AMDP Memo

 

TO:             Professor Clark Hansen, CEO, Anima Mundi Development Partners

FROM:       Ethan Reed 

DATE:        October 3rd, 2020

SUBJECT: Recommendation to Invest in Nike

As a researcher and a strong advocate for AMDP, I believe Nike is a tremendous investment opportunity. Not only is Nike the most valuable fashion brand in the world and the most successful sports corporation, but they also pride themself on doing what is right to better our nation as a whole.

Triple Bottom Line is the idea that companies should prioritize more than just profit/revenue to determine the success of their company. (TBL) suggests that the planet and people are just as vital to a companies success as is profit. This idea demands that companies focus on positively affecting the future of our environment. People, Planet, Profit are the important takeaways from this idea.

Social Enterprise Similar to (TBL), Social Enterprise supports the same claims regarding the prioritization of social success alongside financial success. For startups, this idea integrates its beliefs from the beginning to establish the companies vision.

Corporate Social Responsibility, otherwise known as (CSR), is a business model that self regulates and holds not only themselves to a high standard, but its stakeholders and to the public. This idea is not only significant to its consumers but to companies in general. CSR programs are often used to increase the morale and teamwork of companies.

Carbon Footprint is the amount of carbon dioxide emitted into the atmosphere due to the consumption of fossil fuels by a particular person and or group. This is a significant topic as it plays a major role in the greenhouse effect and is the main focal point when talking about global warming. AMDP emphasizes a low carbon footprint in an effort to protect our environment against global warming in order to have a sustainable future.

About Nike

Nike is the biggest sports corporation ever that sponsors tremendous athletes and promotes a healthy environment through products and advertisement. Whether its commercials about recycling products they use to make clothes or suggestions about the sustainability of our environment, Nike uses its simple but powerful slogan of "Just do it." This slogan is so special because although it seems bland, it expresses just doing the right thing, just doing your best, and just doing what's best for others. In 2016, Nike was crowned at the top of the most valuable fashion brands reeling in brand value of over $28 billion. That is not just sporting brands, that includes major designer brands such as Hermes, Louis Vuitton, etc. 

Why Invest in Nike?

As the CEO of AMDP, it is clear that you pride your company on a high sense of integrity, morals, and care tremendously about the future of our environment. Like yourself, Nike holds itself to an incredibly high standard whether it be their employees, clothing, accessories, or what athletes they sponsor to represent them. This is significant because not only do they rule the fashion and sports world, they prioritize the idea of Triple Bottom Line (TBL). Instead of focusing on just generating massive revenue, they factor in the environment when using recycled polyester on all of their clothing products.

Furthermore, the Brand of Nike is so successful because of the careful consideration with choosing what athletes they want to represent their brand. Nike does not just sponsor the best athletes, but the ones with good morals and demand greatness on and off the court or field. There is no denying that professional athletes are widely known for being some of the most influential people in the world. The platform Nike athletes have and the fanbase they have to be heard is incredible. This is significant when the world sees stars like Lebron James, Tiger Woods, and Christiano Ronaldo talking about the environment in commercials, postgame interviews, or on social media. In addition to this, we see them wearing stylish clothing made out of material that is environment friendly, and are eager to go be like them and wear it. 

Expert Opinions

A 10-year employee described Nike in four words, "Environment, Team, Vision, and Mission." I found this very relative to AMDP and what they expect with their company because it shows the way Nike runs its workforce. Nike displays a true sense of compassion for others whether it is customers or employees and they do it by upholding their high standards. 

Roughly two months ago Nike came out with a commercial called 'You can't stop us'. The message in this commercial Is everything that Nike has always stood for. No matter the race, gender, or status of our country Nike believes that unity and togetherness can overcome any amount of adversity. When you have a culture and history as strong as Nike, there is no limit to the amount of success they can have. Nike truly inspires a greater future whether it is for the environment or people. 

My Recommendation

Considering the standards that AMDP upholds for their company, there is no doubt in my mind that Nike is certainly worth investing in. Nike truly stands alone at the top of their respective field and it does not seem to be changing anytime soon. Nike truly checks every box that AMDP emphasizes greatly which are TBL, CSR, social enterprise, and carbon footprint. In the past year, Nike has accumulated over $41 billion in revenue while the next competitor was Adidas at $25 billion. When you are dealing with Nike, there is a different level of expectation for quality in all facets of the company. Most importantly, "Nike has pressed 650 of its suppliers in 52 countries to develop and implement written environmental policies." (Smart cities). This demonstrates the lengths this billion-dollar company is willing to go to in order to sustain a quality future for our planet

Citations

https://www.smartcitiesdive.com/ex/sustainablecitiescollective/9-companies-great-environmental-initiatives/1193165/

https://fashionunited.com/i/most-valuable-fashion-brands

https://news.nike.com/news/nike-inc-reports-fiscal-2020-fourth-quarter-and-full-year-results

https://www.fool.com/investing/2020/04/07/why-nikes-global-success-is-changing-retail.aspx