Our Sustainability Strategy

Introduction

The game has changed, forever.
Sustainability used to be the exclusive domain of experts, activists and idealists. Then, it moved into a silo at the outskirts of the corporate landscape. Today, it is seen as an important, wellintegrated part of any forward-thinking company – as one of the key drivers of success. At NIKE, Inc., we are exploring new sustainable business models to prepare us for a fundamentally different operating environment. To do this, we must deftly navigate a quickly changing landscape. We see a future in which:

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Competition for scarce natural resources affects the cost and availability of the inputs needed to make our products, and in turn, the price and availability of the products themselves Rising energy costs and greenhouse gas emissions lead to increasing pressure on traditional models of product manufacturing and transportation Persistent global disparity in access to financial and other opportunities influence workers throughout our supply chain Continued urbanization and the growing middle classes create new demands for products and services, and new opportunities to meet them Emerging regulations related to materials use, labor practices and other issues continue to shape our business environment

Our vision is to build a sustainable business and create value for Nike and our stakeholders by decoupling profitable growth from constrained resources.
This is not just key to our sustainability strategy. It’s part of our business strategy – and it guides us as we move forward. This report covers our performance during FY10/11, the time during which we developed and refined this vision. Much of our progress and what we learned during this period laid the foundation for how we’re moving ahead to make the vision a reality. This vision has been built on years of assessing trends and materiality for Nike and the changes that are impacting our business, our value chain, our consumers and the world. In 2007, we undertook an assessment (along with SustainAbility, a consulting firm) of some meta trends that have only become more relevant as we’ve shaped and defined our strategy (see findings on the next page). These meta trends highlight the areas of our value chain and our business that have the most potential for innovation. We use these filters in our work, our assessment of opportunity and the way we approach reporting.

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Sustainable Innovation .

We consider potential environmental and social impacts. particularly as it relates to sustainability. This group is chaired by our CEO and oversees our innovation pipeline and portfolio. our ability to bring the innovation to scale. we believe leveraging innovation in sustainability can be a vehicle for growth and will help us accelerate our vision for superior performance and minimum impact products. new business models. new relationships and new ways of thinking. more equitable and empowered. and innovation lies at the heart of that process. As we continue to successfully innovate across our entire value chain. we hope to go much further. which reduces waste in knitting together the upper of the shoe. In 2011. We launched our Lab as a business development and strategic partnership team within Nike that helps us drive innovation and collaboration. Recommendations that come from the Lab. as with any other area of the Nike business. The world needs new systems. possible revenue. Sustainability requires transformation. . greener. helping our supply chain become leaner. Through other initiatives. on their own they will fall far short of achieving the progress that’s needed. and other factors. are reviewed by management for alignment with our strategic and financial goals. savings and risk reductions. from evolutionary enhancements to disruptive shifts that can transform the industry. For example. Retrofitting and fine-tuning the approaches of the past will simply not solve the problems we face. so we prioritize our initiatives and investments. we launched an executive-level Committee for Sustainable Innovation. We then manage projects throughout our innovation pipeline from the kernel of an idea to its mass adoption (see graphic). One example is employing fundamentally different processes to make products. Although incremental improvements play an important role. Another is exploring new materials and manufacturing processes through our Sustainable Business & Innovation Lab. like Nike Flyknit’s innovative manufacturing process. and we have built tools such as the Nike Materials Sustainability Index (Nike MSI) to make it easy for designers to create products with lower environmental impacts. Opportunities for innovation are countless. We are maintaining a relentless focus on sustainable innovation. sustainability will be an engine for growth. we created jerseys for the 2010 World Cup that were made from recycled plastic bottles.Sustainability is the world’s greatest innovation challenge. The Lab is an expression of our culture and commitment to collaboration and innovation. It helps to fully capitalize on opportunities by accelerating adoption and bringing these activities to scale.

See more at: http://www. These pillars do not stand alone – they are interconnected. The work we do today to optimize and deliver positive impacts also drives insights into disruptive innovations that will create our future.91PqrTqw.nikeresponsibility.dpuf .Our Sustainability Pillars We drive sustainable innovation throughout our company across four strategic pillars (see above).com/report/content/chapter/our-sustainabilitystrategy#sthash. .