Goal for Nike

23-09-2010 | Nike has been the target of NGO and media criticism for years. Perhaps thanks to this pressure, Nike now scores well enough to be included in the Triodos investment universe. Nike has some 30,000 employees of its own and has contracts with manufacturers that employ more than 800,000 workers. For many years, the company has been a favourite target for activists because of its questionable labour rights performance. Issues range across a broad spectrum such as wages, forced labour, severances, and child labour.

Transparency

In response to the criticism, Nike has improved its management programmes and reporting transparency. Three supply chain monitoring tools are now used to check compliance with Nike's Code Leadership Standards. During factory audits, two of these tools are used by Nike compliance officers to analyse causes and impacts of problems. The tools focus on issues such as work hours, wages and benefits, freedom of association, and grievance systems. They also include action plans to remediate non-compliances. In addition, Nike has developed a tool for its contract manufacturers to self-audit. Results of factory audits are made public and include rating results and trends. Case studies are also shared.  Triodos engaged with Nike about the scope of its Code of Conduct, to ensure that the labour issues it addresses relate as much to own employees as to suppliers. The company was very willing to engage with us. It shared that its Code of Conduct is available in all major workspaces in the employees' language and employees are trained on their rights. Nike contractors must also maintain documentation to show compliance with the Code and agree to unscheduled inspections.

General sustainability also on the up

In general Nike’s sustainability performance has also improved. For example, the company is increasing the use of organic cotton in its apparel and adding to its 100% certified organic product range. The global cotton market is dominated by genetically engineered cotton and this is one way to offset its considerable involvement in the industry. 

Conclusion: investment allowed

Nike is likely to remain a target of NGOs, especially for labour rights issues. But Triodos considers Nike’s management programmes for labour rights to be robust and to meet our strict standards. Our latest engagement activities with the company helped clarify this. As a result, Nike now qualifies for the Triodos sustainable investment universe.

Want to know more?

Triodos SRI Strategy
Selection process
List of eligible companies

Note: The issues explored in this article are specifically relevant for sustainable investments on the stock market. Triodos Bank believes that our socially responsible investments are a powerful means of promoting our values and working for greater sustainability, while enabling us to offer a complete range of attractive investment options to customers who choose to invest on the stock market.