Nike is one of the most popular activewear brands in the world, so just how ethical is Nike? Our research shows the brand is making a start, but the sportswear giant still has work to do across the board. This article is based on the Nike rating published in February 2022.
From sweatshops to ‘It’s a Start’
Though it seems every man and his dog owns a pair of Nikes, not so long ago, the Nike image was synonymous with sweatshops and unethical manufacturing. So how does this brand rate today when it comes to its treatment of People, Planet, and Animals? How ethical and sustainable is Nike?
Nike had been accused of using sweatshops to produce its sneakers and activewear since the 1970s, but it was only in 1991 when activist Jeff Ballinger published a report detailing the low wages and poor working conditions in Nike’s Indonesian factories that the sportswear brand came under fire. Soon after, it became the subject of an aggressive and sustained campaign by United Students Against Sweatshops. Nike was initially slow to respond—but under increasing pressure, it eventually made some changes by improving its monitoring efforts, raising the minimum age of workers, and increasing factory audits.
The brand has since earned plaudits far and wide for its efforts. A few years ago, Business of Fashion reported that Nike has successfully transformed its tarnished image to become a “recognized sustainability leader.” Morgan Stanley even ranked Nike “the most sustainable apparel and footwear company in North America for environmental and social performance, including its labour record.”
But is this actually the case?
A step backwards
Though Nike has successfully improved its reputation and has become the top-selling activewear brand globally, many of its practices are still problematic.
In 2017, Nike took a big step backwards, as the International Labor Rights Forum reported that the company had turned its back on its commitment to the Worker Rights Consortium (WRC). This move effectively blocked labour rights experts from independently monitoring Nike’s supplier factories. But in 2021, Nike received a 51-60% score in the Fashion Transparency Index (in the same scoring range as the previous year), showing it started going in the right direction again. It’s like Nike is in an on-again-off-again relationship with doing the right thing, begging for some stability.
We rate Nike “It’s a Start” for the planet. Though Nike has made a few positive changes to its environmental practices and is a member of the Sustainable Apparel Coalition, it still has a way to go before it can truly be called a sustainable brand. Nike uses some eco-friendly materials, including organic and recycled cotton and polyester, and has water reduction initiatives in its supply chain. The brand has also set a deadline to eliminate hazardous chemicals by 2025 and the good news is that it is on track to meet its target. But while Nike has set a science-based target to reduce greenhouse gas emissions generated from its operations and supply chain, there is no evidence it is on track to meet its target.
Nike’s labour rating is also “It’s a Start”. Though the brand has focused on female empowerment and inclusiveness in its advertising campaigns, the women who work for Nike—from factories to headquarters—are seemingly left out of this picture. In 2018, Nike was sued by two former female employees who accused the sneaker giant of creating a culture of gender discrimination and sexual harassment.
On a positive note, the company is Fair Labor Association (FLA) Workplace Code of Conduct certified. It also implements practices to encourage diversity and inclusion in some of its supply chain and discloses adequate policies to protect suppliers in its supply chain from the impacts of COVID-19 but not workers.
The Foul Play report by the Clean Clothes Campaign and Collectif Ethique sur l’Etiquette shows just how far Nike has to go when it comes to living wages. It highlights the difference between the ever-increasing amount of money paid on sponsorships to sports stars and other marketing expenses, compared to the reduction of the share of the final price of your sports gear paid to workers in the supply chain. The report calls on both Nike and Adidas to commit to paying living wages across their supply chains by a specific date and other supporting action. Read more about living wages for garment workers here.
In previous ratings of Nike, we couldn’t find evidence the brand ensured payment of a living wage in most of its supply chain. When we reviewed the brand in February 2022 however, we found that Nike now ensures payment of a living wage in a small proportion of its supply chain, which is an improvement. Of course, it’s a tiny step in the right direction, and we urge Nike to expand this initiative to its entire supply chain.
Nike does not use fur, angora, or other exotic animal hair or skin in its products, which is a step in the right direction. However, it does use leather, wool, and down feather without specifying sources. This lack of transparency is problematic as the welfare of animals and workers is unknown. Because of this, we have given the brand a rating of “Not Good Enough” for animal welfare and hope for more progress soon.
Overall Rating: It’s a Start
So, how sustainable is Nike? Overall, we rate Nike “It’s a Start” based on information from our own research. Though Nike has a few promising environmental measures in place, it’s clear that the company is not doing as much as it should and needs to make serious changes in most areas. With an annual revenue of over $44 billion in 2021, the sportswear giant can certainly afford it.
Good On You ratings consider hundreds of issues, and it is not possible to list every relevant issue in a summary of the brand’s performance. For more information, see our How We Rate page and our FAQs.
If you love the Nike vibe but prefer to support brands doing “Good” or “Great”, we’ve rounded up some more sustainable alternatives to Nike for you below.