Investor Pressure Mounts on Nike Ahead of Shareholder Meeting

Investor scrutiny is intensifying for Nike as Norway's sovereign wealth fund backs a resolution to improve working conditions in garment factories ahead of Tuesday's annual shareholder meeting. Nike is grappling with declining sales and criticisms over its supply chain, prompting calls for binding agreements with workers in high-risk countries.

Investor pressure on Nike is escalating as Norway's sovereign wealth fund has promised to support a resolution aiming to enhance working conditions at garment factories, right before the company's shareholder meeting on Tuesday.

Nike is currently facing declining sales and criticism over supply chain issues. Despite engaging with shareholders, the company was downgraded by MSCI in 2022 and 2023 for poor labor standards. The proposed resolution by investors, including Domini Impact Equity Fund, highlights the frequent failure of current industry approaches to address persistent rights abuses.

Last year, over 60 investors signed a letter urging Nike to pay $2.2 million owed to workers in Cambodia and Thailand who were denied severance after factory shutdowns during the pandemic. Although Nike denied these claims, investors are pushing for binding agreements in high-risk countries to improve human rights compliance.

(With inputs from agencies.)