Group6 DivD Presentation Nike

8/20/2019 Group6 DivD Presentation Nike

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CORPORATE SOCIAL RESPONSIBILITY

OF

NIKE INC.

Presented by



Founded in 1964 as Blue Ribbon sportsRenamed as Nike Inc. In 1971

Named after Greek God of Victory Νίκη

Headquartered in Beaverton, Oregon

Largest athletic footwear and apparel manufacturer

One of the most visible brands in the worldRevenues of over $25 Billion

Profit of over $3 Billion

Close to 50,000 employees all over the world

Total valuation close to $70 Billion

rivia

Nike Logo – “swoosh” is one of there most popular alongwith the logos of Mercedes and Apple Inc.

NIKE Inc.



NIKE Inc.

Nike is the leading brand in theworld of sports. Their closestcompetitors are Adidas, Puma andReebok. Nike holds close to 1/3 ofthe global market share of Athletic

Footwear.Known for heavy promotionusing big stars.Sponsors the top athletes inall the popular sports.

Nike Inc. Has growth at a cumulative

average growth rate of 21 over the

last 10 years.



CSR

A corporate self-regulation integrated

into business modelAn in-built mechanism to ensurecompliance with spirit of law & ethicsA move to encourage positive impactthrough it activity on environment

The TBL is an accounting framework with three dimensions: social,environmental and financial. The TBL dimensions are also commonly called

the three Ps: people, planet and profit and are referred to as the "threepillars of sustainability".

Triple Bottom Line Approach to CSR

C•CORPORATE PHILANTHROPHY

S• RISK MANAGEMENT

R•CREATING SHARED VALUE



CSR



• Doing innovation through the lens ofsustainability is fundamental to achieving growththat is not dependent upon constrained resources

Vision

• Make better today – to improve its business andits value chain as they have environmental andsocial impacts that can be reduced through long-term commitment to continuous improvement

Mission

• Sustainable Innovation• Integrity of work process• Accountability

Values

NIKE + CSR



Low wages and poor working conditions in Indonesia. Labours paid 14 cents aday which is lower than the minimum wage for IndonesiaUsing children to stitch balls in sweatshops in Pakistan in poor conditions.Children were not provided any benefits as well.

Nike became synonymous with “Slave” workers because of the low pay its contactors

used to give to the laboursIn most places labours were forced to workovertime mostly without incentivesOSHA clean air standards were not followedin the factories which amounted to extremelyharsh working conditions

Allegations

Against

Nike

CSR

Violations



Corrective

Measures

CSR

Violations

All Nike Factories are rated using Nike’s Sourcing & Manufacturing Sustainability

Index (SMSI) – all suppliers and outsourced factories must follow same index The Sustainable Manufacturing Excellence team is formally aligned to both SB&Iand NIKE’s sourcing functions Nike integrated its Manufacturing Index which includes the Sourcing &Manufacturing Sustainability Index into our sourcing selection and evaluation criteria Established Project Rewire - To connect impacts of sourcing with decision makers Align sourcing decisions by the end of FY20 toprioritize sourcing in factories that haveeliminated excessive overtime Incorporate factory labour and environmentalperformance criteria into production vendorsourcing selection and evaluation In 2012, NIKE shared its manufacturing

vision: to create and deliver great productsthrough a sustainable, NIKE, Inc. sourcing base.







CSR INITIATIVES BY NIKE INC

Designed to move

•

A movement initiated by Nike Foundation in collaboration•Seeks to capture women’s potential to end their poverty •Driving massive resources to women to empower them

Girl Effect

Lace up Save Lives

•Initiative meant to boost the declining physical activity ofpopulation•5 phases of framework that achieves the 2 asks

•Fighting Aids in Sub-Saharan Africa•Donating billions to governments andNGOs to fight Aids•Providing publicity to the cause at aninternational level



The

Girl

Effect

The Nike Foundation, in collaboration with the NoVo Foundation, United NationsFoundation and Coalition for Adolescent Girls, started the movement called “Girl Effect”. This movement seeks to capture the potential of adolescent girls to endtheir poverty. The rationale behind the movement is supported by 2012 reportreleased by the World Bank:

India loses $383 billion in potential lifetime income due to 4 million adolescent

girls who become mothers each year.If girls in Kenya completed high school, the economy would gain $27 billion overtheir lifetime.In Nigeria, if women had the same employment rate as young men, the countrywould add $13.9 billion to its economy annually



Designed

To

Move

Nike’s initiative “Designed to move” aims to increase the level of our population’s physical activitywhich seems to be on the declining trend.

Action Plan: The framework was developedand inspired by existing recommendationspromoted and discussed in the field. There arefive phases of action that provides aframework oriented toward the two asks that

enables unified and accelerated action

Situation: In many countries, physical activity isdisappearing from daily life. It happened in just oneor two generations in some countries, and evensooner in others. Our physical, emotional and

economic well-being has become increasinglycompromised as a result. The time for action is now



Lace Up

Save

Lives

As a part of the Product Red brand Nike launched “Lace up Save Lives” campaign

to fight Aids, tuberculosis and malaria in Africa. They used the likes of MariaSharapova, Kobe Bryant and Didier Drogba to support the cause.Nike has released a special line of red shoelaces, with the entire profit going to thecharity. The profits of the sales goes to Global Fund to Fight AIDS, Tuberculosisand Malaria (GFATM), an international organization that aims to attract anddisburse additional funds to prevent and treat AIDS, tuberculosis and malaria.



Integrating

CSR with

Business

Sustainable

Innovation

Innovation

CSR has led to innovation. Development of new effective methods of production.Recycling of old materials to reduce cost. Introduction of new materials neverused before hence creating a new consumer segment for itself.



Sustainable

Innovation

Plastic landfill has been a major problem for the past few years. Toaddress this issue, Nike has come forward with the idea of recyclingplastic. Since 2010, Nike has diverted 2 billion plastic bottles fromlandfills and has used the recycled polyester to produce sports kit. Infact, in 2014, Brazil national team kit has been made with recycled

polyester for superior performance innovation.

Integrating

CSR with

Business



Integrating

CSR with

Business

Sustainable

Innovation

Using Recycled Polyester formanufacturingUsing new rubber formulations whichis being used in rubber compoundsUsing organic cotton and hybrid cottonwhich consumes less water

Using of leather that do not requiresolvents for processingProcess leather in facilities that arerated by The Leather Working Group



Integrating

CSR with

Business

Sustainable

Innovation

63% of scored footwear productachieved a silver rating or better inour first season using the new index

51% of scored new apparel productachieved a bronze rating or better inour first season using the new index

32% of scored equipment product(bags only) achieved a bronze ratingor better in FY13. A new equipmentindex will be launched in the fourthquarter of FY14

The average total NIKE MaterialsSustainability Index score – assessingchemistry, energy/ ghg emissions,water and land-use intensity andphysical waste of the base material;vendor practices; and additionalenvironmental criteria



Integrating

CSR with

Business

BUSINESS

STRATEGY

Employee EngagementNike is able to engage their employees insocial activities which helps theemployees gain a lot of satisfaction.Satisfied workforce means better results

Reputation Management

Nike has been able to ward of thecriticism and negative publicity it hadreceived during the 1990s. Its goodwill

and brand image has improved over the years due to its contribution to thesociety through CSR.



Integrating

CSR with

Business

Increasing Global FootprintNike products are available in almost all the countries. Theirsustainability model has gone down well with most nations and itshelping Nike to capture a larger chunk of the global market.

BUSINESS

STRATEGY

i



Integrating

CSR with

Business

CORPORATE

PHILANTHOPY



Impact

Analysis

• Nike’s support for Hurley’s H2O non-profit partner Waves For Water hashelped an estimated 5 million people gain access to clean water throughportable water solutions• The NIKE N7 Fund provides grants to Native American and aboriginalcommunities in the United States and Canada in support of sports andphysical activity programs for youth. Since 2009, approximately $1.8 million

has been directed to these communities.• Involving kids from Africa in Sports for Social Change Network to promote theuse of sport as a vehicle to achieve lasting social change

LEVERAGING BRAND POWER



I



Impact

Analysis

THE GIRL EFFECT

•A high-profile launch of Smarter Economics: Investing in Girls at the annualmeetings of the World Bnk and International Monetary Fund in 2012; thisreport makes the economic case for investing in adolescent girls• The opening of Girl Hub Ethiopia and the launch of the Yegna-brand radiodrama and girl band to connect, inform and inspire girls across Ethiopia• Ensuring girls were included in commitments made at the London Family

Planning Summit in 2012, where over $4 billion was pledged to tackle theunmet family planning needs of 120 million girls and women by 2020

I t



Impact

Analysis

EMPLOYEE ENGAGEMENT

Nike’s WE Portal brings together employees around volunteering, service, givingand community activities that matter most to them. NIKE launched a new WEPortal in FY13, providing enhancements to their online experience. The newportal includes features that allow employees to create volunteer teams in theircommunities, design specific cause campaigns and engage directly withqualified and vetted non-profit organizations. Globally, employees used the

portal to track personal contributions of $2.5 million to non-profit organizationsduring FY12 and FY13, which NIKE matched with an additional $2.4 million

I t



Impact

Analysis

DISASTER RESPONSE

When disaster strikes a community, Nike mobilize to help where they can have

the greatest impact. For instance, in the aftermath of widespread damage to theUS East Coast caused by Superstorm Sandy, it committed $2 million torebuilding efforts in New York and New Jersey and an additional $1 millionworth of product donations to New York City non-profit organizations. HurleyH2O and Waves For Water also helped mobilize relief efforts reaching 350,000people by distributing essential supplies, rebuilding 150 homes and donating40,000 meals.

I t



Impact

Analysis

DISASTER RESPONSE

In 2013, Nike also responded to the earthquake in Chengdu, China, by working

with local partners to provide humanitarian assistance. And after the tornadosin Oklahoma in May 2013, it helped rebuild playgrounds and support NativeAmerican tribal communities through our N7 program.

Chengdu

Earthquake,

China, 2013



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Group6 DivD Presentation Nike