Challenged on Nike’s refusal to speak out more firmly on China’s human rights abuses since his company has a huge market in China, Nike CEO John Donahoe said his company didn’t have to sacrifice any of its values to do business in China, stating that Nike operating in China is “very aligned with our values.”
Donahoe told CNBC’s Ariel Eisen, “We participate in sport all over the world, including China.”
“China’s a very important market for us; we have a long-term history in China,” he smiled. “Phil Knight, our founder, was in China forty years ago, beginning to build what’s now an incredible consumer connection that Chinese consumers have with Nike, with (Michael) Jordan, with Converse.”
“And so we continue to invest in China; we have over 7,000 model brand stores in China through our Chinese partners; we’re the number one sports brand on T-Mall, have been for the last decades, still are today,” he boasted.
T-Mall is the biggest business-to-consumer retail platform in Asia.
“And so we take a very long-term view in China; we’re continuing to invest in China; we’ll continue to invest in China while also operating a very responsible global supply chain,” he continued.
“You told an analyst on the conference call last quarter that you are a brand; you said, ‘We are a brand on China and for China,’ which got a lot of attention given the attention from the U.S. and around the world on the human rights issues, the brutal clamp-down on Hong Kong, questions about where COVID-19 came from,” Eisen noted. “Do you feel like you have to sacrifice your values at all as a company to do business there and to continue to grow and continue those deep roots that you talked about Nike has there?”
“Not at all, Sarah,” Donahoe answered. “We connect the consumers in markets all over the world. And so I could say go in any country around the world and say consumer in that market consider Nike a brand of their market for them. And so that’s one of the reasons Nike’s been so globally successful. And we operate very aligned with our values, always have been, always will, including throughout our entire supply chain.”
He concluded, “And so this is simply part of the challenges of operating a global brand in global markets, And we’ve navigated that very well for fifty years and we will continue to do that.”
I asked Nike’s CEO why not speak out more on China’s human rights abuses when it is so out front on societal issues here in the U.S.? https://t.co/ZJU4Udi4aE
— Sara Eisen (@SaraEisen) August 5, 2021
In late June, after the huge Chinese market for Nike diminished because Chinese consumers launched a boycott following Nike’s remarks about the reported abuse of the Muslim Uyghurs, Donahoe made sure to reassure the Chinese he was on their side, telling Wall Street analysts, ‘Nike is a brand that is of China and for China,’” the BBC reported.
“Mr. Donahoe made the comments during a discussion on Nike’s fourth-quarter earnings, which showed revenues had doubled to a better-than-expected $12.3bn (£8.8bn) for the three months to the end of March. That helped it bounce back to a $1.5bn profit, from a $790m loss during the depths of the pandemic a year earlier,” the BBC added.
Nike also lobbied against a bill banning imported goods made with forced labor in China’s Xinjiang region, The New York Times reported in November 2020, adding, “Xinjiang produces vast amounts of raw materials like cotton, coal, sugar, tomatoes, and polysilicon, and supplies workers for China’s apparel and footwear factories. Human rights groups and news reports have linked many multinational companies to suppliers there, including tying Coca-Cola to sugar sourced from Xinjiang, and documenting Uighur workers in a factory in Qingdao that makes Nike shoes.”
In October 2019, Nike, apparently worried about blowback from the Chinese government after the NBA’s Houston Rockets general manager Daryl Morey had supported Hong Kong-based protesters, removed Houston Rockets merchandise from its Chinese stores.
“Houston Rockets sneakers and other merchandise were pulled from several Nike stores in major Chinese cities amid the furor surrounding a tweet from the team’s general manager in support of anti-government protests in Hong Kong,” reported Reuters. “Managers at five Nike stores in Beijing and Shanghai told Reuters during visits on Thursday they had been told in recent days via a memo from management that all Rockets merchandise had to be removed. Reuters was unable to view the memo. … Three Nike stores in Shenzhen also kept Rockets merchandise off the shelves, as well as NBA products in general, staff told Reuters by phone. Three Nike stores in Chengdu, a bustling inland city in southwest China, also removed Rockets products.”