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Setting the Swoosh Straight

Young's personal suggestion was that the Nike Code of Conduct should be the basis of the relationship between the company, plant owners and managers, and workers, and that the Code should be "aggressively enforced." The report called for Code of Conduct training sessions, the hiring of more indigenous management, and "special human relations and cultural sensitivity programs."

Other recommendations included suggestions that Nike:

"continue its efforts to support and implement the provisions of the Apparel Industry Partnership, which resulted in the first major agreement -- across industry lines -- to set voluntary, global standards and goals for international labor practices."

"promote the development of workers' representatives in the factories to effectively represent the workers' individual and cumulative interests."

"insist that the factories that manufacture its products create and enforce a better grievance system within the factory."

"expand its dialogue and relationship with the human rights community and the labor groups within the countries where they produce goods and with their international counterparts."

"consider some type of 'external monitoring' on an ongoing basis to ensure effective application of the Code of Conduct," continue professional audits by Ernst & Young and Price Waterhouse, and "consider establishing an 'ombudsman' in each major country with manufacturing facilities."

The trouble with these "solutions" is that they will not solve the real problems. Nike and other shoe and apparel makers already have agreed to "voluntary global standards," yet problems persist. And as VLW noted based on their experiences in Nike plants, "any visit, study or audit using interviews of workers within the confines of the factory will not be accurate. To be valid, the worker interviews must be done outside the factory by people who can guarantee workers their anonymity." More dialogue, monitoring and grievance-airing are worthwhile in theory, but will not work in practice without aggressive enforcement by Nike, which Young did not seem to advocate in his report.

Recommendations from VLW's "Nike Labor Practices in Vietnam" report were considerably more far-reaching and pro-active. The report called for the company to:

Abandon the use of illegal and unethical training/probationary wages and stop paying sub-minimum wages under the guise of providing vocational training. "Wages in Vietnam are already at rock bottom," the report stated. "There is no need for Nike to pay workers any lower than the $45 monthly minimum wage."

Put the Code of Conduct above even quality and cost and demand that all managers who use corporal punishment or are guilty of sexual harassment be dismissed. "The current approach of having no specific punishment for violating the Code of Conduct generates the impression that the Code has no teeth."

Levy a stiff monetary penalty on the contracting company whenever it violates the Code of Conduct. "Companies tend to respond well to severe monetary fines. With so many repeated violations after only 18 months of operation in Vietnam, this is the only course of action left to demonstrate to outsiders that Nike is serious about enforcing its Code of Conduct."

Enforce the 60 hour work week specified in its Code. "The current practice of excessive, forced overtime (sometimes over 70 hours per month) would be considered abusive by any standards."

Be a good corporate citizen in Vietnam. "Nike cannot assume that creating low paying jobs is good enough. Vietnamese workers -- and their supporters around the world -- will not simply be grateful for the jobs and ignore the deplorable labor practices in the factories."

Work directly with the Vietnam General Confederation of Labor to hear the complaints from workers and talk with workers outside the factory environment. "We found that as long as the workers remain within the confines of the factory, they are very fearful and are not willing to talk about their conditions to anyone."

Consult with Vietnamese shoe factory experts and on how to establish better labor practices. "Thai Binh and Hiep Hung. Both are Vietnamese companies and both are producing high-quality shoes for Western shoe companies such as Reebok and Fila. The presidents of both of these companies have expressed their willingness to consult with Nike on how to treat its Vietnamese workers."

Form an independent monitoring board in Vietnam made up of representatives from neutral parties, including government labor officials, NGOs, and labor unions.

Implement all of the recommendations made by Vietnams Health Department to improve the health and safety conditions at Nike factories.

Implement all of the recommendations made by Ho Chi Minh Citys General Confederation of Labor, which include: classes on labor rights for workers, regular medical examination for workers, and establishing a pay scale that is fair and abides by Vietnamese labor law.

In his concluding thoughts, Young noted: "It is an awesome accomplishment to build a global business and brand as NIKE has done, but it is an equally tremendous responsibility to employ (albeit indirectly) almost half a million people and to know that these people and their families are ultimately dependent on NIKE for fair treatment, fair compensation and some measure of dignity and self-respect in the workplace."

But as his own report would seem to indicate, Nike has no intention of acting in the interest of this responsibility. As VLW's Thuyen Nguyen noted, "labor practices of the 19th century should no longer be tolerated at the end of the 20th century, especially by a U.S. corporation that claims the moral high ground, projects a progressive image, and is extremely wealthy." It's time for Nike to "Just Do It" right -- launch a real investigation into the conditions in their overseas operations and take more than a shallow PR approach to making workers' quality of life as much a priority as the quality of their brand.