Nike shareholders told to vote against proposal to halt sourcing from China

Nike shareholders have been asked to reject a proposal that would stop the sportswear brand from sourcing its goods and raw materials from China.

The proposal was put forward by the label’s activist shareholders Domini Impact Investments and Vancity Investment Management and comes amid accumulating allegations of forced labour and human rights abuses in the country’s Xinjiang region.

The two firms were urging for the company to pause the sourcing of cotton and other raw materials from China until the US government’s Business Advisory is lifted or rescinded.

However, Nike’s board of directors advised its shareholders to vote against the proposal ahead of its annual general meeting.

In its argument, Nike said that it did not directly source materials from the region and its Corporate Responsibility, Sustainability and Governance Committee is continuing to provide oversight of its efforts towards sustainability innovation.

In its Proxy Statement, the company said: “Nike expects all our suppliers to share our commitment to respecting the rights of workers and advancing their welfare, with particular care for people with unique vulnerabilities such as women, migrants and temporary workers.”

Nike’s decision closely follows a report recently published by the United Nations (UN) in which the organisation had said that “serious human rights violations have been committed” in the cotton-producing region.

The report detailed the results of its investigation that explored the allegations against Xinjiang, ultimately challenging the country’s stance on anti-terrorism strategies and the use of vocational education and training centres (VETCS).