Nigel Farage and I agree on one thing: a red-carpet welcome at the London Stock Exchange for Shein, the Chinese online fashion retailer, would be ‘a very bad idea’. Valued at £50 billion, Shein could become London’s biggest-ever initial public offering. Both the departing Chancellor Jeremy Hunt and the shadow business secretary Jonathan Reynolds have met Shein’s chairman, Donald Tang, to encourage that prospect. Both clearly recognise that the City’s global status is weakened by a dearth of LSE debutants and a fad for listing in New York instead – with yet another FTSE 100 company, the £24 billion plant-hire giant Ashtead, reported to be thinking of shifting its listing across the Atlantic.
But could Shein turn the tide? Not according to Farage, who thinks what the LSE really needs is deregulation to free it from residual EU shackles. And not according to human-rights watchers, who observe that Shein is thinking about coming here only because its plans for a New York launch have been blocked by critics over there.
Founded in Nanjing in 2008 but now headquartered in Singapore, Shein grew to be the world’s largest clothing retailer by harvesting consumer data through social media channels and responding to fashion whims by rapid sourcing of cheap garments from third-party factories across mainland China. That business model gives rise to obvious environmental concerns. More significantly, a group of US congressmen wrote last year to the Securities and Exchange Commission accusing Shein of ‘utilising underpaid labour in its supplier factories’ – possibly (though Shein strongly denies the allegation) including Uighur forced labour in Xinjiang province.
‘The ability to issue securities on our domestic exchanges is a privilege and foreign companies wishing to do so must uphold a commitment to human rights,’ wrote the congressmen. Underlying their righteous tone may be basic American hostility towards Chinese economic might. Even so, they’re right that the world’s leading stock exchanges should maintain the highest ethical standards. Is London so desperate that it must kowtow to Shein?
Hostage released
The acquittal of Mike Lynch after a 12-week trial in San Francisco on multiple charges of fraud is a triumph for his legal team – as well as a tribute to his own resilience.
Lynch’s Cambridge-based software company Autonomy was acquired by Hewlett Packard of the US for $11 billion in 2011. The following year, new management at HP claimed they had been sold a false package and wrote off most of the purchase price. Lynch’s response was that HP had destroyed Autonomy’s value by mishandling an acquisition it did not understand, while he himself had not been closely involved in the detail of the deal.
The UK Serious Fraud Office found insufficient evidence to mount a criminal case against Lynch. But a High Court judge ruled against him in a civil fraud case, which remains to be settled, and his finance director Sushovan Hussain had already been convicted in the same court that awaited Lynch. When his extradition proceeded last year, most observers – including me – believed he was destined for an extended stay in jail.
Why? Because only one in eight US fraud prosecutions ends in acquittal, most defendants plea-bargaining because they literally cannot afford to hold out for ‘not guilty’. Lynch was rich enough not to worry about costs and sufficiently self-confident (an attribute he’s never lacked) to face his accusers from the witness box – but still his fate looked sealed.
The prosecution called 35 witnesses against the defence’s six; the judge excluded key evidence of disagreement over the Autonomy write-down; Lynch’s side even petitioned for mistrial after the prosecutor ‘asked highly improper questions intended to prejudice the jury against Dr Lynch because he is wealthy’. But in the end the jury threw the case out and Lynch’s lawyers spoke of ‘a resounding rejection of the [US] government’s profound overreach’ – both in its use of the ‘asymmetrical’ US-UK extradition treaty of 2003 (which I have repeatedly criticised here) and in its pursuit of a charge sheet that’s left looking like a cover story for HP incompetence.
A hostage released from the clutches of US justice, Lynch has bills to pay, scars to bear and detractors who would have relished his fall – but now returns to the podium of top UK tech entrepreneurs.
Solar storm
Have you watched the proliferation of solar arrays across English farmland and wondered about the trade-off between renewable energy and food security: how many tons of spuds equals a megawatt of clean power? Claire Coutinho MP, as secretary of state for energy security and net zero, made a pertinent statement last month on protecting ‘our best and most versatile’ agricultural land while steering solar towards rooftops and brownfield sites. But what Conservative soon-to-be-ex-ministers say about anything barely matters any more. What Labour says, in its ‘Green Prosperity Plan’, is that it will ‘more than triple solar power’ by 2030.
And if you want a sense of what that might do to your countryside, take a look at the Lime Down Solar Park project in Wiltshire and weep. This 500-megawatt, 2,000-acre scheme claims it will power 115,000 homes – and is backed by the Irish billionaire Denis O’Brien alongside the Australian investment bank Macquarie, following its notorious work at Thames Water. To quote the local Tory candidate James Gray, it’s ‘an absolutely monstrous destruction of some of the most lovely landscapes’ in the county at a time when ‘our highly productive farms should be producing food, not sacrificed on the altar of climate change’. But the scheme’s local opponents are up against powerful forces of finance and influence – and I’ll bet Ed Miliband, if it’s he who holds Labour’s energy portfolio, is just itching to approve it.
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