We are making progress in assessing and understanding our overall water footprint, which helps us to identify impacts across our value chain. Though we have targeted improvements in water efficiency for manufacturing and materials processing, we recognize that efficiency is not the only relevant measure. Water quality, water security and access to water and sanitation also impact our supply chain and our business, affecting everything from the availability of raw materials to the health and well-being of workers and their communities.
Our recent footprinting work revealed that the vast majority – 73% – of the water needed to create our products is used at the beginning of our value chain, in the raw materials stage. Why? Cotton, mostly. Cotton is very water-intensive to grow; it is responsible for 87% of all water used in the raw materials stage.
Though it is difficult for us to influence water-use practices far upstream in our supply chain, like growing cotton, we can help our product creation teams make more water-efficient design choices using the NIKE Materials Sustainability Index (NIKE MSI). In the NIKE MSI, water-efficient materials from water-efficient vendors are more favorably rated; they therefore stand a better chance of being selected by our designers than other materials. We are also working to improve the water quality and quantity profile of specific materials – for example, through the Better Cotton Initiative (BCI).
Our footprinting process also showed that the consumer-use phase – i.e., the washing of garments – has the second-highest water use in our value chain. The two remaining areas with significant water use are materials manufacturing and finished goods manufacturing. In these two areas – where we have more influence to make improvements – we have set targets and are making progress.
Water Use in Footwear Manufacturing
Footwear manufacturing is where we have seen the greatest efficiency gains. By the end of FY13, our contract footwear factories had reduced their water use by 23% per pair compared to the FY11 baseline, meaning we achieved our 15% per-pair reduction target two years ahead of schedule. These factories saw an absolute (not just per-pair) reduction in water consumption over this time period – dropping from an estimated 3.5 billion gallons used in FY11 to 2.7 billion gallons in FY13, despite a nearly 20% increase in production.
This progress has been achieved through a combination of NIKE field team and contract factory-led efforts, including initiatives to help factories improve metering and data analysis to reduce leaks; repurpose treated “gray water” (i.e., minimally contaminated water suitable to replace fresh water in certain applications); set standards for water-consuming processes such as cleaning; and reduce flow rates. We have also worked hard to communicate to factories that water is one of the metrics we track in our Sustainable Manufacturing & Sourcing Index to evaluate performance and make sourcing selection decisions.
The push to reduce water use has also inspired green technology innovation. For example, many factories have developed and implemented mid-sole washing processes that recycle and extend the life of water through a three-step filtration process.
Water Use in Materials Processing
We have also seen progress toward our other efficiency target – for water used by our apparel dyeing and finishing vendors. This water efficiency improved by nearly 10% per unit from FY11 through FY13. Although we have not routinely audited material supplier facilities for water efficiency, as we have in footwear manufacturing, we have provided training on the areas we score, including water, in the NIKE MSI. We anticipate increasing our outreach to vendors in the coming years in support of this water efficiency improvement goal.
We are also seeking out and testing new innovations for reducing water use – such as the waterless textile dyeing machines developed by DyeCoo Textile Systems B.V. These machines use recycled carbon dioxide instead of water in the dyeing process, which has the potential to significantly cut water use in this stage of our value chain (see infographic).
In FY13, 793 material vendors and contract factories tracked and reported their water use and discharge to the NIKE Water Program. Of 260 facilities discharging more than 50m3/day in FY13, 48% met NIKE water quality guidelines (which require compliance with all local regulations and NIKE guidelines, whichever are more stringent), and another 47% were compliant with local regulations. The remaining 5% needed improvement. The higher percentage needing improvement in FY13 (compared with the 1% noted in our FY10/11 report) is due to the expansion of the NIKE Water Program beyond apparel material vendors to include footwear materials suppliers for the first time.
In our contract finished goods factories that make apparel and equipment, we are still putting procedures in place to accurately track water use. At the same time, we have been working with these factories to improve water efficiency. For instance, we selected a number of apparel contract factories that do materials processing, dyeing and finishing for targeted consulting from NIKE field team representatives; these factories increased their water efficiency by 26% from FY11 through FY13. This progress has been due to the implementation of more efficient dyeing machines, better cooling towers, closed-loop systems for recovering steam, water-efficient toilets, and foot paddles instead of screw or lever taps on sinks to reduce excess water use.
Understanding the Geographic Context
Our understanding of the supply chain and the system in which our suppliers operate is continuously improving. Diverse types of suppliers and the varied local conditions they face demand unique solutions, collaboration and expertise both inside and beyond the contract factory to become cleaner, more efficient and more resilient water users.
We continue to improve our understanding of our impacts by assessing our supply chain against country- and basin-level water risk data, acknowledging that country-level information is not as important or valuable as that by basin. Additional assessments of urban infrastructure, number of workers and population demographics, and other factors contributing to overall water stress will provide greater insight. In the meantime, water risk is included in our Country Risk Index which is part of our sourcing assessment through the Manufacturing Index.