Canada Investigates Nike and Dynasty Gold for Alleged Uyghur Forced Labor

(Patria) - Canada's ethics watchdog has launched an investigation into allegations that Nike Canada and gold mining company Dynasty Gold benefited from Uyghur forced labor in their operations in China.

The watchdog's investigations stem from complaints filed by a coalition of human rights groups, the BBC reported.

Nike says it no longer has ties to companies accused of using Uyghur forced labor. Dynasty Gold says these accusations emerged after they left the region.

A 2022 United Nations report found that China had committed "serious human rights violations" against the Uyghurs, an ethnic Muslim minority living in the Xinjiang region, which "may constitute international crimes, in particular crimes against humanity." Beijing denies the accusations.

This is the first such investigation announced by Canada's Office of the Extractive Sector Corporate Social Responsibility Counsellor (CSR Counsellor) since it launched its complaints mechanism in 2021.
The agency states that Nike Canada Corp has supply relationships with several Chinese companies that an Australian think tank identified as using or benefiting from Uyghur forced labor. The research center, the Australian Strategic Policy Institute (ASPI), published a report in 2020 estimating that over 80,000 Uyghurs had been transferred to work in factories across
China.

The report states that the company has not taken "any concrete steps to ensure beyond reasonable doubt that forced labor is not included in their supply chain".

Nike says it no longer has ties to these companies and has provided information about their deep analysis practices.

According to the report, Nike declined meetings with the counsellor but sent a letter stating, "We are concerned by reports of forced labor in the Xinjiang Uyghur Autonomous Region (XUAR) and its connection to it".

"Nike does not source products from the XUAR, and we have confirmed with our contract suppliers that they do not use textiles or spun yarn from the region".

The report on Dynasty Gold suggests that the company benefited from the use of Uyghur forced labor at a mine in China in which the gold mining company holds a majority stake.

The mining company says it does not have operational control over the mine and that these accusations emerged after they left the region.

The ethical watchdog has a mandate to hold Canadian garment, mining, and oil and gas companies operating abroad accountable for potential human rights violations arising from their overseas operations, including their supply chains.