. 

Shein has faced long-running criticisms for its model, which is built on extreme speed and scale. The company reportedly uploads between 2,000 and 10,000 products to its app every day, fuelling a constant cycle of consumption through ultra-low prices. Alongside concerns about waste and emissions, there have also been allegations of poor labour conditions and child labour within its supply chain. In many ways, Shein embodies fast fashion’s central contradiction: a model built on producing vast quantities of cheap clothing is incompatible with true sustainability. 

But what makes this story particularly interesting is what it may tell us about investors and how their views are changing. ESG has often been treated as a secondary consideration, separate from a company’s financial performance. However, Shein’s downturn suggests that this distinction is becoming harder to maintain. Increasingly, environmental risks are being viewed as business risks, with investors asking whether unsustainable business practices can undermine long-term value. 

Some experts caution against reading too much virtue into this. They argue that investors are not abandoning Shein out of pure altruism or climate concern, but are simply responding to financial and regulatory risks. 

There’s some truth to that. But this distinction may matter less than it seems. Companies do not affect society and the environment without consequences; these impacts eventually loop back and hit company performance. Externalities rarely stay external forever. Whether through regulation, consumer backlash or operational disruption, the costs of unsustainable practices often find their way back on to the balance sheet. 

So perhaps investors aren’t having a moral awakening. But if environmental and social risks are increasingly shaping how businesses are being valued, the outcome could still be significant. Shein’s story suggests that growth at the expense of people and the planet is becoming harder to sell, not just to consumers, but to investors too. 

By Charity Rymer