Executive Summary

Corporate social responsibility is fast becoming an integral part of the corporate world. It has
been observed in recent times that the society's expectations on business is slowly taking center
stage and businesses are embracing various initiatives to comply with these expectations through
Corporate Social Responsibility.

 This project adopts to study the activities of NIKE which is the leading manufacturer and
distributor of sportswear and equipment.
 This project seeks to unveil the answer to this question: Does NIKE comply with its
Corporate Social Responsibility?

To be able to fully answer these questions this paper will seek to create an understanding
of NIKE as an organization: its scope, vision and an understanding of the business
context in which it is operating. It will further delve into understanding of Corporate
Social Responsibility as a whole: its meaning, importance and influence of organization's
practices and structure.

This project will finally seek to review NIKE's Corporate Social Responsibility Policy
seek to identify its activities that are in line with this policy and identify its unethical
practices if any.
 Company Introduction
Work Culture:
NIKE, Inc.'s heritage is deeply rooted in innovation and we believe diversity and inclusion are
key levers in continuing to drive creativity and innovation. It takes every one of our more than
30,000 employees working at the top of their game for NIKE, Inc. to reach its highest potential.
And we know that outstanding teams are composed of people with diverse backgrounds,
perspectives and skill sets.

Company Values/Mission Statement:

Bring inspiration and innovation to every athlete in the world if you have a body, you are an
athlete. Nike's philosophy is that they simply believe. As stated by their CEO We believe in
potential, not limits. The 4-minute mile was safe, until Roger Bannister. Lou Gehrig’s 2,130
straight games was safe, until Cal Ripken. No one would ever clear 29 feet in the long
jump, until Bob Beamon. Nobody would ever beat Bob Beamon, until Michael Powell.
That’s how it is with NIKE. We believe. They take this philosophy and are able to provide the
best products in the business, every year NIKE comes out with new innovative shoes and
clothing apparel to help take an athlete to the next level of performance. 

Growth and Stability:

Our world faces unprecedented change: constrained resources, population growth, heightened
connectivity, increased demand. In a world of finite natural resources, our growth is enabled by
infinite human resources: innovation and inspiration. We understand that innovation through the
lens of sustainability is fundamental to achieving our vision of growth that is not dependent upon
constrained resources. Indeed, creating and building business models that not only recognize and
accommodate but thrive on the constraints of the natural world is the only way we can achieve
growth in the present that won’t compromise our ability to grow and succeed for decades to
come. Of course, this transition is challenging for a company that sells physical products and has
bold ambitions to provide those products to more people in more places worldwide.
Transforming NIKE in this way will take time and is a long-term commitment. It touches every
aspect of our business, from how we design and make our products to how we engage our
employees and other businesses in our value chain. It begins with placing sustainability at the
beginning of the innovation process.

Company Caveats:
Nike is one of the top companies in the world with little negatives aspects. They have been on
the up since they started out and they show no signs of slowing down. Even in times of economic
distress Nike doesn't slow down. The company does not expect a decrease in sales; it expects
sales to continue to rise this year and beyond. “During times of economic challenge, consumers
will go to brands that they trust and can connect with. We have not seen the economy have a
dramatic impact on the sales of our products, not just in the high end, but also in the mid-priced
range,” Chief Executive Mark Parker said.
Company Reputation:
Nike is the top athletic manufacturer in the world.  Over the last two decades, athletic footwear
has grown tremendously.  In 1985, in the US alone, athletic footwear was a 5-billion-dollar
business with 250 million pairs of shoes sold.  In 2001, that number almost tripled, it became a
13-billion-dollar business with 335 million shoes sold.  In the athletic manufacturing business
Nike takes the lead with Reebok and Adidas as strong competitors.

Company Competitors:
Reebok, as the second leading manufacturer of footwear, has domestic revenues of $1.28 billion
and a market share of 16%. Similar to Nike, they also utilize a 100% outsourcing strategy and
manufacture their products throughout Asia. Adidas is currently enjoying the fastest growth of
any brand domestically, with a market share of 6% and revenues of $500 million. With a market
share of 3% and revenues of $280 million, Converse manufactures their products both
domestically and internationally. New Balance is the one company that has kept a substantial
amount of manufacturing in the United States, and has a 3% market share with sales of $260
million.

Company Investments:
The Nike foundation was established in 2004, The Nike Foundation’s own investments have
directly helped more than 500,000 girls around the world to fulfill their potential, providing
grants to more than 100 organizations in more than 80 countries over nine years — including:
giving girls in Nigeria the chance to stay in school; helping girls in India to claim equal rights to
inherit and own land; and giving girls across Rwanda critical health information and mentoring.
In the 1990s, research from the Population Council and International Center for Research on
Women began to show that when an adolescent girl in poverty is able to stay in school, delay
marriage and delay having children, not only do her life chances radically change, but the
children she will later have are far more likely to be healthy and educated. By investing more in
girls, governments and international organizations could break the cycle of poverty from one
generation to the next. 

Locations:
Nike has contracted with more than 700 shops around the world and has offices located in 45 countries
outside the United States. Most of the factories are located in Asia, including Indonesia, China, Taiwan,
India, Thailand, Vietnam, Pakistan, Philippines, and Malaysia. Nike is hesitant to disclose information
about the contract companies it works with. However, due to harsh criticism from some organizations
like CorpWatch, Nike has disclosed information about its contract factories in its Corporate Governance
Report.
 Sponsorships

Nike pays top athletes in many sports to use their products and promote and advertise their
technology and design.

Nike's first professional athlete endorser was Romanian tennis player Ilie Năstase. The first track
endorser was distance runner Steve Prefontaine. Prefontaine was the prized pupil of the
company's co-founder, Bill Bowerman, while he coached at the University of Oregon. Today, the
Steve Prefontaine Building is named in his honor at Nike's corporate headquarters.

Nike has also sponsored many other successful track and field athletes over the years, such as
Carl Lewis, Jackie Joyner-Kersee and Sebastian Coe. The signing of basketball player Michael
Jordan in 1984, with his subsequent promotion of Nike over the course of his career, with Spike
Lee as Mars Blackmon, proved to be one of the biggest boosts to Nike's publicity and sales.

Nike has been the official kit sponsor for the Indian cricket team since 2005.

Nike is a major sponsor of the athletic programs at Penn State University and named its first
child care facility after Joe Paterno when it opened in 1990 at the company's headquarters. Nike
originally announced it would not remove Paterno's name from the building in the wake of the
Penn State sex abuse scandal. After the Freeh Report was released on July 12, 2012, Nike CEO
Mark Parker announced the name Joe Paterno would be removed immediately from the child
development center. A new name has yet to be announced.
Nike also sponsored soccer players such as Ronaldinho, Ronaldo, Cristiano Ronaldo, Didier
Drogba, Neymar, Zlatan Ibrahimović, Wesley Sneijder, Wayne Rooney and Landon Donovan,
among others.

RESEARCH METHODOLOGY:

Objectives Analysing secondary data.

1. Study CSR initiatives of NIKE to for sustainable business performance.

SOURCE OF DATA:

SECONDARY DATA: Websites, Academic Books and National periodicals and News
Papers.
My study is based on secondary data.
 Introduction to CSR
Corporate Social Responsibility involves the organization’s commitment to ethical behavior and
to the improvement of the quality of life to their workforce, local community, and the whole
society (Szekely and Knirsch, 2005). It involves the realignment of company policies to comply
with the expectations of stakeholders. These stakeholders may include employees, regulators,
special interest groups, suppliers, and the whole society.  Issues commonly in question may
include the provision of adequate wages to employees where at the very least the minimum wage
is paid; provision of clean and healthy working environment; company efforts to minimize waste
and negative impact to the environment; and participation in social responsibility programs
aimed at improving the welfare of the society (Freeman, Velamuri, & Moriarty, 2006). Corporate
Social Responsibility is voluntary and normally exceeds the regulatory requirements by the
governments in which the companies operate.

Importance of CSR to organizations

To justify the commitment of organizations, it is important to look into what these organizations
stand to gain by embracing CSR. CSR is increasingly turning out as a tool of survival in the
turbulent competitive global business environment. Recent research shows that consumers are
increasingly sensitive about the level of social responsibility embraced by the organizations they
buy their goods from. The companies that are seen to contribute more to the welfare of the
society tend to gain more support from the consumers who generally prefer to buy their products.
CSR hence leads to higher revenues in many cases (Szekely and Knirsch, 2005). The question of
attraction and retention of competent and highly innovative employees also comes in when
determining the importance of CSR. Employees are generally known to prefer working for
companies that are highly regarded in the society and whose practices at par with stakeholder
expectations (Stanford Graduate School of Business, 1998). With good CSR, organizations can
attract quality employees that will push innovation and productivity higher leading to improved
bottom lines. Employee motivation also soars when they realize that the organization cares about
their welfare and that of the society in which they live (Stanford Graduate School of Business,
1998).Organizations with good CSR practices are also able to raise the capital needed for new
ventures with relative ease as the investors tend to trust them more easily. CSR therefore proves
important by improving chances of expansion to the organizations. Perhaps the most compelling
reason why many companies engage in CSR is the likely backlash that could be allocated to
them by failing to embrace the CSR. Special interest groups and activists have in recent times
stepped up their investigation of business practices in a bid to ensure business comply with a
certain minimum in good corporate practices especially as pertains to the environment and
employee welfare. Companies that are found wanting would often be subjected to adverse
negative publicity that could potentially drive them under. This is because of initiatives such as
boycott campaigns against such companies and a general negative feeling towards the company’s
products by the consumers.

The influence of CSR on corporate practices

Having recognized the importance of CSR corporate organizations are faced with the challenge
of realigning their philosophies and practices to suit good CSR practices. The structures for most
companies have also been realigned to ensure the success of their CSR programs. Most
organizations have formed executive level teams that function across departments to design and
implement CSR initiatives (Boston College Center for Corporate Citizenship, 2010). In 2008,
about 18% of companies surveyed had such teams. This number went up in 2010 to 31% (Boston
College Center for Corporate Citizenship, 2010). Many more companies have established an
office, mostly at executive level to attend to matters of CSR. About 27% of companies surveyed
had such a position and the number had risen to 44% in 2010 (Boston College Center for
Corporate Citizenship, 2010). Emphasis on CSR has also been able to influence the production
processes of organizations with an aim to reduce the amount of waste that would otherwise
impact negatively on the environment. Introduction of recycling plants to reuse company wastes
is one famous example. The implications on the emphasis on employee safety and welfare also
have a bearing on the company’s investment on safety equipment and in most cases, a
significantly higher wage expense (Freeman, Velamuri, & Moriarty, 2006).

With the increasing sensitivity of consumers to organizations’ social responsibility ratings,

organizations have been motivated to invest more into good CSR practices. Consumers are
known to be generally more supportive of companies with good CSR practices. More and more
companies are therefore paying more attention to articulation of their CSR policies and
accordingly changing company structure and practices to suit such policies.
  Nike’s Policy on CSR
Nike was a subject of heated criticisms in the 1990s because of its Asian labor practices. The
negative publicity from these criticisms was a threat to its market leadership and they countered
this by trying to refine their CSR policy. They established an executive level multifunctional
team with the responsibility to drive compliance with CSR and environmental standards (Nike
Inc, 2009). As a result, Nike was able to refine its production processes to cut waste and reduce
environmental degradation.  Their attention was also drawn to the workers and their
responsibility to these workers. They therefore designed a supplier’s code of conduct for all their
suppliers in order to ensure the values they hold dear including provision of healthy working
environments are adhered to. Nike has embraced a CSR policy that it observes and tries to
impress on their suppliers as well to observe.

Nike has a well defined code of ethics which it ensures is internalized and practiced by their
employees and have been advocating that the ethics benchmarks be observed by their suppliers
as well (Nike Inc, 2009). Nike’s efforts to reduce waste to conserve the environment saw them
win the Gigaton Award which is an award given to organizations to recognize their efforts in
reducing carbon emission and making a difference in climate change. In a nutshell, Nike strives
to ensure sustainable production that causes least negative impact on the environment while
ensuring the well being and safety of their employees. Nike also embraces social responsibility
and engages in community giving in order to improve the welfare of the communities around
them. Nike has a global workforce of about 100 employees who are fully dedicated to fueling
innovation and transition of company policies and practices to be in line with their Corporate
Social Responsibility goals (CSR International, 2010).
Company CSR Policy
UNLEASH HUMAN POTENTIAL
If you have a body, you are an athlete” – Bill
Bowerman NIKE cofounder and celebrated track coach
NIKE’s approach to employee and business growth is fueled by the belief that diversity – in all
its forms unlocks innovation. We know that leveraging different perspectives, experiences, and
backgrounds generates unique ideas. To enable this, it’s imperative that we continue to build a
creative and inclusive culture, where all voices are welcomed and heard.

Target- Attract and develop an increasingly diverse, engaged, and healthy workforce.

Measure-Provide visibility to our diversity and inclusion progress.

In 2019, we maintained a sharp focus on building diversity at the most senior levels, because we
know increasing diversity of leadership is fundamental to progress; leaders help shape culture
and set the tone from the top. In addition, we continued to broaden the diversity focus at the
manager level and above, while also supporting early-career employees in their efforts to
advance we increased representation of women at the VP-level by 3 percentage points (p.p.) and
U.S. URG by 2 p.p.. We are pleased with our progress to date and are building momentum with
consecutive years of growth. Still, we know there is more to do – and we’ll continue to focus on
recruitment, promotion, and retention as levers to drive further increase in representation.

NIKE appointed one new Board Director, Thasunda B. Duckett, CEO of Chase Consumer
Banking at JP Morgan Chase & Co. Duckett has been named one of Fortune’s “Most Powerful
Women to Watch” and one of the “Most Powerful Women in Banking” by American
Bankermagazine. In addition to her leadership in the financial industry, Duckett is executive
sponsor of JPMorgan Chase’s Advancing Black Pathways program which is directed toward
helping black Americans achieve economic success through wealth, education, and careers.

We continue to track progress against our interviewing policy adopted in 2018, which requires
gender and racial/ethnic diversity among external candidates at Director-level and above in the
U.S. Our focus on women and URG candidates plays a critical role in hiring for leadership roles.
We look forward to expanding this policy more broadly in the future. Through 2019, we saw a
10% increase in the hiring of women at Director-level and above, and a 4% increase in the hiring
of U.S. URG at Director-level or above.
In 2019, we created and launched the following uniquely NIKE programs:•

Nike X Design: This apprenticeship program between NIKE and the community college system
of Los Angeles offers students an opportunity to gain work experience in design, footwear, and
apparel graphics and color as part of a six-month rotational program. •

Serena Design Crew: In 2019, NIKE and Serena Williams teamed up to select a design
collective of 10 talented individuals to participate in the Serena Design Crew. This group will
work together to create a Serena-inspired collection during an eight-month apprenticeship
program that started in January 2020.

Women in Nike (WIN): We continue to invest in WIN, our unique two-year program that
provides work experiences for retired or retiring WNBA players. Through this initiative, former
professional basketball players join teams at NIKE’s World Headquarters (WHQ) in various
roles across the organization.

EQUAL PAY FOR EQUAL WORK: We are committed to competitive pay and to reviewing
our pay and promotion practices annually. At NIKE, we define pay equity as equal compensation
for women, men and all races/ethnicities who undertake the same work at the same level,
experience, and performance.