‘It’s a more sensitive environment, so there are occasions when we’ve decided to pull our product and services from the market…’
(Liberty Headlines) Athletic apparel company Nike said Tuesday that longtime CEO Mark Parker was stepping down early next year following public controversies that included insulting the American flag and pandering to other politically charged issues.
Parker will be replaced in January 2020 by board member John Donahoe, who formerly ran e-commerce company eBay. Parker will become executive chairman of the board.
It was not immediately clear whether the company’s left-wing virtue-signaling and the resulting boycotts played a part in pressuring his departure after a 13-year tenure.
Several media sources suggested it was related to a more sports-specific scandal—Parker’s support for a track coach recently implicated in a doping investigation.
Parker denied any connection between the scandals and his resignation. However, conservative free-market groups like the National Center for Public Policy Research had recently called for his ouster during the company’s annual shareholder meeting in September.
Nike’s sales have been on the rise as the company focuses on selling more of its swoosh-branded sneakers online and on its apps. The company’s first-quarter earnings last month soared past expectations.
However, much of the growth was tied to Chinese markets, which far outpaced the 4 percent rise in U.S. sales. The long-term impacts of the company’s reliance on polarizing pitch-people like former NFL quarterback Colin Kaepernick and tennis player Serena Williams remained uncertain.
Both social-justice warriors have been vocal critics of U.S. culture while advocating for extreme positions on race and gender issues, including Kaepernick’s highly publicized kneeling protest of the national anthem in his last NFL season.
In June, Nike pulled a shoe that incorporated into its design the 13-star Betsy Ross flag, the first official flag for the United States, after Kaepernick insisted that the flag was associated with slavery.
The Air Max 1 USA shoes would have been released on July 4, 2019 to commemorate America’s Declaration of Independence.
Kaepernick’s outrage stunt worked well for Nike, and the company stacked $3 billion in stock gains after he slandered the patriotic symbol, The Denver Post reported.
Parker claimed that pulling the shoes from shelves would bolster the Fourth of July, rather than “detract” from it, according to FootWearNews.
“It’s a more sensitive environment, so there are occasions when we’ve decided to pull our product and services from the market,” Parker said, bowing to pressure from the always-offended Twittersphere.
“The decision [regarding] that Air Max product was based on concerns that it could unintentionally offend and detract from the Fourth of July holiday,” he continued. “That’s the reason we pulled it—not to create a source of polarization. We make those decisions sometimes. They’re rare, but it does happen. We’re trying not to offend.”
However, it wasn’t the first time Nike had stumbled into doing precisely that by injecting its political views into hot-button issues.
The bill, which came in response to the city of Charlotte attempting to pass an ordinance mandating transgender bathrooms, allowed the state to supersede the municipal regulations and affirm privacy protections based on a person’s biologically-assigned gender.
Facing public pressure, the state legislators ultimately replaced the law with a scaled-down version.
Parker also faced backlash from a recent doping controversy surrounding renowned track coach Alberto Salazar.
Three weeks ago, Salazar was banned from the sport for four years by the U.S. Anti-Doping Agency for running experiments with supplements and testosterone that were bankrolled and supported by Nike, along with possessing and trafficking testosterone.
In the wake of the scandal, Nike quietly announced that it was shutting down its elite Oregon Project track-and-field program, which was overseen by Salazar.
However, Parker said in a TV interview with CNBC Tuesday that the scandal had “absolutely nothing” with him leaving the top job and that succession plans have been months in the making.
“This is not something that happens in a matter of weeks,” he said.
Last year, allegations of misconduct and gender discrimination led to a leadership shakeup at the company. And earlier this spring, Nike announced changes to its contract policies after The New York Times published opinion articles and videos from female runners saying they risked losing pay if they became pregnant.
Parker, who joined the company in 1979 as a footwear designer, has been CEO since 2006. In 2017, he took a 70-percent compensation cut after a rough year for U.S. sales and the company’s stock price.
The Beaverton, Oregon-based sneaker seller said Donahue will step in as CEO on Jan. 13. Donahoe is the current president and CEO of ServiceNow, an information technology and software company.
“He really clicks a lot of the boxes that we’re looking for,” Parker said in the TV interview.
Nike’s rival Under Armour will also have a new leader in the new year. On the same day Nike made its announcement, Under Armour said founder Kevin Plank will step aside as CEO in January and be replaced by Chief Operating Officer Patrik Frisk.
Adapted from reporting by the Associated Press and Liberty Headlines’ Joshua Paladino.