Reebok - Managing Human Rights Issues 'Ethically?'

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"I don't know that anybody has bought a pair of Reebok shoes because of its human rights programme. But we're a global corporation and we have an obligation to give back to the communities in which we live and work." ¹

- Doug Cahn, Director of Human Rights Programmes, Reebok International Limited.

Introduction

In January 2002, China Labor Watch² published a report on working conditions in six factories in China.

These factories manufactured footwear products for the US-based Reebok International Limited (Reebok), one of the leading footwear and apparel companies in the world. The report highlighted the poor working conditions in these factories. A similar report had been published in 1997 by two Hong Kong based non-profit organizations, which had accused Reebok's sub-contractors3 of violating some of the provisions of Chinese labor laws in footwear factories in China. With over a hundred years of operations in the footwear industry, a large workforce (estimated to be over 75,000 in 2002), and operations in over 170 countries across the world, Reebok's dominance in the global footwear industry was unquestionable.

However, with the focus of the international community drifting to human rights issues in Chinese footwear and apparel factories, Reebok joined the ranks of those companies that were accused of not paying sufficient attention to human rights issues. Reebok had taken several measures to prevent human rights violations in its Asian footwear manufacturing operations (Refer Exhibit I).

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1] As quoted in the article, "Reebok in China: Worker Elections in Two Supplier Factories," written by Alison Maitland in the Financial Times, dated December 12, 2002.

2] A New York-based independent non-profit organization for Chinese labor and human rights, which works towards improving Chinese workers' living and working conditions, defending their rights, upholding international labor and human rights standards, and preparing independent labor union organizations that are true representative of the workers.

3] In most Asian countries, Reebok manufactured its footwear and sports goods through sub-contractors. Sub-contractors were essentially middlemen who contracted workers on a daily wage basis. Reebok paid a negotiated amount to the sub-contractors, according to the size of contract. In most cases, the factories were owned by the sub-contractors.