MILAN — Tod’s and three of its managers are being investigated by prosecutors over suspected labor abuses, according to media reports. They are accused of allegedly ignoring the findings of inspections by local authorities in Tod’s subcontractors that are said to be Chinese owned.
Prosecutors claim the audit results allegedly raised concerns about working hours, pay and hygiene standards.
As reported, Italian prosecutor Paolo Storari has been investigating the company’s value chain since last year, unearthing alleged labor abuses and poor working conditions at a handful of its subcontractors in the Lombardy and Marche regions. The former were reportedly involved in the production of staff uniforms, while the latter were allegedly supplying footwear’s upper parts.
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In a statement issued Thursday, Tod’s SpA acknowledged that a day earlier the Corte di Cassazione, Italy’s equivalent of the Supreme Court, “rejected the requests and the appeal submitted by [prosecutor] Dr. Paolo Storari. Regarding the new allegations concerning the same matter, the company is now reviewing, with the same composure, the additional material, produced with worrying timing, by Dr. Storari.”
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Tod’s is not facing any criminal charges, but Milan prosecutors have requested that the Italian luxury brand be put under judicial administration. However, as reported, a Milan court and a Milan Appeals Court ruling dismissed the judicial administration procedure in relation to incidents in the Lombardy region and asked for the relocation to the Court of Ancona, in Italy’s Marche, for proceedings related to the incidents that allegedly occurred in the latter region. Storari appealed the decisions to the Corte di Cassazione, which led to the probe being uncovered.
Tod’s Group chairman and chief executive officer Diego Della Valle has expressed his criticism of the conduct of Milan prosecutors in their allegations of labor abuse in Tod’s supply chain.
A longtime champion of Made in Italy production, he said last month that he and his family, including his brother and vice chairman Andrea of the group, “make ethical values a pivotal factor in any situation, all the more so in business matters.”
He touted “absolute quality [of the group’s products imbued] with craftsmanship that we oversee in every possible way, with workshops, [employing] young people…in short, those who know us know these things, and to speak lightly about such topics as if we were truly criminals is, in my opinion, something to be ashamed of.” He warned against ignoring the ripple effect these accusations could have on Made in Italy.
On Thursday evening, Tod’s issued another statement commenting the day’s events reaffirming “its complete non-involvement in the matters under discussion.”
“Since legal proceedings are currently underway, we believe it is appropriate to address the matter exclusively within the official judicial venues, in order to avoid further confusion.
We would like once again to emphasize that our Group is widely regarded as a benchmark for professional conduct and has consistently given absolute priority to the health and quality of life of its employees.”
The statement stated that Tod’s will respond to the allegations “in the appropriate venues,” and that it considered “absolutely essential to establish rules that allow companies to operate with serenity while simultaneously ensuring a rigorous system of quality control and respect for the dignity of labor. By doing so, we can safeguard the reputation of Made in Italy worldwide and prevent doubts that could undermine consumer confidence. It is in this spirit that we have invited prosecutors to visit our facilities, as well as those of many other companies, to see firsthand the excellent quality of the workplaces and working conditions. The notion that Italian luxury companies sell expensive products while underpaying their workers is not only unfounded but also causes serious harm to our national system.”
The statement concluded by saying that, “understanding the disappointment our employees may feel when reading such unfounded reports, we take this opportunity to renew our full confidence in their dedication and in the outstanding contributions they make to the success of the Group.”
Like Tod’s probe, others made public over the past two years and involving, among others, Loro Piana, Valentino, Dior and Giorgio Armani alleged that the luxury brands failed to properly audit their value chain partners. As a result, brands have been put into judicial administration to correct and enhance audits and oversight through court-mandated procedures. Dior’s and Giorgio Armani’s probes were fully resolved and the judicial oversight lifted.
Della Valle noted that current law requesting companies to hit the third tier of the sub-supplying chain is hardly feasible.
Industry associations, including Camera Nazionale della Moda Italiana and Confindustria Moda, have been equally vocal about the need for a shared, nationwide auditing system. In September, top Italian fashion executives, from Renzo Rosso and Remo Ruffini to Gildo Zegna, showed a united front to safeguard the heritage and future of the Italian fashion industry.
In October, Camera Nazionale della Moda Italiana’s president Carlo Capasa; Luca Sburlati, president of Confindustria Moda, and Matteo Lunelli, president of Altagamma, among other association heads, met with the Ministry of Enterprises and Made in Italy Adolfo Urso in Rome to discuss draft laws tackling, on one side, the influx of ultra-fast-fashion products in the country and, on the other, a system to safeguard the supply chain from the infiltration of unlawful practices.