Nike has had the lead in the ESG game for a while, but that doesn’t mean change isn’t constant.
Nike’s Purpose strategy – comprising people, planet and game – has been entrenched since Nike was founded 50 years ago, despite just over 20 years of formal ESG reporting. Yet the giant is navigating the new holistic landscape of sustainability with more agility and speed than ever before – and everyone is on board.
With around 75,000 employees, Nike said its employees are actively engaged in the footwear giant’s sustainable goals.
“There is so much desire within Nike’s employee base to be involved in all of our areas,” said Noel Kinder, Nike Inc.’s chief sustainability officer, in an interview with WWD alongside other executives. by Nike Purpose. “When we were still on campus, people would come up to me every week saying, ‘Hey, I don’t work in sustainability, but how can I help?’ I think ‘impact’ is a very important word.
Today, Kinder said, Nike embodies an “operationalization of sustainability” rather than a top-down approach with few leaders in the driver’s seat.
Jorge Casimiro, director of public policy and social impact at Nike Inc., echoed his reasoning. “It’s the people who make it all possible. It has always been the case… There have always been externalities and there will always be externalities. I think for us it’s how are we committed responsible leaders who are part of the solutions? We can’t solve everything alone, we have to work together.
The human component also materializes in the discourse of investors. Last year, Nike tied its goal targets to executive compensation, including a goal to invest $125 million in organizations supporting racial equity by 2025 ($36.6 million at during the 2021 financial year). In 2021 alone, Nike committed $36.6 million to community organizations.
Environmentally, Nike was the first in the footwear industry to publish a list of its contract factories and was a founding member of the Sustainable Apparel Coalition. Given its large footprint, the company is already diverting 100% of manufacturing waste from Tier 1 shoe suppliers from landfill and forging new paths to circularity like its upcoming “Link” (debuting June 2022) and the sneaker “Link Axis” (the latter more for show and won’t arrive until 2023). The new sneakers are glueless and designed for disassembly.
“Circularity is a really big unlock,” Kinder said. “The nirvana would be if you buy a pair of shoes and use them to the point that they are worn out, take them back and break them down so that their basic components are put back together in another shoe. We’re not there yet, but many elements of this concept of circularity exist, like Space Hippie, where we’re starting to use waste as a raw material. You see that in these crazy Axis shoes that can be broken down into stock parts. I really feel like this is the future of sustainability innovation.
With the anticipation of the Nike Link sneaker, any Nike store with Recycling & Donation service will be able to take back the shoes.
However, all this forward momentum is not without obstacles.
Climate is an area of growing obligation, given the company’s size and influence on the footwear industry. In Nike’s latest impact report, employee and supplier engagement were two areas where slippage occurred within the company last year due to increased reach.
Highlighting supply chain nuances and pandemic challenges, Kinder said, “We have expanded the scope of what we audit in our supply chain to include our textile manufacturers, even some of our suppliers. third-party logistics… and unsurprisingly, there were challenges. when you start exposing new partners at this rating level. And we’ve seen a drop in performance, and that’s what we expected, because we take a partnership approach with everyone we work with. We work hand-in-hand to make sure they understand the nuance, understand what we hold them accountable for, and correct appropriately.
Mayo pointed to a similar nuance in internal employee engagement in the face of pandemic-induced change.
“We have gone through a lot of changes in two years. We recognized that we really didn’t wait for annual engagement surveys, we regularly challenge our employees – as many other companies do – to better understand where they stand as change happens so quickly… We want to ensure we meet our employees where they are when they return to work,” Mayo said, stressing the importance of mental health, consistent furloughs for retail workers, childcare in business and a host of other needs. (Not to mention Gen Z arriving in force to influence workplace culture).
Since last year, Nike has increased the number of racial and ethnic American minorities at the manager level and above by more than four percentage points to 30.3%, while also increasing the number of women in management positions. leadership in the world by almost four percentage points to 43%. .
“DEI equals innovation,” Mayo said. “We recognize that here at Nike. It’s part of our journey, and in the next 50 years you’re going to see it explode. It’s really exciting… From a people’s point of view, people are asking for so much more. Purpose is squarely at the center of decisions; what company to work for, where they decide, as consumers, to give their money… In the future, we will have to work for the next 50 years.