'M' Goes Swoosh! U-M's "Great Fit" With Nike
4-Agenda- March 1997
COVER STORY
'M' Goes Swoosh! U-M's "Great Fit" with Nike
By Michael Betzold Special to Agenda
Since 1994, the University of Michigan's athletes have served as walking billboards for Nike, the giant shoe Corporation. Nike's familiar swoosh logo appears on uniforms and shoes worn by U-M athletes in 23 sports. Coaches, staff and team members must wear Nike products at every game, practice and clinic.
"It's a great fit," says U-M's Fritz Seyferth, senior associate athletic director for financial operations. "Nike's been a great partner."
Nike's in-your-face "Just Do It" slogan suggests rebellion. One Nike ad advises: "Try something you've never tried. Risk it ... Demand a raise."
When 24 Nike workers in Indonesia followed this advice, they were fired. They organized a 1993 strike of 6,000 workers at a factory near Jakarta to protest wages that were below the government poverty level. They still don't have their jobs back. "Just Do It" banners in Nike's Asian factories don't suggest freedom. Workers think the slogan means: "Don't talk, work harder."
Cicih Sukaesih, one of the fired strike leaders, remembers gluing soles on Nike shoes while packed tight with other women in oppressive heat. The women used flammable glues and solvents near open flames of welders. Workers had one bathroom break a day. Out of their pay, the company deducted money for lunch, insurance and a color-coded Nike T-shirt all workers had to buy and wear.
It took five years of strikes and press criticism before Nike paid its Indonesian workers the minimum wage. Now the workers there, mostly young women, earn a basic wage of about $2.20 a day.
A pair of running shoes that retails for $75 costs Nike $18.25 to assemble and ship to the United States, Business Week reported last year. Nike says labor accounts for $2.60 of the cost of a pair of shoes.
This year, U-M athletes, coaches and staff are wearing 1,615 Nike shoes, all made with what critics call sweatshop labor. All were tax-deductible donations from Nike.
Last year, Nike made 70 million pairs of shoes in 12 Indonesian plants run mostly by militaristic Taiwanese and South Korean subcontractors. In Indonesia, only the government-controlled union is legal and military pólice enforce discipline in factories. Labor activists are harassed. The head of the independent Indonesia Labour Welfare Union, Muchtar Pakpahan, is currently on trial, charged with subversión, a capital crime.
Most of Nike's shoes come from countries where forming an independent trade union is illegal. six percent are made in Indonesia, 30 percent in China, and 15 percent in Vietnam. All three nations have miserable human rights records. The remaining shoes are made in Thailand, the Philippines, Korea and Taiwan . Other items of apparel are made in 35 countries worldwide.
Nike officials are quick to blame authorities for conditions in their factories. "We're dealing with governments that are less than ideal," Nike CEO and co-founder Philip Knight told Business Week last year. As a Harvard undergraduate in the early 1960s, Knight wrote a paper on the profit potential of making shoes in Asia. Now his stock options are worth $4.5 billion.His global labor force of 200,000 semi-skilled factory workers and 15,000 professionals collectively earns aboul $1 billion, less than a quarter of Knight's holdings.
Profiting from cheap labor, high mark-ups and the endorsements of superstars like Michael Jordan (paid $20 million a year by Nike), Andre Agassi (10 years for $190 million) and filmmaker Spike Lee, Nike sales topped $6 billion in 1996 and Nike surpassed Adidas as the world's top sports apparel maker.
Each year, Nike pays U-M $200,000 in "base compensation" to replace an old contract it had with ex-football coach Gary Moeller. Cicih Susaesih would have to stitch Nike shoes for 246 years to make that much money.
Full-Court Press
Like Joe Dumars covering Air Jordan, bad press was all over Nike in 1996:
In Life, prize-winning journalist Sydney Schanberg ("The Killing Fields") reported on children in Pakistan who stitched soccer balls for 60 cents a day for manufacturers including Nike. Pakistan produces 80 percent of the world's soccer balls. They sell for $6 in Pakistan and $30/$50 in the United States, even though most enter this country tariff-free.
A New York Times article profiled Tongris Situmorang, an Indonesian fired for leading Nike coworkers on a strike to push for better pay and food. He was locked in a room at the plant and interrogated by military police for seven days. Describing a Nike factory in Serang, Indonesia, Business Week reported: "Overtime is mandatory. Workers say exhausted colleagues regularly faint from overwork. ... A supervisor who skipped work one Sunday to care for his sick wife and child was forced to clean toilets and then was demoted. Another worker had to run laps around the factory because shoes she assembled had defects."
The Washington Post described a Taiwanese-run plant in rural China where 40,000 workers make Nike, Adidas, Reebok, Puma and other shoes. The militaristic plant requires new hires to take three days of training, including marching drills. Most workers pull 12-hour shifts for slightly more than minimum wage. The worker average of 80 hours overtime a month is more than twice that allowed under China's labor laws. It includes an unpaid hour a day in preparation and unpaid extra time at the end of the day for workers who don't finish their day's allotted tasks. Those late reporting to work are fined half a day's wage.
Factories making Nike shoes were cited in the State Department's Human Rights Report to Congress. Thirty-one Nike workers were fired in a strike and protests at a plant in Nikomas, Indonesia. A CBS-TV "48 Hours" segment documented corporal punishment of Nike workers in Vietnam. Workers said they were hit in the head with shoes, had their mouths taped shut and were forced to kneel with hands in the air. A manager at a Nike plant in Indonesia, convicted of beating 15 young women workers, told the court: "It's no big deal. It's just a method of managing workers."
Nike: "Workers in developing nations are not being robbed when the company gives a lucrative endorsement contract to the world's greatest basketball player. Just the opposite: Michael Jordan increases the demand for the goods these workers produce, creating upward pressure on wages."
Foul Trouble
"We treat our employees with dignity and respect," says Jim Small, a Nike spokesman. That's the sage the company's public relations machine has been conveying in recent months.
Last June, Nike sent a letter to presidents of universities under contract with the company , assuring them that Nike complies "with applicable government regulations regarding minimum wage and overtime, as well as occupational health and safety, environmental regulations, worker insurance and equal opportunity visions."
In the letter, Nike admitted using child labor to produce 40,000 soccer balls in Pakistan, but noted "the use of child labor in Pakistan is an epidemie in every industry" and complained that "we find it ironic that a practice that is centuries-old has all of a sudden hit the headlines when Nike enters the scene.
Nike told the colleges that if abuses of workers by its subcontractors are discovered, the company prefers to "work with contractors to correct the situation, rather than to throw workers into worse economic conditions by pulling orders out of the facility."
Last summer and fall, Nike sent representatives to campuses including U-M's. Small said Nike initiated the meetings "as a pro-active opportunity to get to them before they started to ask questions. There was a lot of misinformation in the media. We wanted to try to make sure they had the truth. These are important relationships for us."
U-M's Fritz Seyferth said Nike made "a presentation demonstrating their commitment to fair play" and it satisfied any possible concerns of university officials.
Nike had reason to worry that controversy might erupt, given several flaps in the last year:
In Portland, Oregon, a school board member and the city's Human Rights Commission urged the school system not to accept Nike's gift of $300,000 in cash and $200,000 in athletic goods. The deal was approved despite the protests.
In Edmonton, Alberta, labor unions and community groups have held up a proposed Nike sponsorship of a street hockey program for inner city kids.
In Eugene, Oregon, critics of Nike protested the University of Oregon's decision to accept $25 million from Nike CEO Knight to help build a law school.
In Madison, Wisconsin, controversy marred the University of Wisconsin's five-year, $9.1 million agreement with Reebok, a Nike competitor. Seventy faculty members and 200 students signed a petition objecting to the deal. A clause in which the university agreed to "take all reasonable steps necessary to address any remark by any university employee" that "disparages" Reebok was dropped, and regents approved the deal by a 12-4 vote.
In Ann Arbor, however, there has been no public criticism of U-M's deal with Nike.
"It's not an issue," Seyferth said.
"Shoe Me The Money!"
Shoe companies started invading college sports in 1978 when Sonny Vaccaro, a Nike representative, signed up UNLV's basketball coach Jerry Tarkanian for $2,500 and some sneakers.
"My theory was then, and it is now, that the person that controls the university is the basketball coach," Vaccaro told reporters last year. "The team will wear what he wants them to wear, so you pay him and you give free shoes to the school and it's a win-win situation."
By the 1990s, most coaches at top universities were making more money from their shoe contracts than they were from their employers. Georgetown's John Thompson, a member of Nike's board of directors since 1991, pulls down a $350,000 annual consulting fee from Nike and owns more than $2 million in Nike stock options.
The man who started it all, Vaccaro, now works for Adidas. He told the Associated Press last year: "The whole system is wrong. It's so wrong I would get out of it entirely.
... There's only one trouble. Nike would own everything."
U-M's Seyferth said Bo Schembechler was one of the last major college football coaches to ink a shoe contract when he signed on with Nike in the early 1980s. Schembechler never took any money from the contract, Seyferth said, but gave the funds to his assistants to pay for their children's college tuitions.
In the 1980s and early 1990s, UM's coaches had about a dozen different contracts at any one time with manufacturers including Rawlings, Speedo, Champion and others. Nike cornered the coaches' fees for men's football and men's basketball and at times for track and tennis.
In 1994, the Big Ten mandated that its members be a party to any contracts between coaches and apparel manufacturers. The University of Michigan began negotiations with several companies, and in the fall of 1994 Nike and the U-M signed a series of six-year contracts. Why Nike? "They demonstrated that they could service the broad range of teams the best," Seyferth said.
Michigan is one of eleven colleges that have lucrative "all-school" contracts with Nike. The others are Ohio State, Illinois, Penn State, Oregon, North Carolina, Alabama, This year, U-M athletes, coaches and staff are wearing 1,615 Nike shoes, all made with what critics cali sweatshop labor. All were tax-deductible donations from Nike. ami, Florida State, Colorado and Southern Cal. Reebok has similar deals with Wisconsin, Texas and UCLA.
In exchange for providing millions in shoes and uniforms, scholarships, and "base compensation" which replaces the outlawed coaches' fees, Nike gets invaluable TV exposure, ments and worldwide marketing rights to the official U-M athletic merchandise. Michigan is second only to Notre Dame in merchandise sales among U.S. universities.
Small of Nike says the company has ties with about 250 colleges, most of them with coaches. Nike recently also has signed contracts with about 100 high school programs nationwide.
Some critics have suggested that high school coaches under contract to Nike might influence whether students choose a Nike college. Small said that notion is unproven speculation.
"If we reach the point where a prospect comes out of a high school and chooses to attend the University of Michigan because it's a Nike school, instead of for other more valid reasons, then we're in sad shape," Small said.
The deal with Nike greatly benefits U-M athletics, university officials say.
"It provides quality merchandise and equipment for all 23 of our varsity sports," Seyferth said. "We could not have afforded to put all of our teams into quality uniforms and equipment without it. It's a tremendous plus for all our sports."
No longer do men's teams get better gear than women's teams, Seyferth said: "It helps greatly with gender equity.Nike's resolved that question in terms of equipment."
The contract grandfathers in prior coaches" consulting contracts in men's football and basketball until they expire or a new coach is named, at which point Nike kicks in an extra $200,000 a year. Under the new arrangement, no coaches' fees are paid, said athletic department business director Jim Balgooyen. All of Nike's money goes into the university's general fund. Former football coach Moeller was paid by U-M and Nike; his successor, Lloyd Carr, is paid only by U-M, but at a higher rate which Nike helps to subsidize.
"One of the driving forces behind this is to bring much closer oversight by the department to these contracts, but not to reduce coaches' contracts," said Keith Molin, senior associate athletic director.
Seyferth originally refused access to Nike's contracts with U-M, saying "It's not to our advantage to be promoting these things. You can take things and misinterpret them any way you want." Under a Freedom of Information Act request, AGENDA then obtained copies of the contracts.
M Goes Swoosh
"This is not Nike University," Fritz Seyferth said. "Nike doesn't decide what we do here."
Nike can break off its contract if the university or its coaches "knowingly take action inconsistent with the use of Nike products." Asked what that means, Seyferth said: "I have no idea. Doing something that would be detrimental to the image of Nike, I guess."
The contract requires coaches and staff to wear Nike products, and stipulates that the university "shall advise team members of the advantages of wearing andor using Nike products during such activities." Asked if the university has any policies requiring athletes to wear Nike or specifying penalties if they don't, Seyferth said no. But the university clearly has a lot at stake in "advising team members of the advantages" of wearing Nike. Nike can void the contract "if members of any team fail to wear or use Nike producís during practices, games, clinics or other official activities ... or wear them altered, spatted or taped."
The contract says "spatting" or taping the shoes "so as to cover any portion of the Nike logo" is "inconsistent" with the contract. The University "acknowledges its commitment not to permit such taping, and to ensure that all other Nike Products worn or used by team members remain unaltered, so as to allow the Nike logo on the Nike producís to remain visible."
When athletes have problems with injuries or fit which require shoes to be taped and Nike and U-M can't resolve the issue, other shoes can be worn as long as they don't "bear the visible trade name, trademark or logo of any other company."
Seyferth says he knows of no athletes who have balked at wearing Nike products because of concerns over Nike's labor practices. The University of Michigan may not be "Nike University," but by August 2000, the Nike swoosh will have appeared on nearly 10,000 athletic shoes and more than 13,000 other shorts, jerseys, jackets, socks, capes, equipment bags and other items used by U-M athletes. Nike ad panels now grace Crisler Arena and Yost Arena, and the swoosh appears in media guides, schedules, programs and videos. And Nike can use any U-M coach 's name, nickname, initials, autograph, voice or image to endorse Nike products.
Nike alone has the right to sell "authentic" UM athletic merchandise. Other vendors retain contracts to sell products with U-M's logo, but only Nike can sell the official gear as worn by the athletes, which commands a higher selling price.
Not only that, but Nike "may elect" to design a new logo for the university. If the university OKs a new logo, Nike gets the exclusive rights to sell all products that bear it.
Under the contract, the university "shall not permit the trade name, the trademark, names, logo or any other identification of any person, company or business entity other than Nike, or the University of Michigan if approved by Nike, to appear on Nike products worn or used" at athletic events.
The only non-sports item in the contracts is a $55,000 annual Nike scholarship to the Michigan Journalism Fellows program for each of five years. The program annually brings a dozen working journalists from around the nation and world to the university for a full academic year of study. Nike spokesman Small said a journalism scholarship is "something we have in most of our all-school contracts." Asked why, Small said: "We have a desire to possibly use that as a pipeline for employees, to hire (people) from internships" to work for the company in public relations.
Charles Eisendrath, director of the journalism fellows program, said the University asked Nike to include the scholarship because "we were interested in having one of our positions go to a sports reporter."
The contract says "a representative of Nike, Inc. will be a fully vested participant in the
(SEE NEXT PAGE)
selection process for the recipient of the Journalism Fellows program." But Eisendrath said neither Nike nor any of the program's other underwriting companies, which include several newspaper corporations, Ford Motor Company and the Kellogg Foundation, have any role in selecting who gets fellowships. He said the contract was negotiated without his input and the language about Nike's role is incorrect.
NIKE'S CONTRACTS WITH U-M
In the fall of 1994, Mike and the University of Michigan signed several agreements that extend through August 2000 the details:
PRODUCT SUPPLY CONTRACT
The University gets:
-Nike apparel and shoes, totaling more than 23,000 items over six years, for football, basketball, hockey, baseball, softball, swimming,wrestling, golf, tennis, field hockey, cross-country track and field, gymnastics, volleyball, soccer and cheerleading squads,
-Up to $68,000 a year in additional merchandise from Nike's product catalogs.
-$15,000 more in merchandise for the men's football team.
-Up to $50,000 more in non-Nike apparel products covering item Nike buys that are not available in the Nike product line.
$200,000 in 'base compensation' to replace pre-existing contract contract with football coach.
$200,00 in 'base compensation' to replace pre-existing contract with to replace pre-existing contract with basketball coach Steve Fisher if and when he is replaced (Fisher continues under pre-existing coach's contract with Nike).
One free pair of shoes for each two pair bought from Nike for each two pair bought from Nike for the University's marching band.
Four summer internships for students at Nike's Oregon headquarters; Nike either pays salary or students get academic credits and Nike pays expenses.
Nike gets:
Pledge that all coaches, staff and team members wear only Nike apparel, with logo visible, at all athletic events.
Exclusive designation as the university's official merchandise supplier.
Right of first refusal to extend the contract after six years.
Right of first refusal to extend the contract after six years.
First rights to sell new products to the university.
The City of Ann Arbor gets:
Pledge that all coaches, staff and team members wear only official Nike apparel, with logo visible, at all athletic events.
Exclusive designation as the university's official merchandise supplier.
Right of first refusal to extend the contract after six years.
First right to extend the contract after six years.
First rights to sell new products to the university.
The City of Ann Arbor gets:
$50,000 from Nike for an outdoor basketball court at the Southeast Area park, near Platt and Ellsworth.
PROMOTION AGREEMENT
Nike gets:
Exclusive rights to sell "authentic" University of Michigan sports apparel.
The right to design a new logo, subject to university approval,and exclusive rights to sell all products with that logo.
Rights to endorsements from U-M coaches for Nike products.
SPONSORSHIP CONTRACT
Nike gets:
Two advertising panels at Crisler Arena.
Four advertising panels at Yost Arena
Right of first refusal for any new signage space at university athletics facilities.
Its logo in media guides, schedules, and other sports publications and videos.
Season tickets: 10 for football, six for men's basketball, six for women's basketball, four for hockey.
50 tickets to one home football game and four tickets to all away games.
25 tickets to one home basketball game and four tickets to all away games.
Six tickets to home basketball game and four tickets to all away games.
25 tickets to one home basketball game and four tickets to all away games.
Six tickets to all post-season football and football and basketball games.
25 tickets to two home hockey games.
112 other tickets and eight field passes for 1994-95 games.
The University gets:
$35,000 from Nike in 1994-95 and $60,000 each year after that.
SCHOLARSHIP FUND
Nike donates:
Six annual $25,000 athletic scholarships for a women's basketball player.
Six annual $25,000 athletic scholarship in any sport for a
woman "who exemplifies a commitment to improving the lives of America's disadvantage youth."
$45,000 over three years to the Chris Webber Endowment for scholarship aid to LS&A students.
Five annual $55,000 scholarships totaling $275,000 to the university's Michigan Journalism Fellows program.
SERVICES & ADVERTISING CONTRACT
Nike gets:
Ads in football, basketball and hockey programs.
Up to six appearances by football and basketball coaches and up to three appearances by other coaches annually to endorse Nike.
Participation by men's basketball team in Nike tournament.
Participation by U-M coaches in confidential testing of Nike products.
The University gets:
$15,000 first year, $30,000 each additional year.
RETAIL SALES AGREEMENT
Nike gets:
Space in U-M athletic for retail sales on game days.
Hoop Dreams
The first Nike shoe was built in Japan in the early 1970s. Soon, Nike moved into South Korea, where for years it produced shoes under the repressive Chun Doo Hwan regime. In 1987, after open elections, labor and the new government raised the minimum wage to $1 an hour. Nike quickly took most of its operations out of the country, moving to China, Vietnam and Indonesia.
In a letter to shareholders last September, Nike CEO Knight posed his own versions of cntics' questions and answered them. The first was "Why on earth did Nike ever piek such a terrible place as Indonesia to have shoes made?" Knight's answer:
Effectively, the State Department asked us to. In 1976, when 90 percent of Nike's production was in Taiwan and Korea, Secretary of State Cyrus Vanee asked Charles Robinson, who had been Deputy Secretary of State in the Ford Administration, to start the U.S.-ASEAN Business Council to fill the vacuüm left by the withdrawal of the American military from that part of the world. Secretary Vanee wanted to fill that void with a stronger American business presence.
Chuck Robinson accepted the challenge, put together the council and served as Chairman of the U.S. side for three years. Mr. Robinson was a Nike board member at that time as he is today. Nike was one of 75 U.S. charter members of the council.
"Nike's presence in that part of the world," according to a senior state department official at that time, "is American foreign policy in action."
Today the ASEAN countries are among the world leaders in the rate of economic growth.
Nike officials portray their company as a benevolent promoter of prosperity, participation in sports and a youthful attitude. Nike's letter to university presidents maintains that underdeveloped nations "must trade or they die. It has been repeatedly demonstrated that the best way out of poverty is through exports of light manufactured goods - toys, clothes or shoes. Nike is enormously proud of the role we have played in helping to build economies in developing nations."
The experience of Bata, a Canadian shoemaking company, calls into question the argument that export industries lead to higher-paid jobs for Third World workers. Bata pays full-time workers producing cheap shoes for the Indonesian market nearly twice what it pays workers making Nike shoes for export. It must pay the low wages for Nike work to compete with other Nike subcontractors.
Nike told its university partners thal it is "a company that has created enormous wealth where none existed before." The letter to college presidents portrayed Knight's earnings as a measure of Nike's benevolence: "Admittedly the salaries earned by top executives in American corporations are ampie, but without them, the world would be a poorer, less employed place."
The millions Nike pays to stars to pitch its products are also, according to the Nike letter, a form of philanthropy: "Workers in developing nations are not being robbed when the company gives a lucrative endorsement contract to the world's greatest basketball player. Just the opposite: Michael Jordan increases the demand for the goods these workers produce, creating upward pressure on wages." Nike's critics point out that Jordan makes $5 million dollars more a year than the company's entire Indonesian workforce. Giving his fee directly to the workers would create an immediate 33 percent wage increase, more tangible than "upward pressure."
Nike has denied or minimized most of the reported incidents of worker harassment by its Taiwanese and Korean subcontractors. According to Knight's letter to stockholders, those bosses came to Nike plants in Indonesia and Vietnam because the company felt an attachment to them: "Essentially, we work with Asian partners - not partners in the legal sense but in an emotional sense. When a country outgrows the shoe industry, we do not abandon years of factory management and strong relationships. The entities go with us to make shoes somewhere else."
Retired military officers are on the payroll at many Nike factories in Indonesia. One Nike worker told Press for Change, a labor activist group: "The only rest you get is after you collapse at your machine." The same worker said physical attacks by Korean bosses on workers were frequent.
The Indonesian government's increasingly vicious crackdown on independent labor movements prompted clothing manufacturer Levi-Strauss to abandon its plants there. Nike responded by expanding its production faciles.
In 1993. Nike instituted a code of conduct which requires compliance with all local laws, prevention of forced labor and adherence with local regulations on health and safety. Three years later, only one worker out of more than a dozen interviewed by a reporter at Nike's plant in Serang, Indonesia, had ever heard of that code.
"Their code of conduct has been a charade," said Jeff Ballinger of Press for Change.
Nike says it has 800 staff members in Asia who monitor plants to ensure compliance with its code. But Nike refuses to allow independent monitoring of its plants. It relies on an audit done by Ernst & Young, an accounting firm Nike hired.
A resolution asking for independent monitoring was presented at the 1996 Nike stockholder meeting by the Interfaith Center on Corporate Responsibility, a coalition of 275 Protestant, Catholic and Jewish institutional investors. At that meeting, Nike gave shareholders a presentation by Georgetown coach Thompson and board member Jill Conway,a historian and former president of Smith College. The company sent the pair to Indonesia on a "fact finding" mission. Both found nothing but happy workers.
"I came away feeling a lot more satisfied," Thompson told stockholders. "I did not see the kinds of things that I had heard about."
Conway told shareholders that Indonesian workers in Nike plants were on the fast track: "If you improve your skills in a Nike stitching line and you start out being trained and you can take extra classes if you want, after a couple of years, you'Il be paid what a surgeon is." She added: "The women have very nice, healthy skin, shiny hair."
In his letter, Knight finally promised stockholders that he would "invite a group other than Ernst & Young to review" Nike factories this year.
"We know these are the best shoe factories in the world," Knight wrote.
Knight insisted Nike's Indonesian workers make an average wage that is twice the minimum wage. But when surveyors for the U.S. Agency for International Development last year interviewed 550 workers in one Nike-shoe factory near Bandung, West Java, 80 percent of the workers reported earning only the minimum wage.
Small contended that "we pay wages that are at least the government-mandated mínimums, and on average 50 percent above that." He said the double-wage figure Knight mentions includes all overtime and the 50 percent figure is an average for Nike plants worldwide.
Forced overtime is a major complaint of Nike workers in Asia. Workers told USAID researchers that management punished them for taking sick days, even with a doctor's letter.
As for child labor in Pakistan, Nike officials insist they were unfairly maligned. In his letter, Knight told stockholders Nike placed its first order for 40,000 soccer balls in 1996. "This is one-tenth of one percent of the halls exported from a country where balls have been made for decades he said.
The deal with Nike greatly benefits U-M athletics, university officials say. For example, no longer do men 's teams get better gear than women's teams, Seyferth said: "It helps greatly with gender equity. Nike's resolved that question in terms of equipment."
"The problem is the nature of the cottage industry in Pakistan. Ball stitching is farmed out all over the countryside, making it virtually impossible to control." Knight didn't explain why Nike entered a market widely known for exploiting child labor.
Nike and Reebok recently have opened centralized "stitching centers" where the age of workers can be monitored. Knight told shareholders : "Nike and Reebok are changing abusive conditions that have existed in Pakistan for decades."
Trim Bissell, coordinator of the Campaign for Labor Rights, said Nike knew exactly what it was getting into in Pakistan: "They try to present themselves as this progressive leader in the industry, but they got caught using child labor in Pakistan, one of the most notorious countries in the world for child labor." Bissell said the stitching centers are "a victory for the paign" against Nike, but do nothing to address the conditions Nike's adult laborers encounter.
"Child labor is really not a major issue with Nike, but their policies are anti-child," Bissell said. "They have mothers working forced overtime, horrendous hours, and not paying them enough to feed their families, exposed to glue fumes and dangerous chemicals."
Last year, Nike joined President Clinton's Coalition on Foreign Manufacturing, an industry-labor-government advisory group which is supposed to develop independent monitoring and product-labeling procedures for global labor. Knight explained to shareholders that the committee would help Nike defend itself by setting up "standards on what is a sweatshop, because we think we're hurt by having no standards there, that all anybody has to do is cali a Nike factory a sweatshop."
Rarely do universities spurn corporate money. A notable exception was the divestiture in the 1980s of university investments in companies doing business in South Africa. That carne only after years of campus and off-campus protests by anti-apartheid activists.
If The Shoe Fits
Bissell said universities shouldn't necessarily reject Nike's donations, but he argued : "These donations by Nike, while they may benefit schools and universities, don't cost Nike a penny. These are a good tax-underwritten form of advertising, a well-tested tool of industrial philanthropy.
"The reason they have that money is they' ve been ripping off people all over the world."
The University of Michigan can get out of its contract with Nike if the company goes bankrupt. But there is nothing that allows it to break off ties over any corporate policies or behavior. Nonetheless, Seyferth said, "If they really turned out to be a company we didn't want to be affiliated with, we would let them know regardless of the contract."
All signs are that the Nike swoosh, symbol of defiant youth, will continue to fly across the M campus.
"Basically , Nike grew up as an anti-establishment company," CEO Knight told the Associated Press last year. "But we have to grow up a little bit and play with the establishment powers. I think we're making progress that way."
Critics aren't impressed with Nike's progress. On Feb. 21, protesters carried giant Indonesian shadow puppets as Nike dedicated a new superstore in San Francisco.
"It seems like a lot of universities are up for sale," said Ballinger of Press for Change. "Young people in our country shouldn't benefit from the sweat of young people in the Third World."
CONTACTS: Organizations conducting campaigns against Nike include:
Campaign for Labor Rights, 1247 E Street SE, Washington DC 20003, 541-344-5410, web site at http:www.compugraph.comclr
Press for Change, PO Box 1 61 , Alpine NYJ 07620, 201-768-8120
Global Exchange, 201 7 Mission Street, Room 303, san Francisco CA 94110, 1-800-497-1994, email to gx-info@globalexchange.org
To support Nike: Contact the "Green Swoosh Campaign" on the Internet.