from The Wisconsin State Journal , March 12, 2005

Regents approve Adidas contract

by Karen Rivedal

The UW Board of Regents on Friday approved a new sponsorship agreement with Adidas worth more than $1 million a year to UW-Madison, despite concerns that the contract shuts out the public and enables the exploitation of sweatshop labor in overseas subcontractor factories. "Workers' rights are being systematically violated in the name of UW," said UW- Madison student Liana Dalton, a member of the university's labor licensing committee.

Dalton and fellow student Joel Feingold also faulted the six-year agreement for its disclosure terms. Under the contract, Adidas agreed to open its books for university inspection - revealing all wage and business details - but only on the condition that the information remains confidential.

"The university is a public institution," Dalton said. "What the university is informed of should be made public." UW-Madison officials didn't dispute the concerns about sweatshop labor, often characterized by very low wages and poor working conditions, in the worldwide apparel industry.

"This is an exploitative industry," Chancellor John Wiley said, noting that everyone in the Regents' meeting room was probably wearing clothes made in some sweatshop somewhere. "That's scandalous." "But we do the best we can," Wiley added. "We do need to have clothes on the football team and shoes on their feet. This (contract renewal) is as good as it gets."

As to disclosure, university officials said it was not unusual for private companies doing business with the university to withhold their sales and other information for competitive reasons. Even letting top university officials have access to the data - under the Adidas contract, only the chancellor's representatives and, by agreed extension, the UW Board of Regents, can see it - was a huge concession, said Casey Nagy, a top aide to Wiley.

"This is a major step forward for a company of this stature to agree to allow us unrestricted access to its books," he said. "They were quite willing to go along with it as long as (the disclosure) was (only) to the chancellor's office."

Mike Bauer, head of the state Department of Justice's legal services division, said he couldn't comment on whether it would be appropriate under the state's public records law for the university to withhold any information it gathered from Adidas. He said it could require a court challenge to resolve, and he didn't know what side the Justice Department lawyers would be on, depending on who brought a complaint and what the contract's specific "terms and justifications" were. "My guess is this is something we'll see coming across my desk here at some point," Bauer said.

Board President Toby Marcovich said the Regents trusted top administrators to keep tabs on the company, with confidential communication to the board when problems arise. "Adidas is a business and obviously it has to operate and keep trade secrets and financial data as private as it possibly can," Marcovich said. "We have absolute rights of inspection (of company data) and the right to cancel the contract."

The students had wanted public disclosure written into the contract, as well as disclosure of wage and production information to the Workers Rights' Consortium, a nonprofit monitoring organization that the university pays to keep tabs on all of its licensees. The consortium tries to investigate allegations of unfair labor practices and any violations of the university's code of conduct. All university licensees pledge to uphold that code, in which workers must be paid a minimum prevailing wage and be guaranteed certain rights, such as free association.

Adidas wouldn't agree to disclose information to the WRC, Nagy said. But that group and many other human rights organizations still will monitor conditions in factories - like they did before the new contract was signed - and report complaints to the university for investigation. "You have to compromise," said Darrell Bazzell, UW- Madison's vice chancellor for administration. "We think Adidas is as good a partner as we can get."

The contract approved Friday requires Adidas to provide shoes, equipment and uniforms to UW-Madison's 23 intercollegiate athletic teams. That material is worth an estimated $900,000 to $950,000 a year, up from $825,000 in the old contract, in place since 2001. UW-Madison also would be eligible for certain cash bonuses from Adidas depending on how certain teams finish in various tournaments. Possible bonuses range from $275,000 to $400,00 per year, along with royalties from any UW- Madison trademark products that Adidas manufactures and sells. Cash bonuses in the old contract topped out at $250,000 a year. In addition to selling trademark apparel, Adidas would continue to get free advertising in the Kohl Center and Camp Randall and get $65,000 worth of free tickets, parking passes and sponsorship opportunities per year. UW-Madison coaches also would continue to make a limited number of appearances to help promote and sell Adidas products. Regents Jesus Salas, Elizabeth Burmaster, Beth Richlen and Gerard Randall voted against the contract.

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