NEW YORK — Labor leaders on Wednesday called on other multinational brands to follow Nike’s lead by detailing their factories and procedures for monitoring them.
Nike issued a report Wednesday outlining its procedures as well as the names and locations of more than 700 factories it works with around the world. The International Textile, Garment & Leather Worker’s Federation lauded the global athletic giant on its decision to voluntarily disclose its suppliers.
“Consumers have a right to know where their clothing is made and under what conditions,” said Neil Kearney, general secretary of the Brussels-based ITGLWF, who was also part of the report’s review committee. “The current system of sporadic social auditing across a hidden supply chain is no longer sustainable in the medium and long term.”
Eric Dirnbach, apparel industry coordinator for UNITE, called the report “a positive first step.”
“Nike has come under criticism for so long that they had to do something substantive, although we feel this should have been done years ago,” he said. “We regard almost everything Nike has done until now as slick public relations, and if this is the beginning of change, then that is a good thing.”
Nike is looking to begin a process of getting companies to work more closely together to create better working conditions and common standards.
Hannah Jones, Nike’s vice president of corporate responsibility, said, “We hope that full disclosure, if also followed by other companies, will lead to more sharing of industry monitoring and resources for factory monitoring and remediation, where legal. The current system has to evolve fundamentally to create broad, sustainable change for factory workers….No one company can solve these issues that are endemic to our industry.”
This is the second corporate responsibility report Nike has released, and its first since 2001.
Nike’s list of factories doesn’t detail what each factory produces, but it states names and addresses and offers insight into where the company’s merchandise is made. Nike is sourcing all over the world, with its largest number of contract factories based in China, Thailand, the U.S., Vietnam, South Korea and India.
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“We have been asking for this list for seven years,” said Medea Benjamin, director of Global Exchange in San Francisco. “We think it is a positive development, but we think there are still so many issues, like workers’ [rights] to organize, that are critical that still needs to be resolved.”
“Many sweatshops are hidden away, and now that there is a list, other organizations can go in and see if Nike is being truthful about what is going on,” Dirnbach said. “Also, Nike is an industry leader. So now that they have revealed this information, it’s likely other companies will, also.”
Nike, which had sales of $12.2 billion in 2004, faced heated criticism in the early and mid-Nineties, along with other apparel vendors and retailers, for issues related to underpaid workers, human rights violations and mistreatment of employees in some foreign contract factories. Many of these companies, which source most of their products from plants largely run by independent owners, turned to codes of conduct that they developed by third-party monitors, such as Social Accountability International, to crack down on abuses.
In the report, Nike details the evolution of its monitoring procedures and some of the challenges workers at its factories face in areas such as overtime and free association. Gap Inc. issued a similar report last year.
“We’ve evolved from outsourcing labor monitoring to relying on a trained team of internal monitors and support for common monitoring platforms such as the Fair Labor Association,” the report states. “These changes are driven by awareness that structural issues endemic to the global footwear apparel and equipment industries affect an individual company’s ability to change conditions in any particular factory.”
For advice in preparing the report, Nike consulted with experts from trade unions and nongovernmental organizations, as well as leaders from the business, academic and investor communities, who served on a report review committee. Other organizations, including the Center for Energy and Climate Solutions and the Center for Disease Control and Prevention, also provided independent assessments. The report details results from 569 factory audits from Nike, and 50 from the FLA.
Included in the report is a letter from Nike co-founder Phil Knight in which he writes: “Over the past decade, I’ve seen a number of chapters written on the quest to improve working conditions in the apparel and footwear industry….The second chapter began with critics bringing working conditions in underdeveloped countries to the attention of the world. After a bumpy original response, an error for which yours truly was responsible, we focused on making working conditions better and showing that to the world.”
Knight writes that Nike’s new chief executive officer, William Perez, was chosen in part for his track record in corporate responsibility.
The report states that virtually all Nike brand products are manufactured by independent contract factories. In 2004, the company placed orders in 122 new factories and discontinued orders at 34 factories, and 43 percent of the factories that entered Nike’s seven-step New Source Approval Process did not pass.
The report gives detailed information on the methodology of Nike’s three levels of monitoring, including its M (management) Audit, the internal system it established in 2003 that has become its primary tool for understanding and dealing with working conditions.