As companies across the country have renewed their commitments to diversity, sustainability and other values that consumers are seeking more than ever, Nike has charted its five-year plan in its latest impact report.
The extensive report trumpeted 29 targets for 2025 that are focused on people, planet and play. However simplistic that might sound, they delve into more complex matters like diversity, inclusion, social justice, pay equity, sustainability and advancement.
Entitled “Breaking Barriers,” the 125-page FY20 Impact Report is significantly larger than the 85-page one for fiscal year 2019. The timing of the release of the 137-page report by a Nike spokeswoman at 7:30 p.m. EST on Wednesday is worth noting. Nike’s extensive run-through also landed hours after Adidas released its most recent annual earnings and mapped out its own ambitious five-year business plan that includes emphasizing sustainability and being more female-focused.
Last summer, Nike, like rival brands Adidas and Reebok, faced criticism from some employees for the lack of racial equality within their organizations. An anonymous “Black at Nike” Instagram page highlighted allegations of racism and inequality at the company by unnamed contributors, who were said to be current or former Nike employees. After a brief period, the account disappeared as mysteriously as it had first surfaced.
But the company noted its reporting tradition since 2001, and how it expects to continue to report annual progress toward social and environmental targets and priority issues. Such self-imposed accountability has been gaining ground with other companies, following the nationwide call for social justice and racial equality last summer. In addition, heightened concern about climate change and environmentalism among millions of consumers has many companies and conglomerates reconsidering their manufacturing, supply chains, energy consumption, emissions and other business practices.
Nike’s report recapped its performance over the past five years and offered multiple targets through 2025. Some of the 2020 highlights include women comprising 49.5 percent of the workforce across the company. At the vice president level domestically, racial and ethnic minorities increased eight percentage points in 2020 to 29 percent. Nike reported investing $89.8 million in community impact.
Following the social justice movement that started last summer after the police killing of George Floyd in Minneapolis, Nike and scores of other international companies and conglomerates stepped up to improve diversity within their ranks and in the communities that they serve. Nike, Converse, the Jordan Brand and former NBA star Michael Jordan have committed a combined $140 million over 10 years to support organizations that foster economic empowerment, education, social justice and racial equality for Black Americans. That contribution, which was revealed last summer, is highlighted in the report.
As part of its ongoing efforts to bolster diversity and try to meet 2025 targets, Nike plans to cumulatively spend $1 billion on diverse suppliers. The company defines a diverse supplier as one that is owned, operated, managed and controlled by a person or persons who is are U.S. citizens or lawful permanent residents. A diverse person may be a minority, woman, disabled individual, LGBQT and/or veteran, according to Nike. Looking back, the company changed its diversity and inclusion structure last year so that talent and diversity and inclusion are under one leader. Talent refers to every aspect of the entire employee experience, according to the company.
The 2025 goals include having the sneaker giant invest $125 million to support organizations “working to level the playing field and addressing racial inequality.” Nike has pledged to invest 2 percent of prior year’s pre-tax income to try to have a positive impact in communities annually.
In a letter at the start of the just-released report, Nike Inc. president and chief executive officer John Donahoe acknowledged how society continues to reckon with systematic racial injustice and how the company is committed to standing up for equality, which is one of its “core values.” He wrote, “Our brand would not be what it is today without the powerful contributions of Black athletes and Black culture.”
Interestingly, that point is one that consumers reminded the sneaker company of last summer via social media. Similar complaints were also directed at its competitors like Adidas. in his letter at the start of the report, Donahoe noted the aforementioned $140 million combined donation. The executive also referenced being focused on building a diverse, inclusive team.
Donahoe noted how for the first time, Nike will tie executive compensation to “Nike’s progress in deepening diversity and inclusion, protecting the planet, and advancing ethical manufacturing,” he wrote. “Our goal is, and always will be, for Nike’s people and purpose to come together for good.”
Looking ahead to 2025, the Beaverton, Ore.-based company has a laundry list of goals. Having women represent 50 percent of its global corporate work force — full-time employees, who do not work at the company’s retail stores, distribution centers or Nike Air manufacturing — is a 2025 target. Having women in 45 percent of leadership positions is another. That would apply to vice president positions and above. Nike also aims to have racial and ethnic minorities comprise 35 percent of its U.S. corporate workforce by 2025. But should that percentage be reached, that would represent only a 6 percent gain compared to the current base of 29 percent. The company is striving to have all of the women in its supply chain have increased access to career opportunities.
In terms of green-minded practices, Nike reduced textile dyeing and finishing supplier freshwater use per kilogram of material by 30 percent — exceeding a fiscal year 2020 goal. The company touted how it is using 100 percent renewable energy in the U.S. and in Canada for its owned and operated sites. And globally Nike was powered by 48 percent renewable energy for fiscal year 2020.
By 2025, Nike hopes to have a 70 percent reduction in GHG emissions in its owned or operated facilities. The plan is to have 10 times the amount of finished product waste refurbished, recycled or donated.