Case study

Analysis on Brand
Sustainability

Presented By:
DEBOPRIYA SAHA, KARISHMA RAJ, PRIYANKA KUMARI, RIDHI PRAKASH , RUCHI RATAN, SIMRAN SINGH
Nike
Nike, Inc was selected because they had accusations of child labor that led to protests against the company and today they
are a sustainability leader in innovation, design, and best brand for the environment. They are an industry leader in apparel
and sports brand, surpassing its competitor Adidas and ESPN in sales at a value of $29.6 billion (PledgeSports, 2017).

This is important as many companies believe they can not incorporate sustainability or a circular economy because
it is complicated to implement through the supply chain because they are so large.
 What went Wrong?
The ability for Nike, Inc to grow so rapidly during the 1970s was by outsourcing their labor overseas in countries with
the lowest wages and policies banned the formation of labor unions.

The exploitation of their factory workers included sweatshops that had child labor with abysmal working and living
conditions, verbal and physical abuse, forced overtime, and toxic emissions that harmed human and environmental health.
If workers tried to demand additional rights or benefits, Nike would close the location and move the factory elsewhere to
operate at the lowest cost possible (Wilsey, Lichtig).

In 1990s Nike was criticized in the media and by the community for selling apparel that was produced in sweatshops.

During this time, Life Magazine published an article with a child stitching together a ball with the Nike logo on the front
of the magazine to discuss the issues surrounding the corporation during this time. They attempted to spread awareness of
the living conditions of these industries as it was a relatively new claim during this decade.
 Transparency
Nike took an initial step to formally committing to sustainability by releasing the first Corporate Environmental Policy.

Nike created a code of conduct to manage its suppliers to ensure they are following strict regulations and rules to ensure no malpractice.

They conducted more than 600 factory audits over the next five years to assure the code of conducts were being demonstrated correctly.

They first demonstrated transparency by publishing a complete list of its contracted factories and releasing the first version of a Corporate Social
Responsibility (CSR) report each year with contracted suppliers and responding to crises fast and effectively.

After the deadly fire at Dhaka garment company that killed 112 factory workers, Nike decided to investigate their own suppliers in Bangladesh. Vice
president of global sourcing and manufacturing and the vice president of sustainable manufacturing and sourcing set out to the country to speak with
managers of the facility, people in the neighborhood, and the factory workers. They decided after their interaction and what had been discovered that it
was best to cut ties with one supplier due to their lack of compliance with the code of conduct.

In their first CSR report, they detailed their pay scales and working condition in their factories that many people of the community were questioning.
It also discussed the accusations and admitted fault in which they were working towards fixing, vital to ensure consumers can trust them.
 Waste Reduction
Nike utilizes a circular economy, or “cradle to cradle” cycle instead of a traditional economy, everything is reused and never wasted. With innovations in a sustainable
leather called FlyKnit, Nike uses the most recycled polyester than any other sportswear brand. In addition, 75% of all shoes and apparel from Nike contain at least some
recycled material Globally

NIKE FLYKNIT Nike created a breakthrough in footwear with Nike Flyknit. Flyknit is a revolutionary manufacturing method that enables designers to precisely micro-
engineer every stitch to create a featherweight, formfitting and virtually seamless upper while reducing manufacturing waste and the amount of materials used. Flyknit
technology has helped Nike reduce waste by nearly 2 million pounds.

Nike has diverted up to five billion plastic bottles from landfills since 2012 by their innovations in their football kits made with recycled plastic (Nike, Inc, 2018).

RECYCLED POLYESTER Nike incorporates recycled polyester made from recycled plastic bottles into high-performance apparel and footwear. Plastic bottles are
reclaimed and melted to produce new fabric, a process that reduces energy consumption by an estimated 30% compared to manufacturing virgin polyester. Since 2010,
Nike has diverted more than two billion bottles from landfills.

Nike Flyleather :This is made from at least 50% recycled leather fibre and has a smaller carbon footprint than traditional leather manufacturing. Flyleather also improves
cutting efficiency and creates less waste than traditional cut-and-sew methods for full-grain leather.
 Energy Savings
With partnerships with wind companies, Nike is able to set a goal of sourcing 100% renewable energy to their owned and
operated facilities in North America by next year.

Nike Air : soles degned since 1994 contain at least 50% recycled manufacturing waste and since 2008 have been made with
100% renewable energy at our Air MI facilities. We reuse more than 90% of the waste from materials used for our Air soles
to make new, innovative cushioning systems.

This proposed plan is the energy equivalence of powering about four-hundred thousand average American homes.
Hannah Jones, Chief Sustainability Officer and VP of the Innovation Accelerator for Nike. “Investing in renewable energy
is good for athletes, the planet and for business” .
 Conservation of Water
Nike has incorporated a carbon-based dyeing process called Nike ColorDry by partnering with a Dutch startup, DyeCoo
Textiles.

NIKE COLORDRY - Nike opened a water free dyeing facility in its supply chain featuring high-tech equipment that
eliminates the use of water and process chemicals from fabric dyeing. The new technology is a revolution in manufacturing
that uses recycled CO2 as a more sustainable alternative to the traditional water-intensive process.

Compared to traditional methods of dyeing, it reduces dying time by forty percent, energy use by around sixty percent,
and the factory’s footprint by twenty-five percent.

Previously, Nike’s contracted textile plants were using and wasting about three billion gallons of water a year, 325
million gallons at Nike alone.
 Findings
Nike, went through serious and major transformation to sustainability and a circular economy, focusing on restoring
waste to be put back into the life cycle, from the concerns of their consumers.

Nike was built on the business model of finding the lowest cost of labor possible that led to child labor and exploitation
to being #16 on Fortune’s Most Admired Companies list, first in Apparel with a commitment to improving environmental
impact by providing transparency and ensuring decent working conditions in its supply chain,

Nike, Inc has undoubtedly changed the public’s perception of their brand. They have become a sustainability leader in
corporate business and it is vital to analyze this case in the hopes of understanding the importance of transformation to
sustainability.
Conclusion
Nike, Inc has transformed its public image by incorporating sustainability into their business model and ultimately following what consumers
requested. First, they admitted their wrongs and promised to do right and published their yearly CSR, vital to transparency for consumers. Today,
more corporations are looking towards progressing sustainability as it reduces business costs and increases profits. However, the issue of
sustainability in corporations is a deeper situation dealing with many different factors that could prevent this. To solve this, it is best to look at one
of the largest corporations in the fashion industry that was able to change their entire supply chain to be environmentally-focused so other
corporations in the industry could initiate it into their business model, Nike, Inc.

They analyzed their issues and decided their first endeavors would be to solve issues in their social pillar in sustainable sourcing in manufacturing.

It is strictly essential for corporations to have sustainability leaders to take initiative within the company and be the face of change. The case study
of Nike, Inc shows the lack of representation at the beginning by Phil Knight, the CEO and this frustrated consumers and even his own executives.
If a corporation wants to transform, it must have sustainability leaders in the company to represent the brand to prevent consumers from thinking
that the brand is associated with bad press.
 Conclusion
If the corporation has solid ties to their suppliers with a strict code of conduct for manufacturers in their countries, these corporations could
discover new innovative ways to progress their sustainability for long-term economic success.

Partnering up with startups such as the contract between DyeCoo and Nike or the wind companies and Nike reap ultimate benefits. Since
sustainability is such a new field of research, most new innovations are startups from young entrepreneurs and engineers and corporations could
see the best success in this area for innovation. Partnering with a company is the best decision because the corporation would not have to make
their own new innovative way and can outsource their project.

Today, Nike is a favorite brand by millennials in part because of the comprehensive commitment to sustainability and transparency across their
supply chain. The public image of corporations has definitely changed over the last three decades as consumers are holding them more
responsible for their actions on humans and the environment. Sustainability has become a forefront of a business and this case study served as an
example of the possible backlash that can happen if a corporation denies of progressing their sustainability and the paramount modification that
can be achieved when a corporation advances towards sustainable development.