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Just Did It

Just Did It
December 17, 2009

It’s an unlikely story, particularly at the University of Washington.

On a campus that has been a hotbed of student protests against Nike’s labor practices, Provost Phyllis Wise’s recent decision to join the company’s board of directors has been met with a mix of anger, consternation and some degree of hope. While protesters are understandably concerned that Wise has literally gotten on board with one of their least favorite corporations, there are some who buy Wise’s argument that she can be a force for change in her new position.

“It’s really important for higher education to have a place at the table, because I think we can learn and we can influence better,” Wise said.

Wise says she plans to join Nike’s Corporate Responsibility Committee, which is charged with advising the company on labor and environmental issues. But when asked whether the company saw improving labor practices as part of Wise’s role on the board, Nike officials refused to comment.

Wise won’t be the first college administrator to serve on Nike’s board. Jill Ker Conway, former president of Smith College, has served on the board since 1987. For two of those years, Conway was still president of Smith, and she is now a visiting scholar at the Massachusetts Institute of Technology.

Wise’s decision to join Nike places a second high-level Washington decision maker on the board, whose stated responsibilities include “optimizing long-term financial returns” and ensuring that the company operates in a “legal and ethically responsible manner.” Orin Smith, who has served on Nike’s board since 2004, was named a Washington regent this month by Gov. Chris Gregoire. Smith is former chief executive officer of Starbucks Corporation.

Photo: University of Washington

Phyllis Wise, provost at the University of Washington, will join a university regent as a Nike board member.

For critics who have pressured Washington to sever ties with Nike over the company’s labor practices, Wise's addition to the board raises troubling questions. Would Washington take a hard line with Nike when the university’s provost and regent are so closely aligned with the company's interests? That question may be answered soon, according to Rod Palmquist, a Washington graduate who protested the university’s recent contract negotiations with Nike. Concerned about labor practices, a committee of student, faculty and staff has called on UW President Mark Emmert to find Nike in violation of the university’s code of conduct for licensees, and Emmert’s response will be telling, Palmquist said.

“If President Emmert [took a tough position] and the university terminated its license agreement that would go a long way to demonstrating this [board appointment] isn’t a conflict,” said Palmquist, who now serves as the international campaigns coordinator for United Students Against Sweatshops.

To allay concerns about conflicts of interest, Wise has formally recused herself from all matters that come before Washington's administrators involving Nike or its competitors. Wise said that any previous negotiations with Nike fell outside of her purview as provost anyway, but she recused herself to avoid any appearance of a conflict.

As provost, however, it would be difficult if not impossible for Wise to divorce herself from matters that might affect Nike – however tangentially, according to Stephen Schwartz, a professor of pathology. While Wise does not have a role in overseeing athletics, she is responsible for the institutional review board, which has veto authority on any experiment involving human subjects. With an active sports medicine program, it’s not difficult to imagine the board evaluating research that could help or harm Nike, Schwartz said.

“Suppose somebody in sports medicine or rehab medicine wanted to approach the issue of injuries to football players,” he said. “How does she not get involved in that? She is literally the person in charge of that. I don’t see how she can exempt herself.”

Schwartz has argued that Wise, who holds a faculty appointment in the medical school, skirted medical school policy by not seeking permission from the school before joining the board. Washington officials, however, say she appropriately consulted the president, to whom she reports.

Nike Deal Sparked Protest

Washington signed a 10-year deal with Nike effective July 1, making the company the official provider of athletic gear for the university. The deal is worth a guaranteed $35 million to the university's athletics program, but could reach $39 million with incentives.

As the Nike deal was being hammered out, members of Washington’s USAS chapter, the Student Labor Action Project, rose up in opposition. The group’s protests continued after the university’s Advisory Committee on Trademarks and Licensing suggested that Nike be put on notice for conduct code violations. At issue is the treatment of workers at two Honduran factories that have supplied Nike. The Worker Rights Consortium, which counts Washington among its member universities, found that the factories closed without paying workers who were legally mandated severance of more than $2 million.

Relations with Nike would not automatically be severed if Emmert declared a conduct code violation, but doing so would trigger a process that could ultimately end with such a separation, according to Margaret Levi, co-chair of Washington’s advisory committee.

Photo: University of Washington Student Labor Action Project (SLAP)

Members of the University of Washington's Student Labor Action Project have protested numerous labor issues, including the university's contract with Nike.

“There is a period for taking corrective action. I’m sure at the least that’s what’s going to happen," said Levi, a professor of international studies. "The president is very unlikely to say ‘We’re ending our economic relationship with Nike as of today.’ I know he won’t do that. But he’ll do something that requires them to respond. He feels very disturbed by Nike’s inaction on this issue, and is keen to see them responsive.”

In a statement, Nike officials said the company had been in discussions with the two Honduran subcontractors -- VisionTex and Hugger -- to “encourage continued dialogue to reach a resolution regarding severance.”

“Nike believes that factories which directly employ workers are responsible for ensuring that their employees receive correct entitlements,” the statement reads.

Unlike some critics, Levi said she does not believe Wise’s presence on the Nike board will temper the university’s response on labor issues.

“I just don’t see it playing out that way, where the UW would feel somehow because she’s on the board it can’t do what it needs to do in terms of its contractual relationships with Nike,” she said. “I think the bigger issue is the fact that we have this huge team sports contract. That’s a greater dependency than having her on the board. They supply million of dollars of uniforms, equipment and scholarships.”

Provost Pressed to Donate Compensation

At a time when Washington is undergoing budget cuts, some argue that Wise’s affiliation with a high-paying corporate board doesn’t help appearances. Already collecting $535,000 in salary and benefits at Washington, Wise will make a minimum of $60,000 if she attends all five annual board meetings. She’ll also collect an additional $1,000 for each committee meeting she attends, and board members currently serve on anywhere from one to three committees. Board members are also entitled to stock options, which helps explain why Nike directors each received between $132,000 and $217,000 in total compensation during the 2009 fiscal year, according to company filings.

At least one state lawmaker has publicly called on Wise to donate her Nike earnings to the university, arguing that her seat on the board is directly attributable to her position at a public institution. State Rep. Reuven Carlyle, a Democrat who represents Seattle, wrote on his blog that Wise should give 90 percent of her compensation to Washington, specifically suggesting she support a campus human rights center he helped create.

“This move by the Provost, while made sincerely and with only the best of intentions, is not helpful in our larger efforts to convince our colleagues that our institutions of higher education need more support, and local control, not less,” Carlyle wrote. “She is in the middle of perfect storm of perception. During normal times, perhaps this would not be an issue, but we don’t live in normal times. And the fact is the public simply cannot understand why a public servant should benefit so handsomely from an appointment to a private board."

If Wise has plans to make a donation, she’s not stating it publicly.

“The bottom line is I really believe that philanthropy is a personal issue, and I want to protect my privacy,” she said.

And there’s one more matter she’s staying silent on as well. Should Tiger Woods retain his Nike sponsorship? No comment.

 

 

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