Byline: Rosemary Feitelberg / Arthur Friedman

NEW YORK — Dusty Kidd says he would like nothing better than to lose his job as Nike’s director of labor practices. But it doesn’t look like that’s going to happen any time soon.
Kidd is a busy man these days, defending the company against critics who challenge the working conditions and labor standards at Nike’s overseas production facilities.
Nike, the target of attacks by labor activists and human rights groups for allegedly exploiting factory workers in Third World countries like Vietnam and Indonesia, is on a mission to erase those images from consumers’ minds. The goal is to be proactive instead of reactionary, said Kidd, who plays the leading role in executing that strategy.
“My ultimate goal is to be out of a job,” he said. “I don’t want Nike to need a director of labor practices.”
During an hour-long interview here last week, Kidd — a former reporter for Fairchild Publications and head of its Tokyo bureau — said there are three questions about international production that are often on his mind:
“Do we meet basic standards in that country?”
“How do our factories compare to others in the business?”
“How do our factories compare with the way they were last year?” Nike, which was the first apparel company to join President Clinton’s anti-sweatshop task force in 1996, is anxious to get the apparel industry to agree on a code of standards for overseas production, Kidd said.
“There’s all this new territory. No one has tried to do this before,” he said. “There are always vexed parties outside the process. I say, ‘Join the party.”‘
Many apparel firms, including some of Nike’s competitors, are reluctant to join the task force because they have to expose their businesses to scrutiny and enforce the panel’s standards, Kidd said.
Charles Kernaghan, executive director of the National Labor Committee, a workers’ rights group, said Nike has taken some positive steps to improve working conditions and monitor labor standards at its contractors, but added, “I’m not ready to put them on any good-guy list.
“When the White House Task Force on sweatshops conditions was formed, it gave us something we never had before, which was a forum to discuss the issues of labor rights with the industry,” said Kernaghan, a member of the task force. “It was an enormous step forward and Nike deserves credit for joining it.”
Kernaghan said, from his perspective, Nike “still has too many problems it needs to seriously address.”
But Kidd said the entire industry has problems. He said the apparel industry needs to set up standards that consumers consider credible and voluntarily enforce them.
With a “multimillion-dollar budget” to enforce fair labor practices, Nike puts a mandatory cap on work hours and has revised its code of conduct. Kidd declined to be specific on the size of the budget.
There are three basic tenets the NLC wants to become standard practice before a company is deemed acceptable in its eyes:
Creating a “living wage,” which Kernaghan said means the wage needed for a subsistence standard of living for an individual in a particular country.
Agree to independent monitoring of contractors by human rights and religious groups to insure that a corporate code of conduct and local labor laws are being enforced.
Allow workers the right of free association and the ability to organize.
Nike provides work for 450,000 to 500,000 workers in 300 factories in 32 countries, including the U.S., said Kidd.
“We don’t like to be in 32 countries. It does make it more difficult to monitor effectively, but because of quota restrictions, we need to spread out our production,” Kidd said.
None of Nike’s workers receives complimentary apparel or footwear. Nike declined to say what percentage of them can afford to purchase Nike products in their respective countries.
In the U.S., there are 11,000 people working for Nike. About 45 percent of the Nike apparel sold in the U.S. is also made here, Kidd said. Nike, which also produces and distributes Cole Hahn footwear, is the fourth-largest footwear maker in the U.S.
Last week, Nike set up a site on the World Wide Web to post current information about the company’s efforts to improve working conditions overseas. The site address is
Kidd also cited preliminary results of a study of factory workers’ spending patterns in Vietnam and Indonesia by MBA candidates at Dartmouth College’s Amos Tuck School of Business, which were posted Monday on the Web site.
Researchers spent several weeks in both countries interviewing and polling Nike and non-Nike factory workers, sometimes in their homes. To determine spending patterns, researchers visited local food markets and reviewed studies conducted by the World Bank and nongovernment agencies.
In Vietnam, for example, workers at the Chang Shin factory earn an average of $56 each month, spend $29 for living expenses and have about $27 of discretionary monthly income, according to Kidd. The monthly minimum wage is $45 for the province where that factory is located.
All this is part of Nike’s plan to fend off critics, as the company attempts to enforce monitoring of its overseas factories.
“Monitoring is a huge job. Many people assume that it ought to be like it is in your backyard,” Kidd said. “Sometimes we represent 10 percent of a factory’s business. When we talk about health issues, safety matters and wages, we’re often told, ‘Forget it.’ And we do. We go somewhere else.”
Kidd pointed out that in addition to being the first apparel company to join the President’s council, Nike established its own code of conduct in 1992 and a monitoring program in 1994. Despite those efforts, Nike had some shortcomings, Kidd said reluctantly.
“This is not to say there were places were abuse has not occurred,” he said. “Every workplace in the world has problems. The question is, ‘How often do they occur and what happens when a worker is abused?’ “
But Nike’s in-your-face advertising and $9.1 billion business lend themselves to criticism, Kidd consented.
“We make a good target due to the nature of the way we talk and also our size,” he said. “In fairness, things have not been at their best levels.”
When Nike hired former UN Ambassador Andrew Young to survey factories in China, Indonesia and Vietnam, Kidd said, it never thought Young’s integrity would come under fire. But Nike was criticized because Young did not address wage issues and was paid by the company. Nike, said Kidd, was unfairly accused of “buying him [Young] off.” Kidd declined to disclose how much Young was paid other than to say it was less than an honorarium for a speech. Young generally receives $25,000 per speech, according to his spokeswoman.
Kernaghan was critical of Young’s monitoring attempt, calling it “extremely shallow.” He said just the fact that Young was paid by the company and that his trip to factories was announced in advance made it lack credibility, not to mention that he used an interpreter provided by the factory and that only working conditions and not wages were discussed in his report. “Until there’s some real movement in these regards to improve the rights of workers, Nike will continue to be a target of our campaigns,” Kernaghan said. “At least they’re on the task force and have shown some desire to talk about the issues. But their approach smacks too much of public relations and not enough of rolling up their sleeves.”
Kidd admitted Nike might have erred in using its own interpreters.
Those who suggest Nike chairman and chief executive officer Phil Knight, or Michael Jordan, should take a pay cut to support factory workers are misguided, since both create jobs, Kidd asserted.
Jordan, for example, is responsible for 30 percent of the jobs that Nike provides around the world, Kidd said. That figure, he added, is based on retail sales for Nike’s Jordan products and the excitement he creates for the brand.
Kernaghan does think Nike has the potential to become a “good-guy” company in the NLC’s eyes and he admitted, “Companies do need some space to facilitate change. We have to be careful not to set the hurdle too high.”

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