Nike Shareholders Reject Proposal on Workers’ Rights

In a significant development at Nike’s annual meeting, shareholders have voted against a proposal that aimed to address human rights issues in the company’s supply chain. The proposal, which was put forward by a group of investors, urged Nike to consider joining binding agreements with supply chain workers in high-risk countries.

The proposal was initiated by an investor group led by Domini Impact Equity Fund, which called for Nike to assess the effectiveness of its supply chain management infrastructure in ensuring alignment with the company’s equity goals and human rights commitments. The initiative also sought to address allegations of $2.2 million in unpaid wages and benefits owed to garment workers at Nike suppliers in Cambodia and Thailand.

Nike’s board of directors had recommended shareholders vote against the proposal, stating that the company has “implemented strong processes and practices to identify, evaluate, and rectify human rights and labor issues across its operations and supply chain”. The company maintained that its current policies and disclosures effectively communicate its commitment to human rights and sustainable sourcing, making the proposal unnecessary.

This decision comes at a time when Nike is facing increased scrutiny over its handling of worker rights within its supply chain. The Clean Clothes Campaign, a worker rights advocacy group, has warned about potential long-term damage to Nike’s reputation due to its perceived lack of engagement with shareholders on these issues.

The vote took place against the backdrop of Nike’s recent financial performance. For the fiscal year, Nike, Inc. reported revenues of $51.4 billion, a slight increase from $51.2 billion the previous year, marking a 1% rise on a currency-neutral basis.

As this is an ongoing story, the full implications of this shareholder decision on Nike’s future policies and practices regarding supply chain worker rights remain to be seen.

Sources:
[1] https://www.marketscreener.com/quote/stock/NIKE-INC-13739/news/Nike-shareholders-vote-against-proposal-on-workers-rights-47842028/
[2] https://seekingalpha.com/news/4148520-nike-shareholders-reportedly-block-proposal-remediate-human-rights-issues
[3] https://finance.yahoo.com/news/explainer-costly-nike-silence-supply-101520482.html
[4] https://www.reuters.com/business/retail-consumer/nike-shareholders-vote-against-proposal-workers-rights-2024-09-10/
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[8] https://www.reuters.com/world/europe/norway-wealth-fund-vote-against-nike-shareholder-proposal-evaluating-human-2024-09-05/