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Adidas is investigating allegations that some of its employees in China took kickbacks from suppliers.
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A letter from those claiming to be “employees of Adidas China” accuses senior executives of embezzling “millions of euros,” according to a Financial times report.
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This is what the sneaker and sportswear maker says Investopedia that it investigates the case together with external experts.
Adidas is investigating possible compliance violations by its employees in China following a whistleblower complaint accusing high-level executives of receiving millions of euros in bribes.
The German sneaker giant said in a statement to Investopedia that it takes allegations of potential compliance violations “very seriously” and is “clearly committed to complying with legal and internal regulations and ethical standards in all markets where we operate.”
The company added that it received an anonymous letter on June 7 and is “currently intensively investigating this matter with external legal counsel.”
The story was first reported in the Financial times on Sunday. It said the letter initially appeared briefly on a Chinese social media site earlier this month, allegedly written by “employees of Adidas China.” The post named several employees in China who allegedly took kickbacks, including a senior manager accused of receiving “millions in cash from suppliers and physical assets such as real estate.”
Adidas has been struggling in China since the outbreak of COVID-19
The company’s operations in China have struggled since 2020, when the COVID-19 outbreak led to extended lockdowns that dried up sales. Furthermore, Adidas – together with other Western companies including Nike (NKE) – faced backlash from Chinese consumers after pledging not to buy cotton from China’s Xinjiang region in 2021 over allegations that Beijing used forced labor there.
Adidas shares fell 3.3% in German trading at 10:30 a.m. ET on Monday.
Read the original article on Investopedia.
