Nike


 

Nike: Company Profile

Nike is the world's number 1 maker of athletic footwear and clothing. After a concerted campaign in the 1990's regarding working conditions in supplier factories, the company was said to have turned over a new leaf.
 
But just how successful was that campaign in the long term and what of Nike's ethical record in other areas such as the environment?
 

Last updated: October 2015

Annual Revenue$20.86 billion a year

 

Other BrandsCole Haan, Converse, Hurley and Umbro.

 

Company Score6 out of 20

 

BoycottsYes from Forcechange.com

Ethical Consumer Best Buy?No

 

Ethical issues by category

The Nike corporate responsibility report contains a comprehensive strategy for monitoring conditions and applying corrective action at supplier factories and they address a number of difficult issues including home working, temporary contracts and apprenticeships. The company therefore attains our best rating for supply chain management.

However an article published on the Institute for Global Labour and Human Rights (IGLHR) website in April 2015 slammed Nike for its sourcing in Vietnam.

The article states that, " Nike’s presence in Vietnam led to a continuation of wages as low as 27 cents an hour in 2012, with a slight increase to 48 to 69 cents an hour in January 2015, which is well below subsistence levels... For years, Nike has been exploiting the 330,000 Vietnamese workers, mostly young women, who are poorly paid and denied their most fundamental rights," 

In addition the company listed subsidiaries in China, India, Israel, Philippines, Russia, Thailand and Vietnam. The company's manufacturing was carried out in Sri Lanka, Bangladesh and Pakistan. All these countries are on Ethical Consumer's list of oppressive regimes. 

In 2015 Nike received a worst rating in Ethical Consumer's environmental reporting category.

Ethical Consumer viewed the Nike Corporate Responsibility report online at www.nikeresponsibility.com in May 2015.

The report discussed energy and climate, toxics, water use and waste. However, it was not considered to demonstrate a reasonable understanding of the company's main impacts, as no mention was made of agriculture or the sourcing of raw materials. 

The report contained some dated and quantified targets to reduce impacts across these four areas. However, only the toxics target went beyond 2015: "Achieve zero discharge of hazardous* chemicals for all products across all pathways in our supply chain by 2020."

The report stated that the company was considering independent assurance of its reports, but as yet was using internal audits.

In 2009 Nike established an Amazon leather policy, in which it made the commitment not to use leather produced in the Amazon due to the fact it contributes heavily to tropical deforestation. It required all suppliers to certify in writing that they complied with this policy. 

It added that "leather suppliers must screen tanning processes against the Leather Working Group (LWG) Protocol to ensure adherence to best environmental practices."  LWG measured the environmental impacts of tanneries and encouraged them to reduce the environmental impacts of their own and suppliers’ operations. 

 

However as a supplier of animal products it received a negative mark in the Ethical Consumer animal welfare category. It is under a boycott call for its use of kangaroo leather in football boots.

In 2015 Nike had a company structure which included several subsidiaries considered likely to be used for tax avoidance strategies and received Ethical Consumer's worst rating in this category.

In May 2015 Ethical Consumer viewed Nike's 10-k Securities Exchange Commission filing Exhibit 21 which listed the companies subsidiaries. The company listed subsidiaries which at the time of writing Ethical Consumer considered to be located in tax havens. 

According to its SEC filing Nike had two holding companies in Hong Kong, three in Delaware and one finance company in Bermuda. The company also had a number of other subsidiaries in the countries listed above plus more in Singapore and Switzerland.

In-Depth Information

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