As it prepares for a potential initial public offering (IPO) in London, global online fashion and lifestyle retailer Shein has announced a commitment to invest up to €250 million (US$272 million) in the UK and EU over the next five years.

Headquartered in Singapore, the Chinese company’s investment will include the creation of a circularity fund, along with operational and commercial investments aimed at further enhancing its circularity efforts and supporting the local entrepreneurial ecosystem in the UK and Europe.

The fast-fashion company, which has been widely criticized for promoting throwaway fashion, will be the cornerstone investor of the fund and is inviting businesses, financial institutions and sovereign wealth funds to co-invest in it.

The planned fund, for which Shein will provide the launch capitalization of €200 million, will build on its existing programmes to advance research and development (R&D) and innovation in circularity for the fashion industry.

The remaining €50 million of the initial €250 million commitment is earmarked for initiatives to support brands, designers and artisans across the UK and the EU to grow online businesses with Shein’s marketplace services, as well as potential investments in R&D.

The fund, the company says, will support start-ups and businesses throughout Europe and the UK that are developing next-generation technologies and solutions by investing in early-stage start-ups working on textile-to-textile recycled materials innovation and related areas.

With more mature start-ups with existing production capacity in textile-to-textile recycled materials or new and emerging preferred fibres, Shein plans to enter into offtake agreements or other commercial partnerships.

“As a global leader in our sector, Shein has both a responsibility and an opportunity to accelerate innovations that can address the environmental footprint of the fashion industry,” adds Donald Tang, the company’s executive chairman. “Given our scale and reach, we can become a catalyst for the widespread adoption of these solutions across the industry.”