Loro Piana Trust Rank

In July 2025, Loro Piana, the renowned Italian luxury brand owned by LVMH, was placed under judicial administration by the Milan Tribunal due to its failure to prevent labor exploitation (caporalato) within its supply chain. This development marks a significant reputational crisis for the brand, with wide-reaching implications for its standing in the luxury fashion sector.

Key Developments

Judicial Administration

• Judicial Measure:
  The Milan Tribunal imposed a one-year judicial administration on Loro Piana S.p.A., citing the company’s inability to prevent systematic labor exploitation among its suppliers, particularly in the production of high-end cashmere garments.

• Scope:
  Loro Piana is not accused of direct exploitation, but is held responsible for having “established stable relationships” with suppliers engaged in illegal labor practices, including the use of clandestine Chinese workshops with poor labor conditions12.

• Appointed Administrator:
  The court appointed Micaela Cecca as the judicial administrator, with the first hearing on the company’s remediation plan scheduled for November 13, 202513.

Nature of the Violations

• Supply Chain Issues:
  Investigations revealed a complex network of unauthorized subcontracts, extending through four levels, ultimately resulting in the employment of irregular and undocumented workers. These workers faced violations of health, safety, wage, and labor standards12.

• Economic Disparity:
  Luxury garments, such as cashmere jackets retailing for €1,000–€3,000, were produced for as little as €100 in these workshops, highlighting the stark contrast between retail prices and labor compensation12.

• Profit Maximization:
  The court found that Loro Piana’s cost-cutting measures indirectly facilitated the exploitation system, prioritizing profit over compliance with labor laws and ethical standards1.

Reputation Impact

Overall Reputation Score: 5.0 / 10

Summary & Outlook

• Brand at a Crossroads:
  Loro Piana’s reputation has suffered a major blow, transitioning from a symbol of luxury and craftsmanship to a case study in supply chain negligence and labor exploitation.

• Industry Context:
  This is the fifth major luxury brand in Italy to face such measures since 2024, indicating systemic issues in the sector12.

• Next Steps:
  The effectiveness of the judicial administration, remediation efforts, and public transparency will be critical for Loro Piana’s recovery and future reputation.

References:
1 Il Fatto Quotidiano – “Caporalato tra i fornitori”: Loro Piana in amministrazione giudiziaria
2 Corriere della Sera – Loro Piana spa in amministrazione giudiziaria
3 LaPresse – Loro Piana in amministrazione giudiziaria, sfruttamento in appalti