MILAN – A Milan court has ordered the revocation of the judicial administration imposed since April on Giorgio Armani Operations, a unit of the namesake designer’s fashion group, over the labor practices of its Chinese-owned subcontractors.
The Armani Group said in a statement that the decision to revoke the judicial administration was made because the company has taken all the necessary corrective action and “already had a structured and tested system of controls and protection of its supply chain.” The revocation came ahead of the one-year deadline initially expected, it pointed out.
The statement underscored that the decision was also made because the court recognized the group’s craftsmanship as Armani’s suppliers “are often to be identified as highly qualified artisans, especially regarding Italian production, characterized by the highest level of sophistication and quality.”
These skills and the use of fine materials are “a fundamental element for the creativity and excellent savoir-faire that have always distinguished the production of the Armani brand, as widely recognized and shared also by the court,” the statement added.
Last year, an Italian investigation was launched into alleged worker exploitation at several Chinese-owned firms in Italy producing luxury goods for the Armani Group, the Dior Group and Alviero Martini.
The statement issued on Wednesday concluded that “the preventive measure was decided against GAO due to the behavior of two of the numerous suppliers employed by the company who, in addition to violating the company’s code of ethics, betrayed the founding values of the Armani Group, which has never pursued profit as an end in itself and has never waived respect for workers and consumers. Thanks to the work done in recent months, a process of improvements already underway has been accelerated, making GAO a reference model for the category.”
As reported, judges had also placed an Italian subsidiary of Dior, which produced handbags for the French brand, under the same form of special administration, again for lack of control over its supply chain.
No update on this case was available on Wednesday as the investigations into the Dior practices began months later than those into Armani’s.
In July last year, Dior said it had suspended orders with the manufacturers in question, condemning “these unworthy acts,” and disputed some of the information that had been widely circulated in the media and sparked outrage on social media.
“Certain articles mention entirely false facts, firstly in indicating that the suppliers in question produced women’s handbags when they were solely participating in the partial assembly of men’s leather goods; and secondly that the production costs of these bags are ridiculously low. It should be noted that the profit margin of the house of Dior is entirely in line with that of the luxury industry and nothing of the order indicated by these erroneous comments,” Dior said at the time.
