WEBVTT - Why a Potential $64 Billion London IPO Is Controversial 0:00:03.120 --> 0:00:07.840 Bloomberg Audio Studios, podcasts, radio news. 0:00:11.080 --> 0:00:14.280 Mag Have you ordered anything from Shane I imagine The 0:00:14.320 --> 0:00:16.160 answer is god no. 0:00:15.720 --> 0:00:20.480 Imagine like no, I have a guilty sha Former. 0:00:27.600 --> 0:00:29.840 Welcome to the City of London. 0:00:29.560 --> 0:00:31.720 The City of the city, the City of London. 0:00:34.400 --> 0:00:38.440 Please mind the gap between the and the platform, the 0:00:38.479 --> 0:00:46.879 financial hearts of the country. 0:00:44.760 --> 0:00:46.000 The city, the city. 0:00:46.440 --> 0:00:51.760 Welcome to in the city, clear of the door. 0:00:54.040 --> 0:00:55.960 Hi everyone, good to have you back for another week 0:00:56.000 --> 0:00:58.600 of In the City, where we unpack the stories dominating 0:00:58.600 --> 0:01:02.240 the conversations of policymakers and power brokers the world over. 0:01:02.320 --> 0:01:03.200 I'm fronting Laqua. 0:01:03.520 --> 0:01:05.080 I'm alegra Stratton Alecra. 0:01:05.160 --> 0:01:07.440 Have you ever ordered anything from the Chinese fast fashion 0:01:07.520 --> 0:01:08.680 giant shean. 0:01:08.880 --> 0:01:09.959 On thousand percent. 0:01:10.080 --> 0:01:12.560 No, I'm unsurprised. 0:01:12.880 --> 0:01:17.679 Actually no, I'm upset that you're unsurprised, but no, clearly 0:01:17.760 --> 0:01:21.319 clearly so I came across it obviously in the work 0:01:21.360 --> 0:01:26.119 we do on sustainability, because it has a very bad 0:01:26.319 --> 0:01:29.760 environmental impact. I think the algorithm is very interesting. So 0:01:29.800 --> 0:01:32.240 the idea that they can see really quickly what's popular 0:01:32.280 --> 0:01:33.920 and then they make more of those. So I think 0:01:33.920 --> 0:01:37.880 that is fascinating and obviously innovative, but it's being used 0:01:37.880 --> 0:01:38.760 to the wrong ends. 0:01:39.120 --> 0:01:40.920 So it's an interesting story because, on the one hand, 0:01:40.920 --> 0:01:43.680 if the listing does go ahead, then it has a 0:01:43.720 --> 0:01:47.480 possible valuation of fifty billion pounds, so it'd be big 0:01:47.600 --> 0:01:49.560 enough to quiet some of the doomsday chatter around the 0:01:49.600 --> 0:01:53.160 ukipl market. But then, as you say, there's ethical questions. 0:01:53.520 --> 0:01:57.240 Yes, and very very recently, a couple of years ago, 0:01:57.320 --> 0:01:59.440 the City of London was talking a lot about being 0:01:59.440 --> 0:02:02.440 the global center of green finance. So what does that mean, Well, 0:02:02.480 --> 0:02:04.280 it means a number of things, but including it is 0:02:04.320 --> 0:02:07.640 that we have regulations that are supposed to get companies 0:02:07.680 --> 0:02:11.600 to demonstrate their transitioning away from carbon intensive activities, which 0:02:11.639 --> 0:02:14.320 is I think would be a stretch for Shining, sorry, 0:02:14.440 --> 0:02:16.080 a stretch for Shin to demonstrate. 0:02:16.240 --> 0:02:17.680 Yeah, we're not sure how to pronounce it. 0:02:17.880 --> 0:02:20.000 So in today's episode, it's Shine from now on. 0:02:20.560 --> 0:02:22.440 In today's episode, we're going to talk about what it 0:02:22.520 --> 0:02:24.799 means for London now that it's inching closer to a 0:02:24.880 --> 0:02:28.080 listing with US opinion calmness to Andrew Felsched, who definitely 0:02:28.120 --> 0:02:30.800 knows how to pronounce it. She oversees consumer goods and 0:02:30.840 --> 0:02:35.600 the retail industry and Alvaret reporter and read Out newsletter 0:02:35.720 --> 0:02:38.040 writer as well, So thank you both for joining us. 0:02:38.080 --> 0:02:42.520 Andrew talk to us about She Shining, like how many 0:02:42.560 --> 0:02:43.720 clothes do they sell and make? 0:02:44.800 --> 0:02:49.280 They had failed last year of twenty three billion dollars 0:02:49.840 --> 0:02:53.040 and they said they want to increase that to sixty 0:02:53.080 --> 0:02:56.720 billion by twenty twenty five, so that you know, that 0:02:56.720 --> 0:02:59.760 would be sixty billion, would be ahead of Indetect, which 0:02:59.880 --> 0:03:02.680 is it's, you know the world's biggest sort of clothing retailer. 0:03:03.360 --> 0:03:06.880 So you know, it is very sizable. 0:03:06.639 --> 0:03:09.280 Into technics, is Zara and so on? 0:03:09.360 --> 0:03:14.600 Isn't it Bara? Yes, exactly, So I mean it's very sizable. 0:03:15.560 --> 0:03:19.440 It's not like a conventional retailer. It doesn't have shots, 0:03:19.960 --> 0:03:23.320 it doesn't have you know, warehouses here, and it picks 0:03:23.320 --> 0:03:26.320 things out see what people are wearing on social media. 0:03:26.639 --> 0:03:30.120 It comes them through its algorithms system, and that goes 0:03:30.160 --> 0:03:34.600 to five thousand suppliers in China and then the sin 0:03:34.800 --> 0:03:40.360 ship thing it ships things from China direct to consumers 0:03:40.400 --> 0:03:43.400 in the US and the UK. So I think the 0:03:43.480 --> 0:03:46.920 first question for investor is what exactly are you being 0:03:47.040 --> 0:03:49.400 asked to buy shares in this ica? 0:03:49.880 --> 0:03:53.960 Andrew, I'm on the website. So first of all, right, 0:03:54.080 --> 0:03:55.480 and I see, I mean they're telling me I can 0:03:55.480 --> 0:03:59.760 get a shean vacation woman's flower ensemble for a three 0:03:59.720 --> 0:04:03.280 pound forty nine. I mean, has it possible to make 0:04:03.320 --> 0:04:05.120 anything for three pounds? 0:04:05.480 --> 0:04:10.000 Well, they claim that their system is very efficient, and 0:04:10.040 --> 0:04:14.040 what will happen. They will they will only make one 0:04:14.160 --> 0:04:18.720 hundred to two hundred pieces of any item, and then 0:04:18.760 --> 0:04:22.039 if it proves popular lots of people like that flower ensemble, 0:04:22.680 --> 0:04:26.600 then they will decide to make more. And they claim 0:04:26.640 --> 0:04:29.560 that that is very efficient and that's the way they 0:04:29.560 --> 0:04:33.640 can keep prices down. Now British retailers have another view 0:04:34.320 --> 0:04:38.919 because these items which are you know, typically you just 0:04:38.960 --> 0:04:43.160 mentioned very cheap, they come direct from China. If they're 0:04:43.200 --> 0:04:45.960 a hundred, one hundred and thirty five pounds each, they're 0:04:45.960 --> 0:04:48.479 all in small packages. The beach one is under one 0:04:48.560 --> 0:04:52.359 hundred and thirty five pounds. It doesn't pay tax on 0:04:52.440 --> 0:04:56.560 that order, so that immediately it doesn't attract taxes. That 0:04:56.600 --> 0:05:00.440 immediately makes things chink, and all retailers make them authority 0:05:00.560 --> 0:05:04.039 of their product. Now in Asia might not necessarily China. 0:05:04.440 --> 0:05:06.960 Lots of moved out China, but they will bring those 0:05:07.000 --> 0:05:10.800 over and containers to UK distribution centers and then they 0:05:10.920 --> 0:05:14.400 will you know, get them out to consume homes or 0:05:14.480 --> 0:05:18.160 to their doors, so that they want that crack down 0:05:18.240 --> 0:05:22.200 on because you know, they're saying that that does make 0:05:22.240 --> 0:05:23.000 things cheaper. 0:05:23.880 --> 0:05:27.600 However, it's difficult for an incoming labor government, isn't it. 0:05:27.600 --> 0:05:29.800 We're on one hand, well not. On the one hand, 0:05:29.839 --> 0:05:33.120 you have a huge part of that party is interested 0:05:33.160 --> 0:05:38.320 in environmental protections and standards. Another part of it, overlapping 0:05:38.520 --> 0:05:42.200 but slightly different, is interested in workers' rights. But then 0:05:42.200 --> 0:05:45.320 there's that central core interested in all those things too. 0:05:45.400 --> 0:05:48.599 But they're wanting to demonstrate that the city of London 0:05:48.800 --> 0:05:50.560 is going to be back on its feet very quickly. 0:05:50.800 --> 0:05:53.200 So it's a bit of a headache for them a bit. 0:05:53.360 --> 0:05:53.560 Yeah. 0:05:53.920 --> 0:05:57.880 We have reporters or I reported with with colleagues that 0:05:58.960 --> 0:06:02.120 Labor is not going to block this, that they've had 0:06:02.279 --> 0:06:04.719 various meetings with she and FIRSU and DeVos or in 0:06:04.760 --> 0:06:07.640 London arranged by the London Stock Exchange, and they basically 0:06:07.680 --> 0:06:10.120 gave them assurances that they're not going to block it. 0:06:10.480 --> 0:06:13.840 So they have made their decision. The headline is that 0:06:14.440 --> 0:06:17.120 they are open to this because it's a big listing, 0:06:17.520 --> 0:06:23.120 but they are careful to add a certain number of caveats, 0:06:23.160 --> 0:06:26.760 I suppose. So you mentioned the sort of the concern 0:06:26.800 --> 0:06:30.240 over workers' rights, I mean some particularly concerning stories about 0:06:30.720 --> 0:06:33.719 basically slave labor in Shinjang, which she and has denied. 0:06:36.000 --> 0:06:40.200 Labor is saying that the benefit of she enlisting here 0:06:40.320 --> 0:06:42.960 would be that she and would then be subject to 0:06:43.080 --> 0:06:46.880 UK employment regulations, and so it's actually better to have 0:06:46.920 --> 0:06:49.640 a company like that being brought under UK regulation, And 0:06:49.680 --> 0:06:52.320 they want even more places listing in the UK so 0:06:52.360 --> 0:06:55.600 they can regulate them in line with British law. Essentially, 0:06:55.960 --> 0:06:58.880 I'm not really sure if that will wash with parts 0:06:58.880 --> 0:07:01.160 of the Labor Party. I mean you mention and the 0:07:01.760 --> 0:07:04.760 concern about environmental standards, which is a big concern with 0:07:04.839 --> 0:07:07.440 she and in fast fast fashion. But also you know, 0:07:07.480 --> 0:07:10.680 it's called the Labor Party, it's the it's the it's 0:07:10.720 --> 0:07:13.840 the party of organized Labor of workers. That the clues 0:07:13.840 --> 0:07:17.000 in the name Angela Rayner is making a big part 0:07:17.000 --> 0:07:20.120 of her sort of mission as Deputy Prime Minister shoring 0:07:20.200 --> 0:07:23.280 up workers rights. There are loads of concerns about that, 0:07:23.360 --> 0:07:26.000 but there's also, i think the more complicated thing about 0:07:26.040 --> 0:07:28.640 their Securonomics. 0:07:29.280 --> 0:07:29.640 Offer. 0:07:29.960 --> 0:07:33.640 So they basically have made this pitch that their economic 0:07:33.720 --> 0:07:38.720 model will be one that shores up UK security at home, 0:07:39.200 --> 0:07:44.320 so not having to outsource things like energy to foreign pars, 0:07:45.240 --> 0:07:49.800 but then also just sort of protecting bits of British 0:07:49.840 --> 0:07:52.720 industry from Chinese influence and so she and it was 0:07:53.000 --> 0:07:55.640 sort of originated in China, It's not based out of Shanghai, 0:07:55.880 --> 0:07:58.640 but this is sort of essentially putting a big Chinese 0:07:58.920 --> 0:08:03.280 company on the London Stock Exchange. Their concerns there as well. 0:08:03.320 --> 0:08:06.200 But al I mean, I feel like it's difficult to regulate, right, 0:08:06.200 --> 0:08:07.800 I mean if they don't have their employees here, if 0:08:07.800 --> 0:08:10.320 the supply chains are here, I don't see how any regulator, 0:08:11.040 --> 0:08:12.760 you know, based in the UK would be able to 0:08:13.320 --> 0:08:17.160 give workers' rights to someone who abroad. And the SEC 0:08:17.200 --> 0:08:19.080 also said that it wasn't too keen to have them 0:08:19.080 --> 0:08:21.040 on because of some of these concerns. 0:08:21.120 --> 0:08:23.160 But also think of the business model, right. The reason 0:08:23.160 --> 0:08:26.040 why that that fetching whatever that number is you're looking 0:08:26.080 --> 0:08:29.080 online and probably going to buy is three pounds forty with. 0:08:29.040 --> 0:08:29.920 The flower ensemble. 0:08:29.960 --> 0:08:31.560 As soon as you start to regulate, then you're going 0:08:31.600 --> 0:08:33.520 to push up the cost of various different bits of 0:08:33.520 --> 0:08:36.040 their model, so you're going to break the way that 0:08:36.080 --> 0:08:36.800 they make money. 0:08:36.880 --> 0:08:38.840 But I wonder whether the Labor Party feel like there's 0:08:38.840 --> 0:08:40.599 so much under pressure because they want to show that 0:08:40.640 --> 0:08:42.439 their business friend they almost at any cost. 0:08:42.720 --> 0:08:45.280 Yeah exactly. I mean, as you say, the minute you 0:08:45.320 --> 0:08:47.839 start probing that line, you think, how does that really work? 0:08:47.920 --> 0:08:49.520 You know, you're not necessarily going to be based in 0:08:49.520 --> 0:08:54.240 the UK, you're just listing here. But that's kind of 0:08:54.559 --> 0:08:56.600 their argument that they have to make really to keep 0:08:56.720 --> 0:08:59.120 parts of the party happy. But they've clearly just made 0:08:59.160 --> 0:09:02.640 this calculation that they don't want a big headline Labor 0:09:02.760 --> 0:09:06.720 blocks the possible biggest listing ever in London on the 0:09:06.760 --> 0:09:09.800 London Stock Exchange, that they are just they just want 0:09:09.840 --> 0:09:12.440 to be seen to be pro business, pro growth. So 0:09:12.640 --> 0:09:15.000 much of actually what they want to do in government 0:09:15.040 --> 0:09:17.640 is reliant on private sector investment because they don't feel 0:09:17.640 --> 0:09:20.079 like they have much money themselves. So many of their 0:09:20.080 --> 0:09:22.400 models are sort of government puts in one point hoping 0:09:22.400 --> 0:09:25.000 that you get four point from the private sector. So 0:09:25.040 --> 0:09:28.760 they are really reliant on just vibes and that message 0:09:28.800 --> 0:09:31.520 to the private sector, hoping that they can make up 0:09:31.520 --> 0:09:33.920 the difference where they're not investing, the private sector can, 0:09:34.160 --> 0:09:37.319 and they're putting that basically above all those other concerns. 0:09:37.480 --> 0:09:39.960 Andrew, you wrote that you know London needs to be careful. 0:09:40.000 --> 0:09:42.720 It doesn't well, it doesn't become the sloppy seconds to 0:09:42.800 --> 0:09:46.359 New York. Does it actually I mean, you're right instinctively, 0:09:46.440 --> 0:09:50.280 but does it actually matter. There are people commentators out 0:09:50.280 --> 0:09:53.959 there that we don't read as much as we read you, Andrea, 0:09:54.000 --> 0:09:57.280 but they are saying, you know, London needs to be 0:09:57.360 --> 0:10:00.559 careful about about Alva's point about vibes, to be careful 0:10:00.559 --> 0:10:02.880 about the sort of id it's presenting to the world 0:10:03.160 --> 0:10:05.480 by being the place that is happy to have this listing. 0:10:06.559 --> 0:10:09.240 I totally agree. I think that is the bigger danger. 0:10:09.520 --> 0:10:13.360 Whenever you look at this, there is risk with this company, 0:10:14.080 --> 0:10:16.800 and to say that, you know, we want something that 0:10:17.000 --> 0:10:20.400 is this risky, I don't think sends a great message 0:10:20.480 --> 0:10:23.600 that said everything got to prime. So what you've got 0:10:23.640 --> 0:10:26.840 with san is you've got these risks that you've also 0:10:27.000 --> 0:10:30.199 got a high valuation. We don't have all the numbers, 0:10:30.200 --> 0:10:31.920 you know, I had to make a lot of assumption 0:10:32.120 --> 0:10:34.840 to figure out what it would work, but I got 0:10:34.840 --> 0:10:39.679 to basically a similar rating to Indetect. And when you think, 0:10:39.679 --> 0:10:43.319 you know in Detect is you know the biggest clothing retailer, 0:10:43.800 --> 0:10:46.319 it's you know, it's aren't its track record for many 0:10:46.400 --> 0:10:52.160 years doing phenomenally well. Zara, and you've got she In, which, 0:10:52.200 --> 0:10:55.000 as we've discussed, has all these issues, is coming in 0:10:55.040 --> 0:10:57.280 at the same value toation. Okay, so we've blund and 0:10:57.440 --> 0:11:00.760 wants it. It's got to be prime to the fact 0:11:00.840 --> 0:11:03.839 that you make invested comfortable with the risk. 0:11:04.040 --> 0:11:05.720 I just want one more from me, but it's probably 0:11:05.720 --> 0:11:08.440 a bit niche inter Tech is interesting because with Zara 0:11:08.640 --> 0:11:11.000 you can actually see their price point is it's not 0:11:11.040 --> 0:11:13.400 as low as she In, but it is it is 0:11:13.440 --> 0:11:16.480 not extortionate either. But what you're seeing is they're putting 0:11:16.520 --> 0:11:19.160 some of their money, not enough for some campaigners, but 0:11:19.240 --> 0:11:21.400 some of their money into innovation to bring in the 0:11:21.440 --> 0:11:25.120 fabrics that are lower impact on the environment. So you 0:11:25.160 --> 0:11:27.640 know there is that there are actually these models out there. 0:11:27.920 --> 0:11:31.800 The debate is can you actually have environmental fast fashion? 0:11:31.880 --> 0:11:33.000 Like is it an oxymoron? 0:11:34.120 --> 0:11:34.360 Yes? 0:11:34.720 --> 0:11:37.559 Exactly that they are all trying, not just in Detect, 0:11:37.559 --> 0:11:40.720 I mean H and M. It really has been doing 0:11:40.760 --> 0:11:43.080 a lot on this big years it was it's put 0:11:43.200 --> 0:11:46.160 you know, sustainability at the heart of the business model. 0:11:46.200 --> 0:11:49.760 Even Primart. We think Primar is very fast fashion. They're 0:11:49.760 --> 0:11:53.439 doing a lot with recycled fabrics and. 0:11:53.880 --> 0:11:55.600 You know they are all is possible. 0:11:55.640 --> 0:11:59.319 Basically it's possible. I mean, you're not going to get 0:11:59.360 --> 0:12:03.400 a zero you know, impact from pass fashion. But the 0:12:03.440 --> 0:12:06.360 more you can get people to just wear things more 0:12:06.600 --> 0:12:11.559 no handt minimized the impact. And let's forget even luxury 0:12:11.920 --> 0:12:14.680 isn't risk free. You know, a lot of luxury you've 0:12:14.679 --> 0:12:17.439 got things would like the leather, the metal class for 0:12:17.559 --> 0:12:22.600 Kashma all. Yeah, all of these things have environmental. 0:12:22.240 --> 0:12:24.560 I think the big caveat and all of this is 0:12:24.559 --> 0:12:28.080 that even though I've said Labor has given she in 0:12:28.120 --> 0:12:31.360 reassurances that they won't block this, they caveat that was 0:12:31.440 --> 0:12:33.720 saying that they haven't done their full due diligence yet. 0:12:34.160 --> 0:12:37.720 And so even though she has sort of begun the 0:12:37.720 --> 0:12:40.040 process of listing in London, we know that that won't 0:12:40.080 --> 0:12:42.000 happen until the end of the summer, which means that 0:12:42.040 --> 0:12:44.920 even though we're in a general election campaign, Parliament will 0:12:44.920 --> 0:12:48.160 be back before this can happen. And there are Labor 0:12:48.200 --> 0:12:51.600 backbenchers people like Liam Burn who have concerns about this 0:12:52.480 --> 0:12:54.840 and who do want to have parliamentary scrutiny if she 0:12:54.960 --> 0:12:57.680 in before it can list in London. So I don't 0:12:57.679 --> 0:12:59.480 think that this is a done deal by any means. 0:12:59.760 --> 0:13:01.760 We can see the direction of travel from the Labor 0:13:01.800 --> 0:13:04.720 government in terms of them just wanting this big listing. 0:13:05.240 --> 0:13:06.880 But what will happen? 0:13:06.679 --> 0:13:10.280 Who is an election? Maybe Jeremy Hunt. 0:13:10.880 --> 0:13:12.360 But the thing is that we don't know how bad, 0:13:12.400 --> 0:13:15.760 how actually how bad for a lack of a better term, 0:13:15.840 --> 0:13:18.400 Shean actually is right. I mean Primark is maybe the 0:13:18.480 --> 0:13:21.160 closest we could compare her to. I mean they went 0:13:21.200 --> 0:13:25.679 through like factory collapses. This is not only not environmentally, 0:13:26.120 --> 0:13:28.720 this is you know, could we could look at child labor. 0:13:28.760 --> 0:13:31.600 Do we have any of those facts of how it 0:13:31.679 --> 0:13:34.120 actually operates or is that what labor is waiting for? 0:13:35.360 --> 0:13:37.920 Well, definitely they would say that they've had a lot 0:13:37.920 --> 0:13:41.240 of questions in their meetings with Sheen. But it's interesting 0:13:41.280 --> 0:13:43.640 that they they have mentioned a lot of the lines 0:13:43.640 --> 0:13:45.679 that I heard from Andrea there, you know that pitch 0:13:45.760 --> 0:13:48.560 that they're actually not as environmentally bad as they say 0:13:48.600 --> 0:13:50.880 they are because they aren't built, they aren't making all 0:13:50.880 --> 0:13:55.920 those clothes right away. They're seeing which ones perform. Well, 0:13:56.120 --> 0:14:00.160 they commission a lot, make us more, Yeah, exactly. And 0:14:00.800 --> 0:14:02.480 you know, so they've been kind of making that pitch 0:14:02.559 --> 0:14:05.720 to labor. Labor signs kind of persuaded by it, and 0:14:05.760 --> 0:14:08.160 maybe because they're hearing what they want to hear. But 0:14:08.520 --> 0:14:10.480 definitely there is that big caveat they haven't their full 0:14:10.559 --> 0:14:13.720 due diligence. You know, there have been some very concerning 0:14:13.800 --> 0:14:17.640 stories of actually and in multiple directions. So I don't 0:14:17.640 --> 0:14:19.400 think that this is a done deal. And I especially 0:14:19.440 --> 0:14:22.560 think the Conservatives, if they are in opposition, there's so 0:14:22.760 --> 0:14:26.280 much sort of China skepticism. We saw what happened over Huawei. 0:14:26.640 --> 0:14:29.000 I think you could really see this crystallizing as a 0:14:29.040 --> 0:14:31.280 sort of early issue the next government. 0:14:32.000 --> 0:14:33.280 Nigel Farage is against it. 0:14:34.120 --> 0:14:35.920 But this is also it comes on the back of 0:14:36.040 --> 0:14:38.640 you know, maybe the last ten to fifteen years loads 0:14:38.640 --> 0:14:40.560 of listings from Russia. I mean, we had all the 0:14:40.560 --> 0:14:44.360 medals right companies being listed here and that then went 0:14:44.360 --> 0:14:45.120 on to bagfire. 0:14:45.280 --> 0:14:46.840 So this is this is the thing rand I mean 0:14:46.880 --> 0:14:48.960 that that you know, if you were to marshall Defense, 0:14:49.240 --> 0:14:54.680 you would say that many companies listed in London have 0:14:55.320 --> 0:15:00.480 not fantastic environmental standards, but we're you know, we have 0:15:00.560 --> 0:15:02.160 as you say, mining, we have lots of oil and 0:15:02.200 --> 0:15:06.040 gas and so on. What against that is actually a 0:15:06.040 --> 0:15:07.760 lot of the regulations that have come in the last 0:15:07.760 --> 0:15:10.960 couple of years have expected and put expectations on them 0:15:11.000 --> 0:15:14.080 to do transition plans and to be demonstrating that they 0:15:14.200 --> 0:15:16.120 have maps and understand their carbon emissions. 0:15:16.200 --> 0:15:17.640 But I think, and I would argue and Andrew, it 0:15:17.680 --> 0:15:19.920 probably the best place to answer this that you can 0:15:20.000 --> 0:15:24.720 have a company that pollutes because of fossil fuel, which 0:15:24.760 --> 0:15:27.920 is maybe different to child labor, which we don't know 0:15:27.960 --> 0:15:30.360 if that's happening, Andrew. But how difficult is it on 0:15:30.440 --> 0:15:33.600 such a large I mean, if they're valued at fifty 0:15:33.640 --> 0:15:37.080 billion or thereabouts, this is a massive company. Supply chains 0:15:37.360 --> 0:15:39.440 are probably all over the world. A lot of them 0:15:39.480 --> 0:15:41.880 are ear in China, So how difficult is it to 0:15:42.000 --> 0:15:44.400 have that due diligence to understand where they do them. 0:15:45.480 --> 0:15:49.400 One way to maybe think about that is they've got 0:15:49.440 --> 0:15:54.320 they talk about five thousand supplies. A high street retailer 0:15:55.080 --> 0:15:59.000 in the UK would have hundreds of suppliers. So immediately 0:15:59.120 --> 0:16:02.720 you've gotten bigger. Now she And say that last year 0:16:02.840 --> 0:16:08.080 they audited ninety five percent of their suppliers and only 0:16:08.120 --> 0:16:12.880 a very small amount were found to not be compliant 0:16:12.960 --> 0:16:17.120 and they stopped working with those. So that's all very good, 0:16:17.520 --> 0:16:22.240 But I think I think it's just scale that thousands hundreds. 0:16:22.280 --> 0:16:25.000 So if you've got a high street retail of hundreds 0:16:25.040 --> 0:16:28.880 of suppliers, they all have like a lot of auditors 0:16:28.880 --> 0:16:32.400 on the ground. So for five thousand suppliers, you need 0:16:32.880 --> 0:16:35.560 even more auditors on the ground. I think she AND's 0:16:35.600 --> 0:16:37.920 got to come out and show what it's doing in 0:16:37.960 --> 0:16:42.120 its supply chain, show that how it's auditing, how often 0:16:42.160 --> 0:16:46.240 it's auditing, how many auditors it've got, what they find 0:16:46.800 --> 0:16:50.280 and what they do if they find something they don't like, 0:16:50.400 --> 0:16:52.200 and how they're getting rid of it. I think it 0:16:52.400 --> 0:16:56.000 got it's really got to explain that, you know, in 0:16:56.120 --> 0:16:57.880 great detail, and it will you know, if it lists, 0:16:57.880 --> 0:17:01.160 it will have a prospectus, and it's really got to 0:17:01.200 --> 0:17:03.080 set that out as much as it can. 0:17:03.760 --> 0:17:05.479 You're right, Andrew, that's what's going to be said if 0:17:05.480 --> 0:17:07.439 we get a labor government, and it's a labor government 0:17:07.480 --> 0:17:10.560 that says it puts impact on the environment front and 0:17:10.600 --> 0:17:12.520 center and they made a great deal of this in 0:17:13.040 --> 0:17:17.040 their in their perspectives so far. It will be interesting 0:17:17.080 --> 0:17:20.000 to see in reality what that means, how much you're 0:17:20.040 --> 0:17:22.320 actually going to get, you know, rather than an assertion, 0:17:22.960 --> 0:17:25.040 don't worry, we checked ninety five percent of our supplies 0:17:25.040 --> 0:17:26.840 and we kick the ones out that we didn't like. 0:17:26.920 --> 0:17:28.720 They're actually gonna have to demonstrate that. They're going to 0:17:28.760 --> 0:17:30.720 have to demonstrate that they've carbon mapped every bit of 0:17:30.720 --> 0:17:33.359 their business. They're gonna have to demonstrate Alva's point in 0:17:33.440 --> 0:17:36.600 numbers rather than in assertions that actually, because they don't 0:17:36.640 --> 0:17:38.760 waste so much, they're lower carbon in that way. You know, 0:17:38.800 --> 0:17:42.120 these do sound like, you know, benign practices, but they'll 0:17:42.160 --> 0:17:44.239 have to show that rather than assert it, and that 0:17:44.600 --> 0:17:48.960 will be such an interesting, you know test in detail 0:17:49.080 --> 0:17:52.440 of the Labor government's commitment to the environment and climate. 0:17:53.440 --> 0:17:56.800 But if for ethical reasons, Labor says no, do they 0:17:56.800 --> 0:17:59.320 have enough support from the business community to be able 0:17:59.359 --> 0:18:01.399 to still show that they're business friendly and able to 0:18:01.400 --> 0:18:02.800 attract capital to the UK. 0:18:04.359 --> 0:18:06.520 Oh it's hard to know. I mean, I get the 0:18:06.560 --> 0:18:11.040 impression that business leaders are quite impressed by Rachel Reeves 0:18:11.480 --> 0:18:13.919 and here Starmer, she's done a lot of work to 0:18:14.359 --> 0:18:16.679 you know, have lots and lots of business breakfasts around 0:18:16.680 --> 0:18:19.680 here in the city for the past few years. Jonathan 0:18:19.720 --> 0:18:22.600 Reynolds as well, the Shadow Business Secretary, the person who 0:18:22.600 --> 0:18:25.239 has been meeting with she, and he's done a lot 0:18:25.280 --> 0:18:27.200 of work on that. But I get the impression from 0:18:27.200 --> 0:18:29.720 speaking to colleagues who speak to business leaders all the 0:18:29.760 --> 0:18:33.800 time that they're less sure about Angela Rayner that we 0:18:33.800 --> 0:18:35.800 were talking about vibes that she has a different vibe 0:18:35.840 --> 0:18:40.080 in terms of her relationship for image towards business. And 0:18:40.560 --> 0:18:43.199 she's the person, of course, the sort of figurehead of 0:18:43.280 --> 0:18:46.560 their workers' rights reforms, and so I think that it 0:18:46.560 --> 0:18:49.400 will be interesting. This is just one example of where 0:18:49.400 --> 0:18:52.040 all these tensions that we said workers writes the environment 0:18:52.080 --> 0:18:54.639 but then being pro business I think might come to 0:18:54.720 --> 0:18:57.520 a head in government. We've seen it on that so 0:18:57.640 --> 0:19:01.080 called new deal for working people their work rights reforms. 0:19:01.280 --> 0:19:03.320 Different people in the shadow cabinet take a different view 0:19:03.359 --> 0:19:05.760 on that. Some people have been pushing for that business consultation, 0:19:05.880 --> 0:19:08.320 other people don't want it. I don't think she and 0:19:08.520 --> 0:19:11.760 has been discussed by everyone in the shadow cabinet. We 0:19:11.800 --> 0:19:14.879 haven't necessarily seen Ed Milliband and Angela Rayn away in 0:19:14.920 --> 0:19:17.560 with a view. Yet that could happen in government. 0:19:18.160 --> 0:19:23.119 So you know, given our understanding of how this Labor 0:19:23.119 --> 0:19:26.160 Party works, who would make the ultimate decision on whether 0:19:26.240 --> 0:19:27.240 the IP goes ahead. 0:19:28.320 --> 0:19:30.879 Well, interestingly, it would be I mean it should be 0:19:30.920 --> 0:19:34.440 Ker Starmer, and he's unpredictable in this way. I mean, 0:19:34.480 --> 0:19:37.480 on a lot, you would expect the pro business side 0:19:37.520 --> 0:19:40.199 to win, so that'd be Rachel Reeves, Jonathan Reynolds. They 0:19:40.200 --> 0:19:42.760 should win out but they but they aren't winning on everything. 0:19:43.480 --> 0:19:46.520 On things like workers' rights. Angela Rayner has been winning 0:19:47.040 --> 0:19:49.760 those on those arguments. We've seen it in recent weeks, 0:19:49.760 --> 0:19:52.360 so I don't think it's as clear cut. And that's actually, 0:19:52.440 --> 0:19:54.639 you know, the bigger fascination. If we do get a 0:19:54.720 --> 0:19:58.600 labor government, Ker Starmer will call the shots, and we 0:19:58.640 --> 0:20:00.679 don't know exactly what to expect from him. You know, 0:20:00.800 --> 0:20:02.679 sometimes we think we know and then he sides with 0:20:02.760 --> 0:20:04.440 other people and his party doesn't. 0:20:04.480 --> 0:20:07.880 It also depend on where they're at in the cycle 0:20:07.960 --> 0:20:09.720 and what they've just been beaten up for. I mean, 0:20:09.720 --> 0:20:11.840 if I think about when they ditch the twenty eight 0:20:11.880 --> 0:20:16.000 billion climate pledge for low carbon tech that they would 0:20:16.040 --> 0:20:18.479 invest twenty eight billion, and then quite soon after they 0:20:18.480 --> 0:20:21.880 were being quite protective of the workers' rights program because 0:20:21.880 --> 0:20:24.399 I think you're trying to kind of plicate different parts 0:20:24.440 --> 0:20:26.640 of the party at any given time, aren't you. Yeah. 0:20:26.640 --> 0:20:28.679 And also I think it depends on whether it's actually 0:20:28.760 --> 0:20:31.960 about money or not, Like they are quite clear, like 0:20:32.000 --> 0:20:35.119 to the twenty eight billion if they want no uncosted, 0:20:35.359 --> 0:20:37.720 manifested commitments, and they feel like they've have to ditch that, 0:20:38.000 --> 0:20:40.960 But on other things where the money is not so involved, 0:20:40.960 --> 0:20:42.800 they feel like they can be more radical, and that's 0:20:42.800 --> 0:20:44.440 where Kirstarmer tends to come down. 0:20:44.680 --> 0:20:47.720 So what kind of timeline are we looking at for Sheen? 0:20:47.760 --> 0:20:50.399 What happens We're looking post election, We're looking at what 0:20:50.440 --> 0:20:53.640