Norway's Wealth Fund Backs Nike Proposal on Worker Rights

Norway's wealth fund supports a proposal urging Nike to examine binding agreements with workers to better address human rights issues. Nike has advised voting against this proposal by Domini Impact Equity Fund, which claims Nike lags behind competitors in worker agreements. Shareholder votes will take place on Sept. 10.

Norway's $1.7 trillion wealth fund announced its support for a proposal urging Nike to examine whether binding agreements with workers in high-risk countries would help address human rights issues. Being Nike's ninth-largest shareholder, this endorsement is significant, particularly as the proposal argues that Nike is behind its peers like Adidas and Puma in signing such legally binding agreements, including the Pakistan Accord.

Nike has recommended shareholders vote against this proposal, put forward by Domini Impact Equity Fund, during the annual shareholders' meeting on Sept. 10. Last year, Domini, along with over 60 investors, had urged Nike to pay $2.2 million in alleged unpaid wages to more than 4,000 garment workers in Cambodia and Thailand. Nike has denied these allegations, which stemmed from COVID-19 factory shutdowns that labor rights groups say led to lost wages.

The Norwegian fund, holding a 0.92% stake in Nike worth around $1.05 billion, stated that the company's board should account for material sustainability risks and broader social and environmental consequences. While supporting the worker rights proposal, the fund did not back another proposal requesting an assessment of Nike's supply chain policies' effectiveness, citing its previous lackluster support. Additionally, the fund will vote for a proposal demanding Nike reassess its sustainability strategy, following missed climate targets.

(With inputs from agencies.)