CSR Analysis and Impact on Operations
Nike has a Code of Business Conduct and Ethics that includes its commitment to the environment and is a signatory of the UN Global Compact. Nike has created a team of sustainability managers led by an independent director. Its environmental goals include producing 'eco-friendly' products and minimizing its environmental impact through the reduction of greenhouse gases, organic solvents and PVCs.
Nike acknowledges the difficulty of tracking environmental emissions and the use of materials in supply factories, and is currently exploring new ways to best respond to these difficulties and enforce environmental compliance. All major material suppliers are audited with a focus on reducing chemicals. Facility initiatives include recycling and energy efficiency, reducing water usage and monitoring corporate travel. In 2005, Nike began collecting baseline data on more than 650 contract factories in 52 countries, conducting 65 audits, and 15 in-depth root cause assessments. The results told showed that the greatest Environmental, Safety and Health (ESH) issues are in specific factory types (footwear, vertical apparel and inflatable facilities which make products such as basketballs, volleyballs and soccer balls) and the majority of those contract factories are in 10 countries: Bangladesh, Brazil, China, Honduras, India, Indonesia, Mexico, Thailand, Turkey and Vietnam. Nike then used factory type and country filters to focus its ESH efforts on about 70 contract factories that employ about half of the contract factory workers around the world. Chemical exposure, worker protection, fire safety, and maintenance related safety are the most significant ESH issues in contract factories. To that end, the company is working to improve worker health in contract factories through auditing and analysis, training and factory capacity building, integrating factory management systems, and reducing solvents. Additionally, with increasing pressure on the company to reduce its greenhouse gas emissions, the company is looking to offset emissions from the extensive amount of business travel undertaken. New products are also being developed that are more eco-friendly. For instance, the company has begun to offer an organics line, and is integrating small amounts of organic cotton into all apparel items, with a target of at least 5% organic cotton in every piece of cotton apparel by 2110.
Nike's life cycle analysis program is designed to phase out the use of materials and chemicals that are harmful to human and/or environmental systems. Products such as the Dri-FIT Stand-Off Singlet, SD 400 Slide Sandal, and the Air Essential III incorporate both environmental sustainability and marketability. Nike is also developing a cleaner, less chemically-dependent rubber for eventual use on all athletic shoes. Another unique product in Nike's recycling program is entitled 'Nike Grind'. Through this program Nike recycles used shoes to use in the fabrication of synthetic playing fields (football and soccer fields, basketball courts, running tracks, tennis courts, and playground padding). To date the program has been able to provide over 80 surfaces around the world, many of which are located in under-served communities. The program has been extended to include non-Nike branded athletic shoes. Nike has managed to eliminate 96% of the identified chemicals by weight in one particular type of rubber used in the shoe production process. The company is also looking for ways to increase the amount of rubber it recycles. At the close of FY06, Nike had more than 50 percent of footwear models containing some of the improved more sustainable rubber. Across the Nike brand, this change has allowed for the elimination of at least 3,000 metric tons of toxic materials every year. Nike discloses that an estimated 20 gallons of water are used for every pound of textile produced. Use of this water and its discharge is the largest...
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