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www.nikebiz.com and www.nikeresponsibility.com

Headquarters:  Beaverton 
Country:  United States
Founded in:  1968
Total points of sale in Europe:  Nike products are sold through NIKE-owned retail stores, and through a  mix of independent distributors and licensees  in over 160 countries around the world.
Owned by: Public shareholder company
Name of CEO: Mark Parker, President and CEO
Product description: Apart from athletic footwear, sports apparel and accessories under the brand name Nike, Nike sells a line of dress and casual footwear, apparel and accessories for men and women under the brand names Cole Haan, G Series and Bragano; athletic and casual footwear, apparel and accessories under the Converse, Chuck Taylor, All Star, One Star and Jack Purcell trademarks; footwear under the Hurley trademark; and athletic footwear and apparel in retail channels under the “S” logo. In 2007 Nike also acquired the sportswear brand name company Umbro.
Countries of production: Egypt, Morocco, South Africa, Tunisia, Argentina, Brazil, Canada, Chile, Colombia, Ecuador, El Salvador, Guatemala, Honduras, Mexico, United States of America, Bangladesh, Cambodia, China, Hong Kong, India, Indonesia, Israel, Japan, Jordan, South Korea, Macau, Malaysia, Moldovia, Pakistan, Philippines, Singapore, Sri Lanka, Taiwan, Thailand, Turkey, Vietnam, Belgium, Bosnia and Herzegovina, Bulgaria, Greece, Italy, Lithuania, Portugal, Spain, United Kingdom, Australia, Fiji

Nike
One Bowerman Dr. OR 97005,
Beaverton, US

Comments CCC and proposals for action

Nike has taken steps towards greater transparency through releasing summary information regarding their company’s factory labour audits and releasing lists of suppliers of Nike branded goods. Over the last years, Nike has proven to be responsive when cases of labour rights violations in specific suppliers are bought to their attention by labour rights groups. The CCC looks forward to learn about the adaptations of Nike’s code of conduct, expected at the end of 2008, and calls upon Nike to include the right to living wage for a 48 hour working week.

However, there is still a need for improvements to make Nike’s supply chain, including their purchasing practices, fair for workers. The CCC calls upon Nike to implement a living wage for all workers producing its goods. Workers should be provided with confidential and accessible means to report exploitation and abuse; and trained by independent organizations concerning their rights at work. The current practice of relocating orders occurs often goes hand in hand with exiting unionized factories. The CCC therefore urges Nike to prioritize retaining unionized factories in the companies’ supply chain, and to not increase its sourcing in countries and free trade zones where the right to freedom of association does not have legal force. If factories close, Nike should ensure that workers can transparently negotiate their severance pay, and won’t suffer from a set-back in their employment status when applying for new jobs. To guarantee that all workers are entitled to the full package of labour rights, Nike should ban, or severely restrict, the use of short-term contracts. Finally the CCC expects Nike to make sure its purchasing practices allow suppliers to respect labour standards, which includes stable business relationships, and reasonable prices and delivery times.

The following evaluation of the company’s performance in terms of transparency, code implementation and monitoring of labour standards is based on the company’s response to the questionnaire from the CCC and on an additional desk study conducted by the CCC in 2007. In the section “Recent developments” you can find additional information gathered after 2007.

Transparency

 Nike has responded to the CCC-questionnaire and has provided some additional documents. The company works with civil society on corporate accountability issues and is in regular dialogue with NGOs and/or trade unions, including the CCC. The company is highly transparent with regard to: turnover, profits, sales and corporate structure. The salary of the CEO is known. Some information is given about producer countries and the structure of the supply chain. Nike has publicly disclosed their factory list. A sustainability report is publicly available but it does not meet all the international reporting standards (GRI). Nike provides results of factory audits and information about verification activities. The company provides concrete benchmarks for future monitoring activities and for improving respect of labour rights in the facilities used.

Formal commitment to labour standards

Nike has adopted a code of conduct that requires compliance with all relevant local labour laws and indicates that where local and international standards are at variance the higher standard should prevail. The code does not include a reference to the Universal Declaration of Human Rights. The company is formally committed to respecting minimum labour standards in accordance with ILO Core Conventions. These include the right to organise and bargain collectively and prohibit child labour, discrimination, and forced labour.

Nike is a member of a MSI and its code of conduct does apply to all workplaces where its products are made. The code of conduct includes measures to implement the code and monitor labour conditions in the facilities used.  Beyond the ILO Core Conventions, the company is only committed to paying the legal minimum wage or industry standard, i.e. not a living wage. There are some limits to overtime. The company’s code calls for a safe and hygienic environment for the workers who produce its garments and/or sportswear. The company does not explicitly require that all workers receive a regular employment contract. 

Beyond the labour standards mentioned above, the company code is not precise enough on some specific issues. It does not explicitly refer to the ILO conventions on which its articles are based, neither does it state its commitment in relation to:
- special provisions for workers under 18 years of age (e.g. education, no night work); 
- specific steps to encourage decent working conditions in countries where freedom of association and collective bargaining are restricted by law; 
- guaranteeing a living wage during regular working hours without overtime.

Code implementation and purchasing practices

The company is a member of a credible multi-stakeholder initiative (MSI). Nike implements the code according to the MSI’s principles of implementation and is committed to taking credible steps to improve labour conditions. Nike pays for the monitoring of suppliers. The code of conduct is translated into most of the languages of the countries the company is sourcing from.  Nike declares that it trains factory management on most labour rights issues, but that training on labour rights issues for the workers is left to factory management. According to the information given Nike has no intention to implement the payment of living wages to workers.  Nike takes, to some extent, the impact of its own purchasing practices into account. It has established some procedures which show how to improve planning and prevent excessive overtime.

Monitoring and Verification

The company is involved in the multi-stakeholder approach coordinated by Fair Labor Association (FLA).  The monitoring and/or verification process includes consultation of local stakeholders.

Violations of labour rights and public conflicts

Nike has been involved in several Urgent Appeal cases. One of them was the unionized Dominican BJ&B factory, producing caps for Nike and adidas, which announced its sudden closure without securing a severance package for the workers involved. The key violations were, among other issues, related to freedom of association and the right for collective bargaining. The company reacted positively to the CCC with respect to the violations, but only after a campaign. Full legal severance was paid and after negotiations between the union and the factory, an additional 3 months wage were paid to the workers and a donation was made to the union. There are no outstanding issues.

Nike was also a buyer in the Hermosa case, a Salvadorian factory that closed its doors after a union was formed, and left the workers with unpaid wages, unpaid social security premiums and pension funds.  The key violations happened in the field of freedom of association and the right for collective bargaining. After being informed about the violation, the company reacted to the CCC as follows: Nike has taken some steps to address the severance and back pay issues, in cooperation with adidas, Russel Athletic and the FLA. However, it took a while before a compensation fund was set up by the FLA. To date the initial amount donated to the fund is too small to cover the outstanding amounts to the workers. All brands, including Nike, are requested to increase their contribution and admit their share in the responsibility for the workers' current situation. Lingering concerns remain that the failure of 64 workers to find employment is related to blacklisting practices.

Paxar, a Turkish supplier who produces labels for many brand name companies including Nike, bashed the newly formed union Teksif by dismissing union members, harassing union members and refusing to recognize the union.  The key violations happened in the field of freedom of association and the right for collective bargaining.  The company reacted positively to the CCC or the reporting organisation but only after a campaign.  The violations have been corrected and there are no outstanding issues.

Recent developments

In 2008 Nike released a report on their activities in China in the light of their overall CSR policy. In this report Nike calls on governments to “recognize and respect the principles embodied in ILO Conventions 87 and 98 regarding freedom of association and collective bargaining.”  In addition, Nike announces a revised version of their Code of Conduct for the end of 2008, in which their approach to industrial relations (freedom of association) is revisited.

At the Star factory in Honduras, 55 union members were dismissed shortly after registering their union in November 2007. Worker protests, an international solidarity campaign, and the intervention of Nike, one of the brand buyers, was successful in redressing the violation of the fundamental right to organize. On December 10, an agreement to reinstate the workers and to engage in constructive dialogue to resolve outstanding issues was signed by representatives of the US-based owner, the workers, the Unitary Federation of Honduran Workers (FUTH), and the Unitary Confederation of Honduran Workers (CUTH).

Nike announced to the CCC that it would revise its code of conduct for suppliers at the end of 2008. This includes formal reference to ILO conventions and the Universal Declaration for Human Rights, taking steps to encourage decent working conditions in countries where freedom of association and collective bargaining are restricted by law, and the requirement of the provision of formal employment contracts.

At a three day conference in July 2008, organised by the Play Fair 2008 Campaign (led by the International Trade Union Confederation, the International Textile, Garment and Leather Workers Federation and the Clean Clothes Campaign), Nike committed to forming a joint working group with other sports brands, trade unions and NGOs to explore amongst other issues how to promote trade unionism and collective bargaining as well as improving wages across the sector.

In July 2008 an Australian Channel 7 news program uncovered forced labour and appalling living conditions of Bangladeshi, Vietnamese and Burmese migrants in a Nike supplier factory in Malaysia. In response through a press statement Nike announced that it guaranteed that all workers would be given the choice to return home or stay and would be paid all employment fees. The fees would include but not be limited to the large recruiting fees paid to agents in the workers home country and worker permit fees. Workers would also be moved to suitable apartments, and would have immediate and total free access to their passports without any restrictions.