Nikkei CARS Analysis BY tastes CARS Analysis and Impact on Operations Nikkei has a Code of Business Conduct and Ethics that includes its commitment to the environment and is a signatory of the UN Global Compact.
Nikkei has created a team of sustainability managers led by an independent director. Its environmental goals include producing ‘CEO-friendly’ products and minimizing its environmental impact through the reduction of greenhouse gases, organic solvents and PVC.Nikkei acknowledges the difficulty of tracking environmental emissions and the use of trials in supply factories, and is currently exploring new ways to best respond to these difficulties and enforce environmental compliance. All major material suppliers are audited with a focus on reducing chemicals. Facility initiatives include recycling and energy efficiency, reducing water usage and monitoring corporate travel.
In 2005, Nikkei began collecting baseline data on more than 650 contract factories in 52 countries, conducting 65 audits, and 15 in-depth root cause assessments.The results told showed that the greatest Environmental, Safety and Health (SSH) issues are in pacific factory types (footwear, vertical apparel and inflatable facilities which make products such as basketballs, volleyballs and soccer balls) and the majority of those contract factories are in 10 countries: Bangladesh, Brazil, China, Honduras, India, Indonesia, Mexico, Thailand, Turkey and Vietnam. Nikkei then used factory type and country filters to focus its SSH efforts on about 70 contract factories that employ about half of the contract factory workers around the world.Chemical exposure, worker protection, fire safety, and maintenance related safety are the most significant SSH issues in contract factories. To that end, the company is working to improve worker health in contract factories through auditing and analysis, training and factory capacity building, integrating factory management systems, and reducing solvents. Additionally, with increasing pressure on the company to reduce its greenhouse gas emissions, the company is looking to offset emissions from the extensive amount of business travel undertaken.New products are also being developed that are more CEO-friendly.
For instance, the company has begun to offer n organics line, and is integrating small amounts of organic cotton into all apparel items, with a target of at least 5% organic cotton in every piece of cotton apparel by 21 10. Nine’s life cycle analysis program is designed to phase out the use of materials and chemicals that are harmful to human and/or environmental systems. Products such as the Dir-FlT Stand-off Singlet, SD 400 Slide Sandal, and the Air Essential Ill incorporate both environmental sustainability and marketability.Nikkei is also developing a cleaner, less chemically-dependent rubber for eventual use on all athletic shoes. Another unique product in Nine’s recycling program is entitled ‘Nikkei Grind’.
Through this program Nikkei recycles used shoes to use in the fabrication of synthetic playing fields (football and soccer fields, basketball courts, running tracks, provide over 80 surfaces around the world, many of which are located in under- served communities. The program has been extended to include non-Nikkei branded athletic shoes.Nikkei has managed to eliminate 96% of the identified chemicals by weight in one particular type of rubber used in the shoe production process.
The many is also looking for ways to increase the amount of rubber it recycles. At the close of IFFY, Nikkei had more than 50 percent of footwear models containing some of the improved more sustainable rubber. Across the Nikkei brand, this change has allowed for the elimination of at least 3,000 metric tons of toxic materials every year. Nikkei discloses that an estimated 20 gallons of water are used for every pound of textile produced.Use of this water and its discharge is the largest environmental impact of textile production.
For these reasons, Nikkei directs vendors who supply to stories to comply with key criteria from its apparel water program. For IFFY-06, this program was based upon guidelines developed through a working group managed by Business for Social Responsibility. The company is also looking for ways to increase its use of green power in its operations worldwide, thus reducing the amounts of harmful emissions released into the atmosphere.In February 2007, Nikkei was recognized for its leadership in climate change by WFM -US. As a founding member of the Climate Savers Program, Nikkei attained its company-wide target, achieving annual CO emissions 13 percent below 998 levels by the end of 2005. The company appears to have few polices in place that directly address human rights, as most of its efforts have gone into labor rights. However, the company is a member of the Fair Labor Association (FLAG), a monitoring coalition of apparel and footwear companies, Nags, human and labor rights organizations established in 1996.
Its goal is to oversee the independent monitoring, with local Nags, of factories producing for member companies, with the results made publicly available. It is also beginning to formalize its process for stakeholder engagement and has been involved with over 100 external groups over the past several years including: Business for Social Responsibility, Global Alliance Workers and Communities and the Human Rights Committee of the American Chamber of Commerce. Nine’s Code of Business Conduct and Ethics includes its commitment to equal employment in a healthy and safe environment free of discrimination and harassment.Nikkei has appointed a Vice President of Global Diversity and Inclusion to lead efforts in support of Nine’s Diversity and Inclusion vision. Nine’s vision and mission for diversity includes a women and minority supplier program. The global women’s leadership council serves to support the career advancement of women within the company.
There are also six “Nikkei Networks” officially recognized and supported by Nikkei. These African American, Asian Pacific, disabled, gay/lesbian, Latino, and Native American support groups are internal communication and support forums for employees.Nikkei has a policy not to employ anyone under the age of 16 in the apparel sector, and anyone under 18 in footwear producing factories. The group policy is not necessarily reinforced in all operations. Internal monitoring efforts at Nikkei have shown that the falsification of age records does frequently occur.
Reprimands for factories found employing minors are severe, and in the most extreme cases, can be the cause of the termination of the contract. Nikkei states it is committed to socially responsible sourcing practices.All contractors/ suppliers who manufacture Nikkei product must adhere to its Code of Business Conduct and Ethics. This code calls for its partners’ management practices to respect the rights of all employees, to minimize the impact on the environment, provide a safe and healthy work place, and promote the health and well being of all employees. As a member of the Nikkei team, when presented the opportunity, all contractors/ suppliers have a responsibility to promote compliance with the NIKKEI Code of Conduct and to report any instances of non-compliance, of which they become aware, to the Corporate Responsibility Compliance Group.Despite the policies, procedures and corporate culture, Nikkei has been involved in severe and repeated criticisms from labor rights advocates, particularly on alleged unhealthy working conditions at its suppliers in Asia and South America.
Reports from labor unions and activist groups have uncovered cases where employees allegedly received low compensation, were exposed to sweatshop working conditions, and forced to work long hours.Nikkei has responded to these allegations and has examined and implemented new corporate responsibility programs and initiatives. However, the company continues to be charged with new allegations and claims of non-compliance. Nonetheless, the company’s strategy appears to be sufficient to avoid the risk of infringing international standards and can be considered as one of the best practices in the industry. In terms of overall corporate social responsibility, Nikkei made huge strides by coming involved with the Natural Step in 1997.The Natural Step is an international non-profit organization founded in Sweden that aims to orient society towards a sustainable future by establishing sustainability principles for corporations in all sectors. Nikkei drew on The Natural Step principles as a framework of key sustainability issues, and used their approach as a model for its sustainability strategy.
Between 1997 and 2000, Nikkei was slow to translate the sustainability policy and strategy into action, until it came under heavy attack from several activist groups.Nine’s strategy has evolved and become more holistic and in many ways the company is a highly innovative sustainable business leader. Nikkei also established a corporate responsibility division in 2001, became a CERES signatory in January 2001, and has conducted studies investigating the connection between wages and expenditures in eight countries (Vietnam, Mexico, El Salvador, China, Thailand, Dominican Republic, and the US). In 2004, a corporate responsibility (CRY) leadership team was established to set CRY policies and provide oversight across the company.