Copyright 1997 Journal of Commerce, Inc.
Report on Nike mostly positive
BY TIM SHORROCK
June 25, 1997 Journal of Commerce
Nike Inc. should use its ""enormous leverage'' over its Asian subcontractors to improve grievance procedures for workers and promote external monitoring of its factories by outside experts, according to a report issued Tuesday by former U.N. Ambassador Andrew Young.
Mr. Young's report, written at the request of Philip Knight, Nike chairman, praised conditions at Nike's factories in China, Vietnam and Indonesia, saying no ""systematic abuses'' of workers were uncovered. But it avoided the contentious issue of wages and living standards.
""Nike should support some kind of third-party monitoring'' and consider hiring an outside ombudsman in addition to its use of accounting firms like Ernst & Young, Mr. Young said in a news conference broadcast from Atlanta.
He also urged Nike to be ""more pro-active'' in promoting its code of conduct in Asia and addressing worker rights. That is important because in countries where Nike operates ""there are questions about how free and independent'' unions are, he said.
Nike issued a statement saying it will adopt Mr. Young's suggestions, terminate contractors that violate its code and test a pilot project on independent monitoring.
Mr. Young's decision not to address wage issues, however, drew immediate fire from Nike critics.
""The crux of the whole issue is wages,'' said Medea Benjamin of Global Exchange, a San Francisco group that is organizing an international day of protest against Nike in October.
""It's bad enough that Nike - a corporation with $6.5 billion in annual revenue and over $600 million in profits - refuses to pay its workers a liveable wage,'' Ms. Benjamin said. ""It's morally reprehensible for a former civil rights leader to justify that.''
Mr. Young and his company, Goodworks International, was hired by Nike to review its code in January.
His report will be closely watched by the Clinton administration and labor activists alike. Nike was a member of President Clinton's anti-sweatshop task force that is drafting workplace and monitoring standards for U.S companies that subcontract overseas.
The factories in Asia that Mr. Young visited ""were clean, organized, adequately ventilated and well lit'' and ""certainly did not appear to be what most Americans would call "sweatshops,' '' the former civil rights activist said.
At the same time, Nike's code of conduct ""is not visible on the factory floors and not well understood by the workers,'' Mr. Young said. He said third-party monitoring is necessary because Nike's factories are owned and run by Asian companies contracted to Nike.
Hoang Thi Kanh, vice president of the Vietnam General Confederation of Labor, said Nike has exaggerated the buying power of Vietnam's $45 a month minimum wage for a foreign joint venture.
That wage, Ms. Kanh said in an interview last week, is enough for a family with one child ""but only if the spouse goes to work.'' Ms. Kanh said Nike should be more involved in its subcontractor operations.
""I want the Nike company to come to Vietnam to observe the situation directly and meet with workers,'' she said. The confederation is an umbrella organization of unions ultimately controlled by the Vietnamese government.
Thuyen Nguyen, a Vietnamese-American who has criticized conditions at Nike factories in Vietnam, said it was ""difficult to understand'' why Mr. Young didn't look at forced and excessive overtime and factory managers' use of corporal punishment.
But Mr. Nguyen said some of Mr. Young's findings might provide a useful pressure point on the company. ""Coming from him, some of these recommendations might be a good thing,'' he said.
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