Adidas is investigating allegations of embezzlement and kickbacks in China

Adidas is conducting an investigation into compliance violations in China, a significant market for the brand. Whistleblowers, claiming to be Adidas China employees, alleged embezzlement and kickbacks by local executives in an anonymous letter. Complaints include nepotism, workplace bullying, and misuse of the company’s marketing budget. The whistleblowers threatened to involve the media and law enforcement if the allegations are not addressed. Adidas shares fell following the news. Greater China contributes 15% of Adidas’ sales, and the brand has faced challenges in the region due to competition from local rivals and controversies surrounding Xinjiang cotton.