If you've never read Naomi Klein's breakthrough book,
No Logo, I urge you to do yourself a favor and pick a copy. Even though it's five years old now, it is still the perfect antidote to a world where Tom Friedman's
The World Is Flat is near the top of the bestseller list. It's also one of those books that changes the way you look at the world around you, and, at the same time, a pretty good history lesson. Among many other topics Klein covers is the sweatshop fights of the mid-1990s. If you remember, Nike was near the center of that struggle.
Nike was a pioneer in a global outsourcing. Indeed, one of the things I remember being shocked at the first time I read Klein is that Nike doesn't actually make anything:
Nike, which began as an import/export scheme of made-in-Japan running shoes and
does not own its own factories, has become a prototype for the product-free brand. Inspired by the swoosh's staggering success, many more traditionally run companies ("vertically integrated," as the phrase goes) are busy imitating Nike's models, not only copying the company's marketing approach...but also its on-the-cheap outsourced production structure.
[emphasis added]
But that structure led to a mountain of bad press for the Oregon-based Nike:
Scandal has dogged Nike, with new revelations about factory conditions trailing the company's own global flight patterns. First came the reports of union crackdowns in South Korea; when the contractors fled and set up shop in Indonesia, the watchdogs followed, filing stories on starvation wages and military intimidation of workers. In March 1996, The New York Times reported that after a wildcat strike at one Javanese factory, twenty-two workers were fired and one man who had been singled out as an organizer were locked in a room inside the factory and interrogated by soldiers for seven days. When Nike began moving production to Vietnam, the accusations moved too, with videotaped testimony of wage cheating and workers being beaten with shoe uppers. When production moved decisively to China, teh controversies over wages and the factories' "boot camp" style of management were right behind.
[You long-time Michael Moore fans out there mighty also remember the scene in "The Big One" where he offers Nike CEO Phil Knight a plane ticket to Indonesia so he can see conditions there first-hand. If memory serves me well, Knight, in turn, invites Moore to the Australian Open tennis tournament. Neither man accepted.]
So what became of all this flack? Nike has what now must be the best outsourcing responsibility standards in America. Kossack "emptywheel" first explained this to me in comments to an earlier post of mine, but now you can read it in Fortune magazine:
Nike's 2004 Corporate Responsibility Report details its extensive--and expensive--efforts. The company now employs more than 90 people in 21 countries who try to enforce a code of conduct that covers safety, child labor, overtime pay, and human rights. It carried out more than 1,300 inspections and audits during the year and contracted with the Fair Labor Association, an independent nonprofit, to perform unannounced audits of 5% of its plants. This year Nike took the unprecedented step of disclosing the names and locations of its suppliers. In effect, the company was telling protesters that it no longer had anything to hide.
Klein also criticized Wal-Mart well before it was hip. For example, there was the Kathi Lee Gifford scandal (scandals actually) and Disney's Haitian Pajamas that sold in their stores. But for some reason, activists everywhere have let Wal-Mart get away with the kind of outsourcing practices that caused Nike so much grief. That has got to stop.
Like Nike, Wal-Mart doesn't actually make anything. They buy products from others and control the production network. Like Nike, Wal-Mart has an "image" to uphold. However, the popular red state notion that Wal-Mart is a "good, Christian company," should make it even more vulnerable to attack than Nike was. Lastly, both companies depend upon stars for their clout. Nike had Michael Jordan, Wal-Mart has Kathi Lee and Jon Bon Jovi. OK, they don't have Bon Jovi anymore, but that's not really important, is it?
Most importantly, unlike Nike c. 1995, Wal-Mart has given its critics the noose to hang it with (so to speak) by adopting standards that it doesn't follow. On Friday night, we learned how lame their factory inspection system is in Bangladesh. Over the weekend, we learned that whistleblower is suing Wal-Mart for firing him for exposing faked inspection forms from the company's suppliers in Central America. If activists keep looking, I'll bet there are countless other problems because this company obviously doesn't care. It's all for show.
The Nike counterexample proves that this kind of pressure can change big business. [There are a few other at least partially-changed companies I might mention to prove this point like Gap and Starbucks, but I don't want this post to get too long.] I know, there are so many things to attack Wal-Mart over, why stress conditions in other countries when their workers are in such bad shape here in the U.S.? Because, ironically, on paper at least least, Wal-Mart has offered to guarantee more rights for employees working for its suppliers overseas than they have for their own workforce in the United States.
How long will it be before activists from other countries come here to inspect human rights violations at Wal-Mart stores?
JR