NIKE, INC.
STATEMENT ON
FORCED LABOR,
HUMAN
TRAFFICKING AND
MODERN SLAVERY
FOR FISCAL YEAR
2022
I. BACKGROUND
NIKE, Inc.’s (NIKE) commitment to serving athletes everywhere has taught us that equality
on the eld is a powerful catalyst to driving equality o the eld. NIKE supports human rights
as dened by the Universal Declaration of Human Rights, which recognizes that “all human
beings are born free and equal in dignity and rights”. We work to elevate human potential
through our products, partnerships and operations, something that cannot be accomplished
without a fundamental respect for human rights throughout NIKE’s operations. We expect the
same from our suppliers, and we focus on working with long-term, strategic suppliers that
demonstrate a commitment to engaging their workers, providing safe working conditions and
advancing environmental responsibility. This includes working to combat risks of forced labor.
This statement is being furnished pursuant to the UK Modern Slavery Act, the Australian
Modern Slavery Act and the California Transparency in Supply Chains Act. This statement
discusses NIKE’s global business practices to address forced labor. It encompasses NIKE, Inc.
and its consolidated subsidiaries because we take a global approach to forced labor, human
rights and compliance. However, not all of our consolidated subsidiaries are subject to the
UK Modern Slavery Act, the Australian Modern Slavery Act and the California Transparency in
Supply Chains Act.
As used in this statement, forced labor includes modern slavery, prison labor, indentured labor,
bonded labor, human tracking, or other similar conduct. For more information on NIKE’s
commitment to sustainability and human rights, please see our annual Impact Report.
II. NIKE OVERVIEW AND SUPPLY CHAIN
STRUCTURE
NIKE is the largest seller of athletic footwear and apparel in the world. We sell our products
through NIKE-owned retail stores and through digital platforms, to retail accounts and through
a mix of independent distributors, licensees and sales representatives in virtually all countries
around the world. Virtually all of our products are manufactured by independent contract
manufacturers. To learn more about NIKE, view our annual and quarterly reports on the NIKE
Investor site.
We are growing our business through long-term relationships with suppliers that are committed
to our strict standards of sustainability and human rights, product excellence and compliance
with local laws. Our sourcing strategy prioritizes and favors suppliers that show demonstrable
leadership in corporate responsibility and sustainability, seeking to move beyond minimum
standards. As part of our growth strategy, we seek suppliers who drive sustainable business
growth by minimizing their environmental impacts, fostering a strong culture of safety and
developing an engaged and valued workforce.
NIKE discloses the independent factories and material suppliers used to manufacture NIKE
products in an interactive map that can be found on the NIKE Manufacturing Map.
NIKE’s commitment to ethical practices in our own operations and our supply chain
begins at the highest level – from our CEO and Board of Directors. NIKE, Inc.’s Corporate
Responsibility, Sustainability & Governance Committee of the Board of Directors reviews and
evaluates the Company’s signicant strategies, activities, policies, investments and programs
regarding corporate purpose, including corporate responsibility, sustainability, human rights,
global community and social impact, and diversity and inclusion; and provides oversight of
management’s eorts to ensure that the Company’s dedication to sustainability (including
environmental sustainability and human rights) is reected in its business operations. NIKE’s
executive leadership team reviews and conrms all company-wide sustainability policies and
targets, reviews performance toward targets, receives updates on key issues and emerging
trends, and provides oversight for eorts to improve.
More information can be found under Governance on the NIKE Purpose site.
III. NIKE’S CODE OF CONDUCT & STANDARDS TO
ADDRESS FORCED LABOR
NIKE takes seriously and fully supports national and international eorts to end forced labor,
human tracking and modern slavery. NIKE’s requirements for suppliers are contained in our
Code of Conduct and Code Leadership Standards. The Code of Conduct lays out the required
minimum standards we expect each supplier factory or facility to meet in producing NIKE
products and includes strict requirements around forced and child labor, excessive overtime,
compensation, and freedom of association amongst other requirements. The Code Leadership
Standards specify how the Code of Conduct should be implemented. This document also
articulates how we measure factories’ compliance eorts and progress against our Code of
Conduct, including specic requirements on the management of key forced labor risks.
We have progressively raised expectations for our contract factories through evolving the
standards within our Code of Conduct and Code Leadership Standards. NIKE Code of
Conduct and Code Leadership Standards include specic requirements to address key
risks of forced labor. NIKE regularly reviews and updates the NIKE Code of Conduct and
Code Leadership Standards. Most recent updates included broadening the denitions of
employment fees to be borne by suppliers and strengthening the oversight requirements for
labor agents recruiting and hiring foreign migrant workers.
IV. DIRECT SUPPLIERS’ CERTIFICATION OF
MATERIALS
NIKE requires its nished goods suppliers to verify they are sourcing materials from vendors
that are compliant with NIKE’s Restricted Substances List (RSL) and NIKE’s Code of Conduct.
NIKE’s Supply Agreements also explicitly require suppliers to comply with all local and
country-specic labor laws and NIKE’s Code of Conduct and Code Leadership Standards.
V. DUE DILIGENCE, RISK ASSESSMENT &
MONITORING
Leveraging information from external sources and supplier specic risks through NIKE’s own
programs, we continually evaluate and update our systems to identify and address risks in our
supply chain, including those related to forced labor. NIKE is working towards mapping these
risks further up the supply chain and is expanding engagement with Tier 2 suppliers. Over the
past few years, we have prioritized our work on forced labor risks in our supply chain to focus
on suppliers employing foreign migrant workers.
NIKE uses the CUMULUS Forced Labor Screen™, a due diligence tool to help identify risks
related to the recruitment of foreign migrant workers by NIKE suppliers. We have expanded
use of the tool to all Tier 1 nished goods and strategic Tier 2 suppliers hiring foreign
workers. In FY22, a new feature was added for verication of recruitment fee payment and
reimbursement. This work aims to help us understand current recruitment practices more
deeply and allows us to map overlaps in recruitment agents at both the facility and country
level. This process helps NIKE to identify risks and opportunities to further support our
suppliers and their recruiting agents in implementing best practices and serves as an ongoing
tool to monitor the eectiveness of programs in addressing and minimizing risks related to
forced labor.
We regularly audit contract factories, which are monitored on a schedule based on their
performance. These assessments take the form of audit visits, both announced and
unannounced, to measure against the NIKE Code of Conduct, Code Leadership Standards
and local law. NIKE audits assess the risks of forced labor, including the employment of
vulnerable worker groups such as foreign migrants, interns and temporary workers and high-
risk practices such as payment of recruitment fees and restrictions on freedom of movement.
More information on NIKE’s audit program can be found in the NIKE Impact Report.
NIKE uses both internal and external third-party audits to assess compliance with our
requirements and local law. We also monitor conditions at supplier facilities through audits
and assessments by independent organizations, including the Fair Labor Association and
the Better Work Programme, a joint project of the International Labour Organization (ILO) and
International Finance Corporation (IFC). In FY20, we expanded monitoring into our materials
supply chain and logistics providers.
In FY22, NIKE also expanded our partnership with Issara Institute by launching their Foreign
Migrant Workers assessment survey in a factory in Thailand. This survey assesses gaps in the
foreign migrant worker recruitment process, implementation of the ‘Employer Pays Principle’
and working conditions provided to the workers. In FY23, we plan to expand the survey to
other Thailand facilities employing foreign migrant workers.
VI. REMEDIATION AND EFFECTIVENESS
Working with a wide range of organizations and experts, NIKE continuously seeks to improve
our approach to evaluating working conditions in our supply chain and working with our
suppliers to enhance their capabilities. NIKE works with internal, external, and independent
monitoring organizations to carry out audits and help in remediation and capability-building
eorts. If we are provided evidence of an issue of non-compliance within one of our contract
factories, we investigate it promptly. Where improvements are required, we seek to drive
ownership by factory or facility management to identify and correct issues, and also improve
systems to address root causes in order to prevent future reoccurrences.
Through our ongoing assessment process, NIKE engages supplier groups to evaluate
programs designed to ensure foreign migrant workers do not pay fees related to their
employment, which is a violation of NIKE policy outlined in our Code of Conduct and Code
Leadership Standards. When alerted to violations to the NIKE policy by external parties, we
investigate and where applicable, collaborate with applicable stakeholders to drive remediation
of the issues with the facility, including reimbursement of fees paid by workers found to be in
violation of NIKE’s Employer Pays Principle.
VII. TRAINING AND ACCOUNTABILITY
NIKE believes suppliers that prioritize the well-being of their workers, by engaging with them
to understand their needs, have better factory performance. We also believe that our ability to
inuence suppliers is dependent, in part, on how we build the right incentives and sanctions
into our business relationships. Our Manufacturing Index, introduced in 2012, scores factories
on sustainability, including labor practices, on a par with traditional metrics of cost, quality and
on-time delivery.
To more fully integrate our compliance and sustainability criteria into sourcing decisions, NIKE
provides annual training to those with direct responsibility for supply chain management. The
training advances enhanced understanding and compliance with our sustainability policies,
our Code of Conduct and Code Leadership Standards, that include our expectations on
ethical recruitment. The training curriculum includes a specic highlight on our requirements to
prevent risks of forced labor.
NIKE frequently convenes supplier events, or learning communities, designed to share
information on NIKE expectations, developments on local policies/legislation, and other
sustainability and labor best practices, including those related to management of migrant
workers, a challenge that is faced by many of our suppliers and vendors in countries where
it is common to recruit workers cross-border. For example, in FY22 we collaborated with
Issara Institute to deliver a training session for factories in Thailand on the current challenges
for foreign migrant worker visa renewal during the pandemic. This training helps provide
additional guidance for suppliers faced with the decision of sending workers back to Myanmar,
a situation that puts workers at risk, or continuing to employ them, putting the supplier at legal
risk.
NIKE is also partnering with the Responsible Labor Initiative (RLI) to deliver the Responsible
Recruitment Due Diligence Toolkit training for all strategic Tier 2 suppliers in Taiwan. In FY22,
6-month post-training coaching and consultation program for these suppliers was completed.
Post-training coaching and consultation provides direct support from RLI to identify gaps in
recruitment systems, develop sustainable improvements plans and to prioritize these plans for
implementation.
VIII. COLLABORATIVE SOLUTIONS
NIKE believes addressing critical human rights risks, such as forced labor, often requires a
collective approach. We engage with multi-stakeholder working groups to assess collective
solutions that will help preserve the integrity of our global supply chains. NIKE has long
partnered with multi-stakeholder and external organizations such as the Fair Labor Association
and the International Labour Organization’s Better Work Programme to address labor risks in
our supply chain. We are also signatories to the Responsible Sourcing Network’s Turkmenistan
Cotton Pledge and Uzbekistan Cotton Pledge. Through our partnerships with these and other
organizations, we work on a wide range of human rights risks, including those related to forced
labor.
NIKE is a founding signatory to the American Apparel and Footwear Association & Fair Labor
Association’s Apparel & Footwear Commitment on Responsible Recruitment. The principles
of the Commitment, centered on addressing risks for forced labor, are aligned with NIKE’s
standards and the work we have been doing with our supply chain manufacturers for more
than a decade. We believe this builds on the focus by several other sectors to drive change
in the dynamics of how workers are recruited, including for cross-border employment. NIKE
is also a member of the Leadership Group for Responsible Recruitment (LGRR), an initiative
of the Institute for Human Rights and Business and is a member of the Responsible Labor
Initiative (RLI), an initiative of the Responsible Business Alliance to further our work and goals
on eliminating forced labor risks in our supply chain. Each organization helps us to advance
core aspects of our strategy.
NIKE works collaboratively with a number of non-governmental organizations to address
forced labor. NIKE has a strategic partnership with Issara Institute in Thailand. All NIKE Tier 1
and Tier 2 suppliers operating in Thailand that employ foreign migrant workers will have access
to the program enabling on-site support, expert consultation and on-going engagement
with workers and factory management. At the core of the program is worker voice, where
both foreign and local workers can provide feedback or concerns through multiple channels
managed by Issara. This work focuses on building trust with workers to self-identify gaps
and empowers suppliers to strengthen Human Resource systems to address issues, with
a focus on issues impacting foreign workers. Issara works with the suppliers in sharing
worker’s concerns anonymously, providing support and follow-up throughout the supplier’s
improvement progress. Upon addressing the concerns, Issara will update related worker
directly and gather any additional feedback.
We continue to collaborate with industry experts, partners, industry associations, stakeholders
and other organizations to understand, evaluate and address matters related to forced labor.
We also continue to expand and evolve our work with other industry peers, NGOs, and
organizations to increase respect for human rights and to accelerate positive impact in the
countries where we and our suppliers operate. For more information about our work, please
see the Responsible Sourcing section of our Purpose website.
This statement covers the period from June 1, 2021 to May 31, 2022.
The following NIKE, Inc. subsidiaries are required to publish a statement under the UK Modern
Slavery Act: NIKE (UK) Limited and NIKE Retail B.V. This statement was approved by the
Boards of Directors of those entities on November 29th, 2022 and signed by the undersigned,
a director of those entities, on November 29th, 2022.
Milou Meijer, Director
Nike Australia Pty Ltd (Nike Australia), a subsidiary of NIKE, Inc., is required to submit a
statement pursuant to the Australian Modern Slavery Act. Nike Australia has its headquarters
in Melbourne and distributes, sells and markets NIKE athletic footwear and apparel. Nike
Australia operates retail outlets in Australia and sells on wholesale basis in Australia and in the
Pacic Islands. Nike Australia has approximately 600 employees engaged in administrative
functions and retail sales. It does not engage in manufacturing and its supply chains are
managed as part of NIKE’s global sourcing and manufacturing process. Accordingly, the
policies and procedures described earlier in this statement apply on a global basis unless
otherwise indicated, including to Nike Australia. Nike Australia does not own or control any
other entities. This statement was approved by the Board of Directors of NIKE Australia on
[insert date] and the undersigned, who is a member of that Board, has been authorized to sign
this statement.
Mary I. Hunter, Director, NIKE Australia Pty. Ltd.
