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Nike Issues

In: Business and Management

Submitted By moro
Words 1883
Pages 8
Problem #3 Nike is not eco-friendly
Symptoms:
Nike has a huge demand in the leather industry. The leather industry, is closely linked with the meat industry, that is, the leather is a byproduct of the meat processing operation, the demand for shoes, belts and clothes which are made by leather directly contributes to preserve farms and slaughterhouses, since it is the most valuable byproduct of the meat industry.

70% of China’s rivers, lakes and reservoirs in China are now classified as polluted. ( Zi-jian W) Many companies, such as Nike, are link with China's textile factories that use dangerous substances discharged to water. Many chemicals released from the textile mills put threat to human health and the environment. Now china is suffering because most of their water is polluted, and is very difficult to reverse the damage.
Nike spends a lot of money and CO2 in the process to manufacture their products. The waste of CO2 is one of the mayor cause of the global warming, we can see everyday in the news that glaciers have shrunk, ice on rivers and lakes is breaking up, also plant and animals have been change. According to the NASA there are some effects that are cause by the global warming such as hotter days and nights, Heat waves more frequent over most land areas, Increase in intense tropical cyclone activity in North Atlantic, Global area affected by drought has increased. (http://climate.nasa.gov/)
Causes:
-The huge demand of leather, beef and other cattle products produce the leading cause of deforestation in the Amazon and may make a climate change.
Nike deals with manufactures in china that buys leather from a Brazilian company called Bertin, one of the three major intermediates of beef and leather in Brazil. According to a report by the Organization of the United Nations Food and Agriculture Organization (FAO), the livestock sector generates more greenhouse gases-18 percent, measured in equivalent carbon dioxide (CO2). It is also a major cause of land degradation and water resources. (Staff Writers) so the cause of selling a lot of leather to many companies around the world would cause a huge destruction to the environment.
-Nike manufactures use toxic chemicals to produce clothes and textiles.
Today, global warming and climate change is an undeniable reality. Virtually all people of the world are aware of it and there is growing awareness of the need to protect the environment and life that inhabits it. One of the most widely used to prevent contamination is the sustainable production, which modifies certain practices in industries related to transportation, food and construction. Another sector that is not outside of it is, textiles, which in recent years showed interesting projects where respect for the environment and human rights became protagonists. Nike clothes have a significant environmental impact. Although many are not aware, the traditional textile production generates a very negative environmental impact not only by the constant consumption but also by the type of production involved in their manufacture. Synthetic materials like nylon, rayon or polyester cause pollution and health damage. Natural products such as cotton can also be harmful by toxic substances used in their conservation. Much of the clothing is made with this fiber, whose plant is treated with pesticides that affect soil, air and health of people. These substances often contain heavy metals that pollute water and affect the health of ecosystems. Consequences of a contaminate water is that can be harmful to the human body and now turning up into china’s food and drinking water. In addition, when factories polluted the water with these toxic chemical are causing the death of million of fishes. Nike is no the only responsible from contaminated the water in china, there are more companies throwing toxic chemicals to China’s rivers. For example, the Yellow River, China's second longest river after the Yangtze, is getting worse everyday, with over 66 percent of the water undrinkable, according to a newly released report on Yellow River Water Resources (Xinhua)
-Big companies such as Nike waste a lot of CO2 trying to produce their products, since Footwear manufacturing is the largest remaining part of CO2 footprint. However the challenge to reduce it is very difficult. The waste of CO2 involves everything that happened inside and outside of the company. According to the report to Nike’s report the mayor issues with CO2 are retail packaging with 32% and shipping packaging with 32% follow by the footwear manufacturing with a 17%, apparel manufacturing 9%, retail environment 7% and finally publications with 2%. Nike is waste a lot of CO2 with the packaging (considered design and the environment.) the mayor consequences in the waste of CO2 is the climate change including the global warming.
Alternatives 1:
Nike, the sporting goods manufacturer, announced that it will stop using leather obtained from cattle raised in the Amazon rainforest in Brazil as part of a commitment to combat deforestation in the area.
Advantages:
• Customers’ loyalty.
• Become Sustainability company.
• Customers satisfaction
Disadvantages:
• Search for new cattle industry
• The risk to not find the same quality of leather with other company.
• Production would go slower without the supply of leather.
Alternative #2
Nike should use natural materials such as crop of flax, hemp or bamboo.
Advantages:
• The use of material such as crop of flax, hemp or bamboo is that it grows quickly and requires fewer chemicals in their production.
• Vegetable fibers are very soft and have a texture closer to silk or cashmere to cotton. Therefore it is very comfortable to wear, perfect for summer or year in warmer climates.
• Vegetable fibers rapidly absorbed and wicks moisture. For that reason the clothing helps keep you dry and odor-free during the vigorous activities you are sweating.
• Vegetable fibers are naturally antibacterial and hypoallergenic, because is grown without the aid of pesticides and other chemicals.
Disadvantages:
• The use of vegetable fiber in the production demands more water and the addition of chemicals to soften the material.
• Cotton is problematic in that the fiber is short and will not pass through traditional wool spinning machinery.
• High cost to manage natural fibers.

Alternative #3
Nike should move their manufactories to the Polar Regions, to use more hours of sunlight and waste less CO2.
Advantages:
• The company will use more solar energy.
• Spend less money in electricity.
• The company could be open more than eight hours at day.
Disadvantages:
• There are few population in Polar regions to work.
• Spend a lot of money shipping their product .
• More difficult to obtain basic resources.
• Living conditions are extreme.
Solution:
Alternative #1
Nike, the sporting goods manufacturer, announced that it will stop using leather obtained from cattle raised in the Amazon rainforest in Brazil as part of a commitment to combat deforestation in the area.
Nike took this decision to stop buying leather from companies linked to the destruction of amazons in 2010 because Greenpeace Company start to look at them and their cattle industry, moreover Greenpeace denounced in their report titled, “slaughtering the Amazons”, the destructive action on the forest because of the interests of the famous brands such as Nike. The relationship between these well-known international brands and the deforestation of the Amazon rainforest begins with the leather of the shoes used by the big brands to make them. This leather is an Asian production that comes from countries like Vietnam and China, who in turn buy from Brazilian companies working materials from cattle; consequently, Nike created a new policy to make sure that their leather is not coming from the Brazilian Amazons.
Timeline: 1 year and 5 months
Beginning:
Research have been done from companies such as Greenpeace to determined if Nike was destroying the Brazilian amazons, after the research, Greenpeace found the companies such as Nike and Adidas where buying all their leather to companies that contribute with the destruction of the Amazons.
A month:
Nike starts to work very fast in a new policy to take care about the environment and try to reverse the damage caused by them with a new policy.
Two months:
Nike announces that they will not buy leather from the amazons until supplier can prove they are not linked to cattle farms involve in its destruction. Nike was giving a second chance to their companies where they buy leather to fix this problem.
Three months:
Four of the biggest companies involved in the cattle industry got together to ban the purchase of cattle from areas like Amazons.
13 months:
Nike's new policy requires full traceability and transparency from their suppliers. If Nike suppliers are unable to provide credible assurances that leather used for Nike products is from cattle raised outside of the Amazon Biome, Nike will consider increasing the exclusion area to include all of the Amazon Legal (as defined by IBGE)."
17 months:
Nike show to have all leather suppliers working for a safer world. After Nike implement the new policy has made a lot of progress. Nike is working with Greenpeace and leather working group (LWG) to implement a procedure for leather traceability.

Concepts and Theory’s:
Sustainable management:
- Being a sustainable company is currently used to identify those companies whose philosophy and work culture seeking a balance between three main components: society, environment and economy.
-companies look for the balance between its components, without representing any damage or adverse impact on one another, including economic.
- The corporate sustainability is directly linked to business management: how the company is projected with respect to others and their level of creativity and innovation

Environmental scanning:
-responsibilities, practices, procedures, processes and resources to determine and implement environmental policy.
-An organization can achieve and maintain an operation in accordance with the goals it has set, and to respond effectively to changing regulatory pressures, social, financial, competitive and environmental risks.
Thus, the environmental management system provides the basis to guide, measure and evaluate the performance of the company, in order to ensure that its operations are conducted in a manner consistent with applicable regulations and environmental policy.

References http://www.greenpeace.org/usa/Global/usa/report/2010/2/slaughtering-the-amazon.pdf Shoemakers pledge to avoid Amazon leather. (2009). ENDS (Environmental Data Services), (415), 24

Doorey, D. (2011). The Transparent Supply Chain: from Resistance to Implementation at Nike and Levi-Strauss. Journal Of Business Ethics, 103(4), 587-603. doi:10.1007/s10551-011-0882-1

Stonehouse, G., & Minocha, S. (2008). Strategic processes @ Nike—making and doing knowledge management. Knowledge & Process Management, 15(1), 24-31. doi:10.1002/kpm.296

Yang, J. Z. (1998). Key Success Factors of Multinational Firms in China. Thunderbird International Business Review, 40(6), 633-668.
Plambeck, E., Lee, H. L., & Yatsko, P. (2012). Improving Environmental Performance in Your Chinese Supply Chain. MIT Sloan Management Review, 53(2), 43-51.

Zi-jian W. Major environmental and ecotoxicological processes of heavy metals in Lean River polluted by discha. Journal Of Environmental Sciences (IOS Press) [serial online]. September 1999;11(3):322. Available from: Business Source Complete, Ipswich, MA. Accessed March 7, 2012 http://nikeinc.com/news/nike-inc-amazon-leather-policy-update http://climate.nasa.gov/
By Staff Writers: http://www.terradaily.com/reports/Farm_Animals_More_Damaging_To_Climate_Than_Cars_999.html By Xinhua http://www.china.org.cn/english/environment/192263.htm

Considered design and the environment
http://secure.nikebiz.com/responsibility/documents/4_Nike_CRR_Environment_C.pdf…...

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