The Nike Corporate Responsibility Report was released last week and it is a "must read!" Once again, Nike is breaking ground not only in reporting on their program but also providing transparency into their operations and strategic aims. Notably, and what all the media outlets are focusing on, is Nike’s commitment to eliminate excessive overtime in their contract facilities by 2011. They propose an ingenious route to achieve this goal, (which I will be discussing in my monthly column in Ethical Corp magazine.) Suffice it to say they are working on getting the beam out of their own eye first.
The whole report is extremely interesting and enlightening for those who want to understand more about addressing complex issues in the supply chain. I want to encourage you to read the report by throwing out three highlights from its pages:
1. Nike has been working on business integration in a big way. "Corporate responsibility is no longer a staff function at Nike. It’s a design function, a sourcing function, a consumer experience function, part of how we operate." This is déjà vu for me! I’ve been reading up on Marks and Spencer’s Plan A ("because there is no Plan B") program and the similarities are poignant. Both companies are making CR the way they do business, not just a program that works in isolation from the rest of the operation. Not only does it make sense to approach CR from a holistic viewpoint, but it helps ensure the success of the CR efforts by bringing the whole company into the game plan.
2. Nike views their environmental footprint as a key focus of their CR program. "An environmentally friendly product made under poor labor conditions is a hollow success. A product made under good conditions but that is bad for our planet is a missed opportunity. We don’t believe in tradeoffs."
3. Nike is looking at root cause and permanent systemic change in labor conditions in 130 key contract factories. "While monitoring continues to be a cornerstone of our approach, we are taking a broader, more holistic look at our supply chain, focusing on root cause identification and solutions that will drive systemic change." This approach will ensure more resources and training are delivered to the 20% of their suppliers that "account for 80% of long-term, strategic impact to Nike."
What else is Nike doing? Aside from the overtime commitment, they are working to implement human resource management systems in their factories, which includes delivering freedom of association training to contract factories. Nike plans to partner with other brands to jointly monitor up to 30% of their supply chain by 2011. They also plan to roll out lean manufacturing to all contract factories in an effort to raise wages.
For those who are unsure about what all of this means for the industry, let me summarize: Nike has officially raised the bar on what brands and retailers can and should do to ensure their goods are made in a way that positively impacts the lives of workers, communities, and the environment.
