December 1, 2008 - Here's what struck me in Fortune's recent article on Nike titled, "Citizen Nike" that looks into labor conditions in Nike's supply chain: despite real, serious efforts on Nike's part, conditions in the factories that manufacture their shoes hasn't improved significantly in the last decade.

Want proof? If you make it to the last page of the article, you'll find a sobering quotation by Richard Locke, a professor at MIT's Sloan School of Management, stating that:

Despite 'significant efforts and investments by Nike"¦workplace conditions in almost 80% of its suppliers have either remained the same or worsened over time.

The article goes on to say that in Nike's fiscal 2006 audit of its 42 factories, 7 got an 'A' (best) rating and 13 got D's (worst rating) because of multiple transgressions.

(An aside here is how incredibly friendly Fortune is to companies in these sorts of profiles. If they wanted to write an article titled "Sweatshops Still Haunt Nike" or something similar, I'm sure they could have.)

This is incredibly sobering. Nike has taken CSR - specifically, improving conditions in their supply chain and lessening the environmental impact of their products - very seriously. They've appointed Hannah Jones, a well respected, senior person in the organization, to lead this effort and given her a team of 135 people around the world. Plus, she reports directly to CEO Marc Parker. Nike has taken a leadership role in disclosing who their suppliers, have been transparent about conditions in their supply chain, and they've been very public about their commitment to change. And in some areas (like the environmental impact and amount of waste in their products) they seem to have made some real strides (pun intended).

But on the question of Nike's factories, things are either the same or have gotten worse.

My point is: if it's this hard for Nike to move the dial on these issues, then it’s REALLY hard to make an impact as a "responsible corporate citizen." Plus, the areas where Nike has made the most progress are those where there's a strong business case (reducing $800M a year in material waste in shoe manufacturing), which gives me more hope for initiatives that have to do with efficiency and cost savings (read: green) and less hope for those that involve real tradeoffs (read: wage levels, healthcare, benefits, workers' rights).

I’m incredibly glad that "corporate social responsibility" has gotten traction in recent years, but my personal experience resonates a lot more with what I read in this article about Nike (even with great intentions, commitment and resources, making real headway is hard and slow) than when I see advertisements proclaiming how a given company gives back and makes a difference.

In those cases, I’ll believe it when I see it.

About Sasha Dichter

Sasha Dichter is, among other things, the Director of Business Development at Acumen Fund, a global non-profit venture capital fund that invests in enterprises that fight poverty in the developing world. Click here to read more of his blogs.

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