Nike's Move to Zero – a commitment to achieving zero carbon emissions and zero waste, ensuring a sustainable future for sports
Nike, one of the world’s biggest sportswear brands, has set ambitious targets to reduce its carbon emissions and achieve ‘net zero’ status. With their ambitious Net Zero Goals, Nike aims to reach 100% renewable electricity and reduce greenhouse gas (GHG) emissions by 2025.
This article will explore Nike's net zero goals, the steps they have taken towards achieving them and the potential challenges they face in reaching the goals by 2025.
This article will discuss Nike's net zero status and highlight its commitment to environmental sustainability. Before digging into Nike, let’s understand the importance of net zero goals.
What Does Net Zero Mean and Why Is It Important?
Sustainable development has become a crucial aspect of business worldwide. As climate change presents significant challenges, companies like Nike recognise the urgency to reduce carbon emissions and contribute to a greener future.
Net Zero Goals play a vital role in this effort by focusing on balancing the greenhouse gas emitted and the amount removed from the atmosphere. Let's see what steps Nike has taken to achieve their net zero goals.
Nike's sustainable development goals
Nike acknowledges its eco-responsibility as a global corporation. They strive to create products with minimal climate impact while inspiring positive change within the industry. Here is how the company has aligned its goals with its broader sustainability strategy.
Reducing carbon emissions through renewable energy and energy efficiency
Nike is actively reducing its carbon footprint by
- Improving energy efficiency
- Increasing its use of renewable energy sources
Nike has set the goal of achieving 100% renewable electricity by 2025.
In its 2022 Impact Report, the company highlights how it has achieved a 64% reduction in Scope 1 and 2 emissions since 2020, with 93% of its electricity coming from renewable sources.
By investing in energy-efficient technologies and practices, Nike is working to reduce its energy consumption and associated emissions across its operations. Nike has also piloted energy management systems to monitor real-time energy use and adjust.
Reducing supply chain emissions through sustainable materials and supplier engagement
Nike's focus on reducing supply chain emissions involves:
- Using environmentally preferred materials (EPMs)
- Engaging with suppliers to assist their transition to cleaner electricity
Using environmentally preferred materials (EPMS)
Nike is committed to using more sustainable materials in its products, which can help reduce the environmental impact of its supply chain and contribute to lower Scope 3 emissions.
Nike aims to reduce 0.5M metric tons of GHG emissions by increasing the use of environmentally preferred materials to 50% of all critical materials, such as recycled polyester, recycled rubber, and Flyleather.
- For Footwear EPMs: Use recycled polyester, recycled rubber, and Flyleather, a non-leather substitute for leather.
- For Apparel EPMs: Use sustainable materials like recycled polyester, recycled cotton, organic cotton, and third-party certified cotton.
Engaging with suppliers to support their transition to cleaner electricity
In 2022, Nike began developing a Renewable Electricity Procurement Guide for suppliers and is working with a cross-industry group of multinationals to support capacity building for suppliers across Asia.
Nike also explores policy frameworks to support offsite procurement of renewable electricity across their sourcing regions and encourages suppliers to take advantage of these opportunities.
Stakeholder engagement and partnerships for climate action
Nike actively engages with various stakeholders to drive collective action towards a low-carbon economy. This includes
- Industry and government
- Non-governmental organisations (NGOs)
- Individuals in civil society organisations
- Customers and shareholders
The company has collaborated with USAID's Vietnam Low Emission Energy Program (V-LEEP) to advocate for policy supporting the government's renewable energy DPPA pilot since 2018.
Additionally, Nike engaged in ocean transportation biofuel pilots in 2022 and laid the foundation to scale up its ocean biofuel program in 2023.
Through collaboration with the Clean Energy Investment Accelerator (CEIA), Nike helped facilitate a bundled Renewable Energy Certificate (REC) agreement between Indonesia's state-owned electricity company and local suppliers. This contract allowed them to buy verified and identifiable renewable electricity at a fixed, affordable cost for 10-15 years.
Nike also collaborates with external experts and organisations, such as REI, One Earth, and the Academy for Sustainable Business, to review and improve its sustainability performance.
Nike's time frame for achieving net-zero emissions
Although Nike has set a goal to reach 100% renewable electricity by 2025, its impact report does not mention a specific time frame for achieving net-zero emissions.
Rather than achieving net zero by a specific date, it focuses on tangible goals that move the company towards net zero - starting with a 70% reduction in emissions from Nike-owned and operated facilities.
Strategy in summary: Move to Zero
"Move to Zero" is Nike's journey towards zero carbon and zero waste to help protect the future of the sport. This comprehensive sustainability plan aims to reduce Nike's carbon emissions across its global supply chain and drastically minimise waste production.
This initiative is crucial to sports because climate change impacts the ability to play and enjoy sports due to
- Extreme weather conditions
- Air quality
- The overall health of communities
Nike's commitment to sustainability through "Move to Zero" can help ensure that sports can continue to be a global source of inspiration and healthy competition.
Move to Zero initiatives
- Power owned-and-operated facilities with 100 per cent renewable energy by 2025.
- Reduce carbon emissions across its global supply chain by 30 percent by 2030, in line with the Paris Agreement of 2015.
- Divert 99 percent of all footwear manufacturing waste from landfills.
- Divert over 1 billion single-use plastic bottles annually from landfills to create yarns for new jerseys and uppers for Flyknit shoes.
- The Reuse-A-Shoe and Nike Grind programs convert waste into new products, playgrounds, running tracks and courts.
Measuring and reporting Nike's progress towards net-zero
Nike's progress towards its net-zero goals is measured and reported through various means, including sustainability reports and partnerships with external organisations.
Nike publishes its sustainability performance in annual impact reports, which provide detailed information on the company's environmental, social, and governance (ESG) initiatives. You can find Nike’s latest Impact Report here.
Partnerships and collaborations
As mentioned above, Nike has collaborated with the Clean Energy Investment Accelerator (CEIA) to facilitate a bundled Renewable Energy Certificate (REC) in Indonesia and also worked with USAID in Vietnam towards the Vietnam Low Emission Energy Program (V-LEEP).
Through these efforts and partnerships with external experts and organizations, Nike can track, measure, and report its progress towards achieving its net-zero goals.
Managing climate-related financial risks
Nike plans to assess key climate risks to its workforce in the extended supply chain over the next 10-15 years.
This includes considering risks related to
- Water scarcity
- Clean energy supply
- Grid stability
- Rising temperatures
The assessment will evaluate the impact of climate risks on individual workers' health and productivity, as well as the overall impact on Nike's operations. Factors such as location, gender, and other demographic aspects will be considered, focusing on gender as a crucial dimension.
Specific steps Nike is taking to reduce its greenhouse gas emissions
Nike is actively working on reducing its greenhouse gas emissions through various initiatives and strategies. Specific measures that Nike are implementing are detailed below:
Renewable electricity adoption
93% renewable electricity adoption through onsite solar and wind, power purchase agreements, and unbundled Renewable Energy Credits. Nike aims for 100% renewable electricity by FY25 to reduce Scope 2 emissions.
Environmentally preferred materials
Reducing 0.5M metric tons of GHG emissions by increasing the use of environmentally preferred materials to 50% of all key materials, such as recycled polyester, recycled rubber, and Flyleather.
Nike's ultimate vision is to shift its entire supply chain to a “closed loop” ecosystem. In this ecosystem, old running shoes could be disassembled, recycled into new materials, and used to produce a new pair of running shoes. This would align with the principles of a circular economy.
Energy management systems
Piloted energy management systems to monitor real-time energy use and adjust operations to reduce it.
Electric heavy-duty trucks
Started piloting the use of electric heavy-duty trucks for long-distance outbound deliveries in Belgium, reducing carbon emissions by more than 45% compared to conventional fuel heavy-duty trucks.
Lean manufacturing and waste reduction
Improving the lean 2.0 manufacturing systems to reduce defects and rubber waste, and scaled systems to track the sources and root causes of these waste types.
Freshwater reduction targets
Collaborating with suppliers to establish freshwater reduction targets that will help the company reach its 2025 target.
Implementing activities to reduce, reuse, or recycle and responsibly manage or dispose of waste generated throughout Nike's value chain.
Collaborating with Kirei, an acoustic solutions company, to recycle Nike's upper textile fluff material from finished product waste into their Air Baffle product.
How is Nike supporting its suppliers and customers in achieving net zero?
Nike is actively working with its suppliers and customers to help them reduce their emissions and contribute to the company's net-zero targets.
- Renewable electricity procurement: Nike is developing a Renewable Electricity Procurement Guide for suppliers to support their transition to cleaner electricity. This helps suppliers reduce their emissions by adopting renewable energy sources.
- Capability building: Nike collaborates with a cross-industry group of multinationals to support capacity building for suppliers across Asia, enabling them to implement emissions reduction strategies and technologies.
- Policy frameworks: Nike explores policy frameworks to support offsite procurement of renewable electricity across their sourcing regions and encourages suppliers to take advantage of these opportunities.
Engaging with customers and stakeholders
Nike engages with a broad range of stakeholders, including customers, civil society organisations, industry, and government, to promote awareness and action on climate change and emissions reduction. This ongoing engagement helps build resilience in Nike's operations and supply chain and supports the company's commitment to transitioning to a low-carbon economy.
Nike will engage with policymakers and stakeholders to support the development of policies and regulations that promote emissions reduction and climate action.
Comparing Nike's net-zero strategy with its competitors in retail:
While it is difficult to comprehensively compare Nike's net-zero strategy with all its competitors in the retail sector, we can highlight some key aspects and compare them with a few significant competitors.
Nike's net-zero strategy shares similarities with its competitors in the retail sector, such as adopting renewable energy, investing in sustainable materials, and engaging with suppliers to reduce emissions.
However, specific targets and initiatives are varied, with Nike taking the lead with a carbon reduction goal of 70% in all owned or operated facilities.
Promoting Nike's net-zero strategy to the public
Nike is actively promoting its net-zero strategy to the public through various channels and initiatives. As mentioned above, it actively engages with stakeholders, advocates for policies and has strong collaborations and partnerships, which can reach the public eye.
However, they also publicly share reports about their progress towards net-zero and carry out marketing campaigns promoting Nike’s ‘Move to Zero’.
Public reporting and transparency
Nike shares its progress towards net-zero goals through sustainability reports and case studies, providing transparency on its efforts and achievements in reducing emissions and adopting sustainable practices. By sharing this information openly, Nike keeps the public informed and engaged.
Launched in 2019, Nike began its ‘Move to Zero’ campaign, highlighting its journey toward zero carbon and zero waste to tackle climate change. This logo was branded on shoeboxes, publicly announcing Nike’s commitment to “help protect the future of sport”.
This campaign has continued, with a page dedicated to their 2025 net-zero targets on their website. Their strategy focuses on innovation or “evolving the playbook”. In a 2023 interview, Nike Vice President Darryl Matthews says, “We’re recontextualising what a shoe is”, in reference to sustainable designs that eliminate waste.
Criticisms of Nike’s net-zero goals
Given its public platform, Nike has received criticism and backlash against elements of its net-zero strategy from the public, climate activists and some experts.
An Insider review found that Nike had ‘a mixed record’ with previous environmental and corporate responsibility goals. A representative from Carbon Trust, an organisation supporting businesses towards net zero, commented that there are “systemic issues” which take “collaboration and long-term strategic planning” to be addressed effectively.
Where Nike may have some results in reaching their net-zero goals, in the 2021 report the company’s total emissions had increased more than 15% since the 2015 baseline.
Where reductions are made in some parts of the operations and supply chain, increased emissions may occur in others. Most recently, in the 2022 report, substantial progress was seen for Scope 1 and Scope 2 emissions, while Scope 3 saw an increase in emissions.
This reflects how Nike is striving for a 70% reduction in GHG emissions from owned and operated facilities (Scope 1 & Scope 2), while outsourced facilities may only take their place (Scope 3).
Challenges and solutions for Nike's net-zero goals
Nike faces several challenges in achieving its net-zero goals, including supply chain complexity, technological limitations, and stakeholder engagement. The company is addressing these challenges through various strategies and initiatives.
Impact of Nike's net-zero strategy on day-to-day operations and roles
Nike's net-zero strategy will affect its day-to-day operations and roles in various ways, as the company works towards achieving 100% renewable electricity by 2025 and reducing its overall carbon footprint.
These include everyday things, such as using LED lighting over more energy-intensive options, up to changes in manufacturing materials to include more sustainable options.
Employees' role in Nike's net-zero goals
Employees play a crucial role in helping Nike achieve its net-zero goals.
The members of staff are on the ground making decisions. For instance, those involved in product design and development can choose more sustainable materials, whilst those engaging with suppliers can encourage sustainability efforts.
Here's how Nike engages and empowers its employees in the pursuit of the company's sustainability strategy:
Education and Awareness
In order to mobilise employees to further Nike’s net-zero goals, training and engagement opportunities are offered to staff. These programs help employees understand the importance of their roles in achieving net-zero targets. They share their knowledge and promote sustainability initiatives within their teams and the company.
Employees engage with suppliers to encourage emissions reductions and support their transition to renewable energy sources. They help monitor and report progress towards net-zero goals by tracking relevant performance metrics and sharing results with stakeholders.
Innovation and Ideas
Employees contribute to developing policy frameworks and advocate for climate-friendly policies that support net-zero goals. The company provides platforms for employees to contribute their suggestions and solutions, fostering a culture of continuous improvement and creativity.
Nike employees participate in industry initiatives, collaborations, and policy advocacy efforts to promote sustainability and emissions reduction across the broader business sector. This involvement helps drive collective action and progress towards net-zero targets and other environmental goals.
Measuring Nike's carbon footprint and progress towards net-zero
Nike uses a combination of methodologies and tools to measure its carbon footprint and track progress towards its net-zero goals. To measure its carbon footprint, Nike follows the Greenhouse Gas Protocol, categorising and measuring Scope 1, 2, and 3 emissions. This protocol provides a comprehensive framework for quantifying and reporting greenhouse gas emissions.
In short, Scope 1 emissions are direct emissions from an organisation’s operations whilst Scope 2 are indirect emissions from purchased energy. Scope 3 emissions are the hardest category to track and control as they include indirect greenhouse gas emissions from all other sources (e.g., waste management or materials manufacturing)
Nike has met its Scope 1 and 2 science-based targets (SBTs) several years early, achieving a 71% reduction in emissions in 2022 when compared to 2015. Meanwhile, Scope 3 emissions from Nike have increased by 8% since 2015, while their target is a 30% reduction.
Incorporating climate science into Nike's net-zero strategy
Nike is committed to incorporating the latest climate science into its net-zero strategy to ensure its climate targets and actions are aligned with global goals and scientific recommendations.
Science-Based Targets Initiative (SBTI)
Nike is a member of the Science-Based Targets Initiative (SBTi), which helps companies set ambitious and science-based greenhouse gas reduction targets. By participating in the SBTi, Nike ensures that its net-zero goals align with the latest climate science and the objectives of the Paris Agreement.
Climate research and development
To meet these targets, Nike invests in climate research and development, collaborates with external organisations and experts, and adapts its net-zero strategy based on new insights and developments in climate science. This includes exploring new materials, manufacturing processes, and energy efficiency measures.