Nike report debuts sustainable factory index
By Erik Siemers
Nike's waste-reducing Flyknit technology is an example of Nike's focus on sustainable manufacturing.
Nike Inc. on Thursday issued a summary of its sustainability performance over the year that also sets a series of new business, labor and environmental goals.
The Washington County sports apparel and footwear company (NYSE: NKE) also unveiled a new factory rating system to measure the sustainability performance within its factories, including labor issues.
“We have continuously invested in reducing our environmental and social impacts within our own business and supply chain and have made substantial gains over the last decade,” CEO Mark Parker said in a news release. “We know we cannot achieve our bold sustainability goals simply by delivering incremental improvements. We need to deliver innovations that rapidly evolve the way things are done at Nike, in our industry and throughout business.”
A key element of Nike’s "FY10-11 Sustainable Business Performance Summary" released Thursday is the new Manufacturing Index, a measurement guide intended to take a deeper look at how a contract factory approaches sustainability.
Within it is the Sourcing & Manufacturing Sustainability Index, which evaluates each factory in areas such as water use, energy consumption, carbon output, health and safety, and labor management issues.
The index was developed over the past two years and introduced initially as a pilot program. It’s now being rolled out across the company’s supply chain, and is expected to play a significant role in how the company chooses its contract factories.
By the end of fiscal 2020 Nike said it plans to source only from contract factories “that demonstrate their commitment to workers and sustainability.” That means the factory must achieve, at a minimum a “bronze” rating on the company’s new Sourcing & Manufacturing Sustainability Index.
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