On Sept. 13, Cornell University President David Skorton severed the university's business relationship with the global sports clothing manufacturer adidas, which had been licensed to produce and sell apparel bearing Cornell names and marks since 2006.
The decision is a result of adidas' refusal to contribute to the severance due displaced workers at a closed Indonesian factory that produced apparel for the company. Cornell's codes of conduct hold licensees responsible for the legally mandated benefits of their contractors and subcontractors should the contractors and subcontractors fail to provide benefits themselves.
In a letter to adidas' licensing manager, Skorton wrote: "Having followed with great concern the severance issues surrounding the closure of the PT Kizone factory in Indonesia in September 2010, and reviewed adidas's position on its severance responsibilities, as well as reviewed the findings of the Worker Rights Consortium, I am writing to inform you that Cornell University is severing its business relationship with adidas effective October 1, 2012. We have notified the Collegiate Licensing Company of our decision.
"We believe that severance is a basic worker's right, as is a living wage, freedom of association and safe working conditions. We are calling on the collegiate apparel industry to develop mechanisms whereby brands can be assured that the factories with which they do business have on hand sufficient and secured funds to pay workers what they are owed should a factory close. This gap in the apparel industry's approach to worker rights is a critical issue that demands immediate attention."
Skorton also announced that Cornell will become the second university to participate in the Designated Suppliers Program, which would direct collegiate apparel manufacturing to factories that pay a living wage and respect workers' rights. "The university has been a leader in advocating for worker rights and we see this as a significant step in eliminating sweatshop conditions from collegiate supply chains," Skorton said.
The university ended its licensing agreement with Russell Athletic in 2009 when the firm closed two factories in Honduras at which workers had attempted to unionize; when the factories were reopened and the workers rehired, the university renewed its agreement with the company. In 2010, Cornell threatened to allow its agreement with Nike expire when the company failed to pay severance to workers at two other Honduran factories that closed, again renewing the agreement when the workers were paid. Nike and its agent, Green Textile, have contributed more than $1.5 million to the displaced workers in Indonesia.
"We are terribly disappointed that adidas has refused to honor the terms it agreed to follow as a Cornell licensee," said Mike Powers, senior director for University Communications and chair of Cornell's Licensing Oversight Committee. "We hope they will follow the examples set by Nike and Russell and become a leader in respecting worker rights rather than continuing to deny their responsibilities."