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Responding to charges that it exploits workers in its Asian factories, sports apparel giant Nike announced a series of changes in its labor practices. Following a background report, Phil Ponce talks with Nike CEO Phil Knight about the company's new policy. Also, continue the discussion in an Online Forum with Mr. Phil Knight.

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A RealAudio version of this segment is available. NEWSHOUR LINKS: May 13, 1998: A discussion with Nike CEO Phil Knight. Online Forum Nike CEO Phil Knight takes your questions. February 3, 1998: Exploring the impact of Asia's economic crisis on the U.S. April 14, 1997: President Clinton announces efforts to eliminate sweatshops worldwide. July 16, 1996: A discussion on sweatshops, both here and abroad. Browse the NewsHour's coverage of business economy and Asia. OUTSIDE LINKS Nike's page on labor practices. The National Labor Committee, an advocacy group for worker rights.

PHIL PONCE: It is one of the most recognized symbols in the world--the Nike swoosh. The emblem is found on billboards, television, and in clothing and sporting goods stores around the world. Athletes like Michael Jordan and Tiger Woods appear in commercials and are paid millions to wear the swoosh whenever they compete. The creator of this multi-billion dollar sports empire is Philip Knight. Knight started Nike in 1964 just outside of Portland, Oregon. After 34 years in business, it's the Number one athletic shoe maker in the United States and the world.

Nike under fire.

But Nike has come under growing fire for the way it makes its products. Human rights monitoring groups have accused the company of exploiting workers in its Asian factories. Nike has subcontracted the labor intensive work to factories in China, Vietnam, Thailand, and Pakistan, where workers' wages can, depending on the country, average about $1.84 a day. Critics charge that workers as young as fourteen often are the ones making shoes, which can sell for more than $100 back in the United States. They've also accused Nike factories of making employees work mandatory overtime and subjecting them to unsafe working conditions. The charges have been a public relations disaster for the company. Cartoonist Gary Trudeau, for example, has repeatedly poked pointed humor at Nike in his Doonesbury cartoon. And film maker Michael Moore targeted Nike in his new film, "The Big One."

MICHAEL MOORE: I've got a little gift for you. I've got here two tickets, one in my name and one in your name, for you and I to go to Indonesia together. All right. And you show me the factories, you explain this to me, right? I'll show you what's going on.

PHILIP KNIGHT: What's the date on those tickets?

MICHAEL MOORE: Sunday.

PHIL PONCE: The bad publicity has spilled over into other arenas as well. Some university officials and student groups have criticized Nike's payments to college athletic departments so that athletes will wear Nike shoes and clothing. And the company is under increasing financial pressure. After years of tremendous growth, sales and profits are off. Yesterday, CEO Philip Knight publicly addressed the riticism in a Washington speech..

PHILIP KNIGHT, CEO, Nike Inc.: One columnist said Nike represents not only everything that's wrong with sports but everything that's wrong with the world. So I figured that I'd just come out and let you journalists have a look at the great Satan up close and personal.

Nike's "major changes."

PHIL PONCE: Knight proposed what he called "major changes" to Nike's overseas operations. It will now require new shoe workers to be 18 or older, make factories safer according to U.S. standards, and independent monitoring of factories by non-government organizations, and provide free middle and high school equivalency courses at their factories during off hours. Some of Nike's critics say the proposals are fine--as far as they go.

JEFF BALLINGER, Human Rights Activist: But it seems they responded to the pressure built up over many years and it's very good news for these workers in Indonesia and Vietnam and China, especially the ones that are exposed to these toxic chemicals because the statement yesterday was very specific about what they're going to do about using OSHA standards and a timetable for implementation and a little less movement on the independent monitoring front. But we really feel like that's an important issue that at least they've addressed, and it shows that up till now they hadn't really quelled their critics because they haven't fixed the things that are bothering us.

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