Human Rights for Workers Bulletin

Vol. II, No. 12: July 21, 1997 

A Lesson from Young Report on Nike

A Code Needed for Code of Conduct Monitors

"I was disappointed at how few of the plant managers actually spoke the local language. This obviously works against easy communication and a strong relationship between the workers and the management."
That was one of the stronger criticisms that Andrew Young made in his recent report on selected labor conditions in 12 Nike factories in China, Indonesia, and Vietnam. He reflected that disappointment in two other sections of the 75-page report. For example: "Many of the problems we discovered in the audits [by an accounting firm] were largely the result of expatriate management who did not speak the language of the workers, creating communications barriers between the workers and the managers...."

But Young's own investigation suffered from a communications barrier. Since he and his GoodWorks International team did not speak the local languages in the three countries they visited, they had to rely on interpreters. They talked individually with workers in each factory, "usually without Nike management around," the report says. But the team relied completely on management's own interpreters, instead of hiring its own.

Nike's full-page newspaper ads claimed that Young interviewed "hundreds of workers." Young's report does not cite a figure on worker interviews conducted. Whatever the number, Young's reliance on the company interpreters raises questions about how forthcoming the workers were to his questions--and hence about the reliability of much of his survey.

Another Flaw in Young's Research Methods

 Further, Jeff Ballinger, a longtime worker rights advocate and critic of Nike's practices in Indonesia, holds that an "essential element" of independent monitoring is that interviews

"be carried out away from the factory compounds, although under some circumstances, workers' on-site dormitories could be used for interviews."
Young's team interviewed workers mainly on the factory floor. Thus, it is questionable how Young could be so certain in asserting, for example, that "there was not an oppressive atmosphere in any of the factories that we visited." Or that there was "no evidence or pattern of widespread and systematic abuse of workers."

Such sweeping statements show that monitors of codes of conduct badly need of a code of conduct of their own. They need guidelines setting down the kinds of evidence necessary to support their conclusions. Young says, for example, that the 12 Nike plants were "adequately ventilated."

 How Can You Know When Factory Ventilation is "Adequate"?

What may seem adequate to a visitor, however, may be a condition endangering the health of workers on a workweek lasting 60 hours or longer. This is especially so in shoe factories, where many workers are exposed to poisonous fumes from toxic glues used to attach soles. According to information collected first hand by Thuyen Nguyen, a Vietnamese-American business executive who inspected several Nike factories in and near Ho Chi Minh city, toxicity levels on the factory floor were three times higher than the maximum set by the Vietnamese government.

Besides, to save money on electricity, some foreign-owned shoe factories in China shut down airconditioning after visitors leave, according to investigations in provinces with concentrations of such factories. The investigators learned about the abuse only by talking to workers away from anyone on management's side--a basic precaution not followed by GoodWorks International.

(For an earlier analysis of the Young report, see our Bulletin of July 12 at beleven.htm. Web links to related information can be found there. See also the Web site of Australia's Community Aid Abroad for information collected as part of its NikeWatch Campaign.)

Why Is This Controversy Important?

 Nike is not the only company whose labor practices merit rigid scrutiny. (Privately, some Nike representatives have complained, "Why pick on us?") But Nike is an acknowledged leader even beyond its own industry, to the point that the Far Eastern Economic Review (8/29/96, page 5) said editorially, and admiringly, that globalization is creating "The New Nike Economy." In that sense, then, you can say that, as Nike goes, so goes the global economy. An exaggeration? Not much.

The facts and principles involved in this controversy deserve serious attention by anyone concerned about the fate of ordinary workers in the modern world. Beyond the information available on the Web, it is useful to read a new book, "Behind the Swoosh: the Struggle of Indonesians Making Nike Shoes," edited by Jeff Ballinger and Claes Olsson. It provides a great deal of basic documentation collected by Ballinger and others with first-hand experience in Indonesia. The 224-page book is available for $12.50 from Press for Change, P.O. Box 161, Alpine, N.J. 07620. A subscription to the Press for Change newsletter, "Nike in Indonesia," is available for $20 for six issues.

 'Independent Monitoring' That's Not Independent

 The July 28 issue of Business Week leads off its "Readers Report" column with a letter from Jeff Ballinger, headed "Nike Hasn't Learned Its Lesson." Commenting on a Business Week article of July 7 titled "Nike Hasn't Scrubbed Its Image Yet," Ballinger makes this telling observation:

"Young's GoodWorks International may have made a significant contribution, however, by providing a good example of what 'independent monitoring' isn't. In the coming months, President Clinton's apparel-industry partnership will unveil its plan for monitoring facilities. As GoodWorks' facile report makes clear, this monitoring must include survey work done by indigenous groups the workers trust, not using factory walk-throughs with a few ritual visits to local worker-rights groups."
(To read the U.S. Apparel Industry Partnership Agreement, check the U.S. Department of Labor's Web site, specifically the section at It contains other information on the Department's campaign against sweatshops.) 

Boycotts Often Don't Work--But So What?

"Historically, economic sanctions have a poor track record," says the Heritage Foundation. The theme is an old one: boycotts and other sanctions often don't work, so forget them. The conclusion has the warm support of most economists, who philosophically and viscerally abhor that kind of intervention in the market.

The Heritage Foundation, a Washington think tank on the conservative side, makes its case in a "backgrounder" paper titled "A User's Guide to Economic Sanctions," issued June 25. It goes to great lengths (32 pages) to argue that unilateral sanctions have a "downside," are "counterproductive," and have a have "few successes."

The basic assumption behind this argument is that sanctions should be judged solely by their effectiveness. Do they "work"? Let's test that assumption, starting on the personal level.

Avoiding Personal Complicity in Repression

I don't buy Shell gasolene. I don't do so because I find the Shell's overseas policies morally objectionable, especially in its support for the corrupt junta that rules Burma. (For the specifics, see the Web site,, of the Free Burma Coalition.) I hope that other vehicle owners will do likewise and that Shell will change its policies. But my boycott of Shell does not depend on those hopes. I simply do not want to be an accomplice, even with a few dollars, in support of a junta that is stomping on the rights of the Burmese people.

I also make every effort not to buy products manufactured in China. How do I know whether this toy, this shoe, or this shirt from the People's Republic was not made by a priest or a student in a forced labor camp? Or by teen-age girls working seven days a week in a firetrap? I have no way of knowing. I don't expect my personal boycott to change China's anti-worker policies or to change the administration's pro-China trade policies; I simply don't want to be an accomplice in supporting those policies. In the big picture, my boycott is meaningless. On the personal level, it means everything: it is an exercise in individual responsibility.

The 1997 Human Rights Watch survey grasps this point. "Because the goods purchased in one country may be produced by victims of repression in another," the report states, "the very act of consumption can be seen as complicity in that repression." The expansion of the global economy is creating "new and immediate connections among distant people," and is thereby spawning "a surprising new source of support for the human-rights cause," Human Rights Watch points out.

What About a Nation's Complicity in Foreign Repression?

That "new source of support" for human rights is producing not just individual boycotts like mine but pressures for economic sanctions imposed by governments, local and national. Should sanctions on these levels be judged solely by whether they produce results?

A Harvard economist, Dani Rodrik, has an approach to this question that differs from that of most economists. In his book, "Has Globalization Gone Too Far?", Rodrik argues that "nations have the right--and should be allowed--to restrict trade when it conflicts with widely held norms at home." He says that it may be "legitimate to restrict imports from a country whose labor practices broad segments of the domestic population deem offensive." However, he then adds:

"Trying to 'export' norms [such as a prohibition against child labor] by asking countries to alter their social arrangements to match domestic ones is inappropriate."
In his view, therefore, a sanction should be based on a "widely held" norm (i.e., an ethical principle with a broad base of support), but not by a desire to force a standard on another country. In other words, a sanction should not be motivated, and therefore not judged, by whether it "works."

A "key distinction" for Rodrik is this: "While considerations of fairness and legitimacy will guide a country's own social arrangements, even by restricting imports if need be, such considerations should not allow one country to impose its own institutions on others." Under this principle, Rodrik objects to the plans of the U.S. government to consider corruption in foreign countries as unfair trade. It is "coercive," he says, to threaten unilateral "retaliation against other countries because their business practices do not comply with domestic standards [in the United States] in order to force these countries to alter their own standards." [the italics are the author's].

Actually, various types of "coercive" unilateral pressures by the United States on other countries are routine when their practices have a negative impact on U.S. business interests. It's a different story, though, when it comes to a foreign country's practices having a negative impact on worker rights or other human rights.

Focusing on What 'Widely Held Norms' Mean for Burma

In fact, the main current concern expressed in the Heritage report is the widening campaign among state and local governments to prohibit public investment in companies that do business in Burma and to restrict procurement of goods and services from such companies. Massachusetts, New York City, and 12 other city governments have done so; other local governments may follow their lead. In Rodrik's terms, the governments are responding to "widely held norms." In Heritage's terms, they are adopting "a cheap way to please vocal domestic constituencies."


Robert A. Senser
Editor, Human Rights for Workers
(Send e-mail to

 Bulletin No. II-12: July 21, 1997


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