French Victor De Le Rue in action during the final TTR Snowboard Crans-Montana Champs Open Rip Curl in Crans-Montana, Swiss Alps © Press Association Images
French Victor De Le Rue in action during the final TTR Snowboard Crans-Montana Champs Open Rip Curl in Crans-Montana, Swiss Alps © Press Association Images

Rip Curl blames supplier for North Korea 'screw up'

Adam Leach is a freelance business journalist
22 March 2016

The Australian surf and snow-wear brand Rip Curl has ended its relationship with a supplier that subcontracted production of ski jackets to North Korea.

The company has also committed to increasing its oversight of its supply chain by carrying out more inspections and audits at its supplier factories.

An investigation by Fairfax Media revealed that ski jackets labelled as 'made in China' and sold by the brand had in fact been produced at a factory in Pyongang in North Korea. Repeatedly cited for its abuse of human rights and unfair working conditions, the news that products were being produced in North Korea has led to strong criticism of the company.

Rip Curl confirmed it was removing the remaining stock of the seven styles of mountainwear to be destroyed or donated to charity. In addition, it said the profit already made on sales of the products would be donated to charity.

The company said in a statement: “So why didn’t we do all of the above earlier? We trusted our supplier and they did not tell us the truth. We should have acted earlier and more aggressively at the time. The extent of the issue was wider than we had been led to believe.”

Rip Curl chief financial officer Tony Roberts blamed the supplier and stated the company became aware too late to take action. 

“We only became aware of [the issue] after the production was complete and had been shipped to our retail customers,” said Roberts. “This was a case of a supplier diverting part of their production order to an unauthorised subcontractor, with the production done from an unauthorised factory, in an unauthorised country, without our knowledge or consent, in clear breach of our supplier terms and policies.”

The company added: “This sort of screw up is our responsibility to prevent and we are doing everything in our power to make sure it does not happen again. We don't like the abuse of people in their jobs in any country either and apologise wholeheartedly for letting this happen in the first place.

Helen Szoke, chief executive of Oxfam Australia, called on the company to publish its procurement policies and supplier list.

Rip Curl needs to show the Australian public it is serious about preventing this from happening again through a dramatic overhaul of its checks and balances. It should start by publishing its policies and a list of the factories where its products are made," she said.

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