In a concerning development, sportswear giant Adidas has launched an internal investigation into allegations of large-scale bribery and embezzlement within its China operations following a whistleblower complaint, the Financial Times reported.
The anonymous letter, allegedly written by “employees of Adidas China”, has named several Chinese Adidas employees, including a senior manager involved with the company’s marketing budget in the country, which is said to amount to a staggering 250 million euros ($267.5 million) annually.
According to the FT’s report, the letter claims that Adidas staff have been receiving kickbacks from external service providers commissioned by the company. These alleged kickbacks include “millions in cash from suppliers and physical items such as real estate.”
When contacted, Adidas media officials at the company’s headquarters in Germany did not immediately respond to requests for comment on the report, which emerged outside regular business hours.
The revelations come when Adidas has been reporting strong performance in China, with the company’s first-quarter sales in the country growing by 8%, as per its earlier financial disclosures.
This latest development underscores the need for robust corporate governance and oversight, especially in high-growth markets where the temptation for unethical practices may be more prevalent. The Adidas investigation will be closely watched, as the company seeks to swiftly address the concerning allegations and restore confidence in its operations in the crucial Chinese market.
