ColumnNike has proven that it can “just do it” when it comes to incorporating sustainability into its supply chain… or has it?
Not so long ago, the Nike brand was synonymous with sweatshops and child labor.
But over the past decade, it has successfully reinvented itself into a poster child for innovation and sustainability in the apparel industry. Under its Nike Better World campaign, it has launched game-changing initiatives like doubling its use of recycled polyester in apparel; starting the Reuse-A-Shoe program, which has turned 28 million old shoes into things like sport courts, tracks, and playgrounds; and creating the Nike Materials Index, which seeks to clarify the environmental impact of internal design decisions. And ostensibly, it has cleaned up its labor issues.
For many, it’s a rags-to-riches story – proof that it is possible for one of the largest shoe companies in the world to embrace social responsibility and still turn a hefty profit. If they can “just do it,” why can’t the rest?
The story, however, is slightly more complicated. This week’s return of Behind The Label looks at the good – nay, great – elements of Nike’s about-face, along with the not-so-good aspects.
Nike’s corporate social responsibility efforts have been lauded throughout the industry. However, the company makes clear that it’s less altruism that drives forward their sustainability efforts – it’s the need to prepare for a “fundamentally different operating environment,” one in which “competition for scarce natural resources affects the cost and availability of the inputs needed to make our products” and “rising energy costs and greenhouse gas emissions lead to increasing pressure on traditional models of product manufacturing and transportation.”
Its sustainability pillars are four-fold:
- Creating a portfolio of sustainable materials
- Prototyping and scaling sustainable sourcing and manufacturing models
- Igniting and driving market transformation
- Creating digital services revenue
Now, it’s easy for companies as large as Nike to talk the talk when it comes to sustainability goals. But Nike is also walking the walk, particularly when it comes to the technology of sustainability.
Its latest innovation is called Flyknit – a new shoe created through a mechanized knitting process that minimizes weight (for a better “barefoot” running experience AND lower shipping costs) as well as waste (66 percent less than the brand’s popular Air Pegasus+ 28).
The computer-controlled weaving technology is a “game-changer,” Nike president Charlie Denson told Bloomberg News last March. The technology eliminates the need to cut and assemble multiple parts of the shoe, which is the most labor-intensive part of the process and a large reason Nike has long outsourced cheaper labor in Asia. Denson says that the technology cuts costs so much “that eventually we could make these shoes anywhere in the world.” Including, potentially, on-site at your local Nike store.
Indeed, Nike has come a long way from its position at the center of the sweatshop movement of the 1990s, when it was revealed that the company was using child labor in its overseas factories. The news sparked student movements on college campuses across the country, which lobbied their administrations to divest themselves from campus and sports apparel that were made under sweatshop-like conditions.
Since then, Nike has made an effort to work with advocacy groups and unions to address their concerns. But apparently, the company hasn’t worked hard enough. For instance, in 2011, garment workers at the Sukabami plant near Jakarta, Indonesia, claimed that they were mentally and physically abused at factories making Converse, a brand that is owned by Nike. The workers reported that supervisors “slapped them in the face, kicked them and called them dogs and pigs,” according to a report from the Associated Press. Workers at the factory made around 50 cents an hour – “enough for food and bunkhouse-type lodging, but little else.”
According to the AP, Nike is aware of such abuses in its factories, but it is unable – or unwilling – to stop them. An internal report released in 2011 showed that about two-thirds of the 168 factories contracted by Nike to make Converse products fail to meet Nike’s standards, with twelve in the most serious category, 97 in a category for no progress, and six that hadn’t been audited.
When Nike released the Flyknit shoe, it also launched the Nike Flyknit Collective – a large-scale marketing campaign centered around a platform for creative innovators who were embracing the fundamental principles of the shoe’s design. As part of the campaign, Nike hosted large scale art installations in six major cities, producing video and media content to share on the web.
Nike is famous for lavish advertising, endorsement deals, and marketing stints like this one. The Flyknit campaign easily cost millions. And recently, Nike made headlines for closing one of the most lucrative athletic sponsorships in history — $200 million over 10 years to 23-year-old golf star Rory McIlroy.
When faced with such sums, it’s difficult to explain why Nike can’t pay its factory workers more than 50 cents an hour, or why it claims that it can’t scrounge up the resources to more vigorously monitor its overseas factories.
The advances taken by Nike have been tremendous. And it’s possible that Nike’s latest advance, a shoe knit mechanically, is its greatest yet.
But have Nike’s shiny sustainability efforts distracted us from the fact that substandard conditions continue to perpetuate its overseas factories? The campus protests may have stopped in the 1990s, but it appears the problems continue to exist more than 20 years later. Nike has proven that it has the resources to overcome sustainability barriers previously thought insurmountable. Let’s hope its next efforts are directed toward creating a better world for its workers.