In the name of business – and maybe verbal reparations – Nike CEO John Donahoe labeled his company “a brand of China and for China” during an earnings call.
Nike had earlier this year been among the U.S.-based companies to voice concerns about the Chinese government’s human rights abuses.
Donahoe made it clear that the sportswear behemoth, “the largest sports brand there,” intends to continue with its major operations in China, where it’s done business for 40 years.
“The biggest asset we have in China is the consumer equity,” Donahoe said. “Consumers feel a strong, deep connection to the Nike, Jordan and Converse brands in China. And it’s real.”
Any concerns about its recent revenues were sent sprinting away with a “swoosh,” as Nike reported better than expected numbers for its fiscal fourth quarter.
Subsequently, shares of Nike hit record highs on Friday, rising 15.53 percent to close at 154.35 per share.
The Greater China sales-growth numbers, however, were lower than those expected by Wall Street analysts, who predicted revenues of $2.25 billion; the actual growth was 17 percent, to $1.93 billion.
Nike’s part in the China controversy was came from comments to customers that Nike does not source textiles – such as cotton — or other products from the Xinjiang Uyghur Autonomous Region (XUAR), where concerns about forced labor were focused.
The situation resulted in Chinese consumers voicing a push to boycott the brand – as well as others such as H&M.
The Chinese government accused Western businesses’ cotton boycott as an effort to damage its economy.
U.S. companies including Apple have been targeted for criticism because they are said to be altering their rules when operating under the eye of the Chinese communist government.