Nike Now Uses Recycled Materials In Most Of Its Gear

May 11, 2016, 5:36 PM UTC
Clothes are displayed in the Nike store in Santa Monica
Clothes are displayed in the Nike store in Santa Monica, California, September 25, 2013. NIKE, Inc. plans to release its first quarter fiscal 2014 financial results on Thursday, September 26, 2013. REUTERS/Lucy Nicholson (UNITED STATES - Tags: BUSINESS SPORT) - RTX13ZYJ
Photograph by Lucy Nicholson — Reuters

Nike made a bold vow last year: generate $50 billion in annual sales by 2020, a target that would suggest the world’s largest athletic gear maker would need to expand sales by about 10% each year.

Today, it is setting a slew of new targets: achieve that growth as sustainably as possible.

Nike (NKE) issued a new annual sustainability report that highlights past achievements but also sets new long-term targets. CEO Mark Parker noted that since 2008, Nike’s revenue has soared 64% but it has limited absolute emissions to only 20% growth across manufacturing, logistics and Nike-owned facilities. That means Nike was able to decrease carbon emissions by 19% on a per-unit basis.

Parker also highlighted the use of recycled materials that are being used in 71% of Nike footwear and apparel products, in everything from yarns to basketball shoes.

“We have embraced sustainable innovation as a powerful engine for growth and a catalyst for change,” Parker said in an opening letter of the report.

Here are some of the new targets Nike set:

  • Zero waste from contracted footwear manufacturing sent to landfills by fiscal year 2020.
  • Source 100% of products from contract factories that met the company’s definition of “sustainable.” It is important to note that each company defines that term differently.
  • By the end of fiscal year 2025, achieve 100% usage of renewable energy at Nike-owned and operated facilities. That could include solar, geothermal or wind energy, though it will vary greatly by location depending on what’s most efficient.

Hannah Jones, Nike’s chief sustainability officer, told Fortune that the company looks at sustainability as a way to unlock greater performance from its gear by thinking about manufacturing and design differently.

“This isn’t a sustainability report as much as it is a growth and innovation report,” Jones said. “We see sustainable innovation as a powerful engine for growth.”

An example of this thought would be Nike’s Flyknit innovation, which debuted around the 2012 Summer Olympics. Flyknit – now a $1 billion business for Nike – reduced waste because it features a one-piece upper in the shoe that doesn’t require multiple material cuts that are typically used to build a sports shoe.

Because the Flyknit essentially completely eliminates waste, that technology has reduced Nike’s environmental footprint by some 3.5 million pounds of waste, Jones said.

“Waste is money, waste is time and waste is sustainability,” Jones said. When it comes to the targets Nike set in 2020, she adds that Nike’s team tries to think about future innovations through the lens of “How do we turn waste into an asset?”