Adidas said on Wednesday that two employees had left the company as the German sportswear giant investigates bribery allegations in China.
The investigation was sparked by an anonymous letter sent to Adidas on June 7, allegedly written by staff in China, outlining “potential leadership issues” and allegations of “compliance violations.”
“Evidence has been found that one employee violated the company’s code of conduct while interacting with local merchants,” Adidas said in a statement.
“Separately, a second employee failed to meet the company’s leadership expectations of demonstrating mutual respect and trust. As a result, both employees have left the company.”
Adidas added that the investigation into the allegations was ongoing, with the assistance of independent external advisors.
According to the Financial Times, those accused in the letter included one of the company’s executives involved in Adidas’ marketing budget in China, which it said amounted to 250 million euros ($268 million) a year.
Another Adidas China manager is said to have received “millions in cash from suppliers and physical goods such as real estate”, according to the newspaper.
China is a key market for Adidas, but its operations in the world’s second-largest economy were hit hard during prolonged lockdowns due to the coronavirus.
However, the group’s sales in Greater China had recovered, growing eight percent last year, and Adidas predicts double-digit growth by 2024.
But the corruption allegations “could jeopardize the goal of finally regaining a foothold in (China) after the massive slumps of the past four years,” Juergen Molnar, an analyst at RoboMarkets, said last week.
jpl-mfp/sr/lth
