When Made in Italy Isn’t Enough for Armani, Loro Piana, even Shein

The prestige of "Made in Italy" has long stood for exceptional craftsmanship and heritage. Yet recent regulatory actions reveal a profound shift: the iconic label now equally demands transparency and traceability.

Italy’s antitrust regulator, AGCM, recently fined Giorgio Armani S.p.A. and its subsidiary GA Operations €3.5 million for misleading ethical claims. Investigations uncovered severe labour violations in Armani’s outsourced leather workshops, including unsafe machinery, unsanitary conditions, and undocumented workers lacking fundamental protections. Armani, maintaining its commitment to transparency, plans to appeal these findings.

In a related yet distinctly different action, Loro Piana, part of the LVMH group, faced judicial administration imposed by a Milan court due to significant labour abuses within its cashmere production supply chain. Workers, predominantly undocumented immigrants, were exposed to hazardous conditions and excessively long hours.

Although not criminally charged, the judicial measure against Loro Piana signals critical systemic oversight failures and emphasises regulatory intolerance toward ethical negligence.

These luxury brands aren’t alone. The fast-fashion giant Shein also faced AGCM penalties, receiving a €1.8 million fine for similarly misleading eco-claims. The inclusion of Shein underscores a pivotal regulatory expansion: no longer limited to mass-market fashion, scrutiny is now penetrating luxury segments historically shielded by prestige.

The juxtaposition of Armani and Loro Piana against Shein highlights a decisive message from Italian regulators that traceability and supply chain transparency are becoming core to brand equity, not merely compliance mandates. Luxury brands’ vulnerability to regulatory scrutiny now matches that of fast fashion, reshaping the competitive dynamics of the entire fashion industry.

For luxury labels, the implications extend beyond immediate fines or legal oversight. Transparency failures fundamentally threaten long-term brand equity, eroding consumer trust and diminishing market resilience. Ethical lapses compromise brand narratives, transforming once-cherished heritage stories into cautionary tales. Brands should now recognise transparency as integral to their value proposition, directly affecting financial performance, stakeholder relations, and consumer loyalty.

"Made in Italy" today signals more than heritage—it mandates authenticity, transparency, and uncompromising accountability. The future of luxury branding depends as much on traceable ethics as on timeless craftsmanship.