- The China Challenge: Beijing Faces Long Odds in Quest to Overtake the U.S.
- The China Challenge: Enjoying Key Advantages, the Mainland May Soon Overtake the U.S.
- The China Challenge: A Demographic Predicament Will Plague the Mainland for Decades
- The China Challenge: Spurning Mandarin, Speaking English and Becoming a Hong Konger
- The China Challenge: Beijing Sees the West as Roadblock in its Bid for Status as World’s Top Superpower
- The China Challenge: Rebuilding Trust in the Global Trading System
- The China Challenge: America as a Rising Power
- The China Challenge: Space Race 2.0
- The China Challenge: The West Struggles To Respond To Beijing’s Forced-Labor Camps
- The China Challenge: The Present and Future of U.S.-China Relations
- The China Challenge: Beijing Is Pursuing the Wrong Strategy in its Bid To Win Allies
- Has China Won the Wireless Wars?
- The China Challenge: Nuclear Deterrence and Soft Power
- China Enters Unsteady Waters as Xi Tightens Grip on Power
- China’s Collection of Data on Foreigners Is a National Security Risk
- The China Challenge: The Stain of Forced Labor on Nike Shoes
- In China’s Endless Campaign To Erase Taiwan, No Target Is Too Small
- The China Challenge: Risks to the U.S. Economy if China Invades Taiwan in Seven Charts
In March 2020, a damning report from the Australian Strategic Policy Institute revealed that the Chinese government was forcing hundreds of young Uyghur women to produce Nike shoes in the Taekwang factory in Laixi City. Nike says the factory has stopped using forced labor. So how credible are the sneaker company’s assurances?
The South Korean-owned Taekwang factory is one of Nike’s largest suppliers, producing 8 million pairs of Nike footwear a year—including signature lines such as Air Max and Shox. It partnered with Chinese-government-run forced-labor programs that are linked to crimes against humanity.
One of these programs takes Turkic residents from rural areas in Xinjiang, the northwest region of China, and forces them to leave behind their children and other members of their families to work in factories across China. Another relocates detainees who have “graduated” from a network of concentration camps in Xinjiang.
One of the Uyghurs forced to work at the Taekwang factory confirmed in a Washington Post report that the Uyghur workers were not allowed to return home: “We can walk around, but we can’t go back [to Xinjiang] on our own.” (Chinese police detained the journalist who wrote this article and forced her to leave town.)
After arriving at the factories, the Uyghurs and other Turkic people were required to attend reeducation classes under “military-style management” similar to those in the camps. According to Chinese state media reports, one such reeducation night school opened in the Taekwang factory compound in June 2019. After Uyghur workers finished stitching and gluing Nike shoes for the day, they attended “patriotic education” night classes.
After the release of the Australian institute’s report, Nike said the Taekwang factory would end its contracts with Uyghur workers. According to Nike’s website, the brand went on to conduct “an independent third-party audit [that] confirmed there are no longer any employees from [Xinjiang Uyghur Autonomous Region] at the facility.” Nike decided it was then fine to continue doing business with this supplier.
In theory, an auditor who specializes in detecting Uyghur forced labor can conduct interviews with locals and non-Uyghur factory workers off-site (as the Post journalist did) to find out whether a large number of transferred Uyghurs still work at the facility. (This is not true of factories in Xinjiang, where it is impossible to conduct a meaningful audit.) But considering that Nike’s previous audits failed to detect its supplier’s participation in forced-labor programs, can we really trust that Nike’s new audits are strong enough to uncover the truth?
When I asked Nike to provide a general description of its new auditing protocol, its communications department declined to provide any comment beyond a link to a vague statement on its website.
Falsified Records Fool Auditors
Nike’s reticence is concerning because the quality of audits can vary widely, and even comprehensive audits could fail to detect Uyghur forced labor unless certain protocols are in place.
Social-compliance audits usually cost $1,000 or more and look at a factory’s working conditions and environmental practices. They might include interviews with employees and managers, visits to worker dorms, and a review of time sheets and wage documents. But a standard social-compliance audit can’t detect Uyghur forced labor. After all, the Uyghur workers—many of them likely former concentration-camp detainees—cannot speak freely to auditors without risking their lives.
Employee records may show auditors that the workers at the Taekwang factory are not from Xinjiang. But these records can’t be taken at face value. There is a cottage industry of consultants who specialize in helping Chinese factories falsify employment and production records.
According to Chinese auditors I interviewed for my book, “Made in China: A Prisoner, an SOS Letter, and the Hidden Costs of America’s Cheap Goods,” these consultants know exactly what auditors look for because they were once auditors themselves. “They get trained by auditing firms and then go work for a consulting company,” a Chinese auditor told me.
Such consulting firms sell software that can create fabricated production data for 3,000 workers in just 30 minutes. China Labor Watch, a New York-based organization that advocates for workers, found a consulting firm in Shanghai advertising software that could create fake accounting books and “irregular attendance records that match factory testing standards completely.”
Did Nike make sure that the records its auditors viewed were authentic? Without more information about how Nike responds to challenges such as falsified records, it is difficult to believe Nike’s claim that the Taekwang factory no longer uses forced labor.
Pressure for Accountability
Momentum is building in the U.S. Congress to impose greater oversight on companies that may be using forced labor in China. For example, the Uyghur Forced Labor Prevention Act will soon require importers to verify that forced labor from Xinjiang is not part of their supply chains. And since 2020, U.S. Customs and Border Protection has issued several detention orders that make it harder for products made by forced labor in Xinjiang to enter the U.S.
On a cultural level, the tide is also turning in favor of stronger corporate accountability. The National Basketball Association has historically maintained a close relationship with Nike, and the Chinese market is worth more than $5 billion to the league, but one player has voiced his concerns about Nike’s supply chain in recent months. Since October, Enes Kanter of the Boston Celtics has used social media posts and custom-designed footwear to criticize China’s treatment of Uyghurs, Tibetans, Hong Kong and Taiwan. On Oct. 25 he wore a pair of shoes with a message directed at the NBA’s largest sponsor: The words “hypocrite Nike” and “made with slave labor” were written across the sides.
On social media Kanter said, “Millions of Uyghurs are currently detained, sold and assigned to work at forced-labor camps, prisons and factories across the country. They are under constant surveillance, with long working hours and poor living conditions.” He continued, “Don’t forget, every time you put those shoes on your feet, or you put that T-shirt on your back, there are so many tears and so much oppression and so much blood behind it all.”
Just as the global anti-sweatshop campaign against Nike in the 1990s prompted the brand to make meaningful improvements to the way it monitors suppliers, a new wave of awareness is forcing brands to rethink corporate social responsibility.