Nike Outsourcing Essay

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Nike Sweatshop Scandal - Corporate Responsibility Essay - With A Free Essay Review




Since the mid 1990’s Nike has been learning the hard way what it means to be ethical. In the aftermath of the sweatshop scandal Nike is still hard at work to improve its image and be a company that is ethically responsible. Nike learned the hard way that it should have been more responsible about its production. Its motives as a company were egotistical when they should have been more considerate of the people working there. Though there could be arguments that Nike’s actions improved the lives of its poorly treated workers because no matter the conditions, it provided jobs that otherwise would not have existed, this is hardly the case. However, since this scandal in an attempt to improve its image, Nike has worked hard to improve, not only redeeming itself but becoming an industry leader in ethics.

In the mid 1990’s Nike started facing criticism after several articles were released showing the poor labor conditions of its workers in sweatshops in places like China, Japan, and other Asian countries. As early as 1993 reports started being released about the poor working conditions. One such report was a CBS exposé by Roberta Baskin describing the working conditions of the Indonesian women working in the factories, explaining that they were making only $1.30 a day. During the report she criticized Nike and its factories saying things like “To them, ‘Just Do It’ isn’t just a catchy ad slogan” (Baskin). Throughout the mid 1990’s many reports like this followed including two 1996 articles by Life Magazine and the New York Times, each of which also criticized Nike for its sweatshops. Following this exposure, Nike faced severe criticism from labor rights activists about the poor treatment of its workers. After this poor exposure Nike worked to clean up its image. What started out as marketing effort to clean up with image ended up transforming the company into an industry leader in ethical behavior.

Although Nike has made vast efforts to become a better company, their approach was completely wrong. The entire situation should never have happened in the first place. Nike wasn’t the only company that was outsourcing to poor countries for the cheap labor, however they were one of the companies that suffered the most for the poor treatment of their workers. They lost several contracts with colleges because of the poor image had come from this scandal and they had to do massive amounts of public relations in order to get their business back. All of this work could have been avoided if Nike had implemented a corporate responsibility code in the first place. It should not have taken a massive scandal like this in order for action to be taken.

Before the sweatshop scandal happened it was clear that Nike had a moral philosophy that was undoubtedly egoism. The company was simply working to maximize profits, no matter what the cost. An egoist makes decisions in order to maximize his or her own self interest. As a corporation, Nike was working to maximize its own self interest, which was maximizing profits and becoming an industry leader. And it was willing to make this happen no matter what the cost. It didn’t take into account the damage that it was causing to the individuals working for the company, only the company’s profit as a whole. This was a purely selfish motive. Nike should have taken on a utilitarian moral philosophy. A utilitarian moral philosophy is one that provides the most happiness for the most people. Had it followed this philosophy, the entire scandal never would have happened because Nike would have considered its effect as a corporation not only on stockholders and customers, but on all of its shareholders, including its workers and the people living in the environment that it was polluting. After spending years cleaning up its image and implementing corporate responsibility into its practices, Nike has started to show a moral philosophy that looks more like utilitarianism that egoism. But it never should have been different than this. It should have had a utilitarian moral philosophy from the very start.

One argument that can be made for Nike before the scandal is that even though the working conditions for outsourced workers were less than desirable, the sweatshops were still beneficial to the society. This is because Nike came into impoverished societies and provided jobs that otherwise wouldn’t have been available for the citizens of these countries. Which is true. Nike did provide jobs for people that needed them. But not under conditions that were at all desirable. The wages that these people were working for is hardly enough to live off of. Especially for the work that they were doing. With conditions as bad as they were, they should have been making much higher wages. Also, many of the people working were children and teenagers. For some families their only option was to send a child to work because wages were so low that they could not support their family. If Nike had provided fair wages, child labor never would have had to be an option. So although Nike provided jobs for people that otherwise would not have had one, is this really a better option?

After the changes Nike made within the company in order to improve working conditions, it is benefiting its workers way more than it would have when working conditions were poor. Because Nike has worked its way into a better position ethically, especially being an industry leader, one could argue that no more improvements need to be made. However this is not at all the case. Even though Nike has made vast improvements in its ethical treatment of workers, many improvements still need to be made. Recently there was a case exposing a factory in Malaysia for having conditions similar to those in the mid 1990’s scandal (Levenson). Work still needs to be done to improve Nike’s standards even further. With Nike’s standards improved, we can hope that this will cause a snowball effect and cause other companies in the industry to follow suit.

As you can see, Nike learned the hard way that following suit in industry can be incredibly harmful. By outsourcing its work to poor countries and not proving adequate pay for its workers because it was able to get the work done cheap, Nike was exposed in a huge scandal. If it had considered the people working for the company instead of the company as a whole its moral philosophy would have changed from one of egoism to utilitarianism. After undergoing massive amounts of work to change that image and be an ethically responsible company, Nike is finally finding itself in the position it should have been in to begin with. After the negative exposure the company endured and the work it went through to change that image, we must wonder, why didn’t the company strive to be ethically responsible in the first place. Hopefully the hard lesson learned by Nike can be taught to future companies so that they don’t undergo the same hard lesson.

Works Cited

Baskin, Roberta. "JUST DO IT; NIKE CHEAP-LABOR FACTORIES IN INDONESIA." Street Stories. CBS: 02 Jul 1993. Television.

Benson, Daryl. "NIKE: Managing Ethical Missteps--Sweatshops to leadership in Empmloyment Practices." Business Ethics - Ethical Decision Making and Cases. Comp. O.C. Ferrel, Comp. John Fraedrich and Comp. Linda Ferrell. 8th. Mason: Cengage, 2008. 386-96. Print.

Levenson, Eugenia. “Citizen Nike.” Fortune 158.10 (2008): 165-170. Business Source Premier. Web. 10 Nov. 2011

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ESSAY REVIEW

Although I think you could make some marginal improvements to the essay by improving the organization of the essay (for example, why does the paragraph beginning "One argument that can be made for Nike ..." appear where it does?, it completely interrupts the logical development of your argument) or by incorporating more research-based evidence (see the aside below), I am going to concentrate in this review on the substance of the essay, because it's an interesting and complicated problem that you are trying to address.

You claim that Nike, the company, once pursued a philosophy of ethical egoism and has since adopted utilitarianism. I suppose it is possible to think of a company as being like a moral agent that may choose to be an ethical egoist or a utilitarian, but I wonder whether this way of thinking about corporate ethics, however, doesn't simplify things a bit much. If a board of directors is thinking about corporate responsibility at all, then presumably its thinking about a complex of responsibilities that includes responsibilities to shareholders (usually thought to entail the maximizing of profits, and thus roughly equivalent to what you call egoism), to customers, to society (law, the environment, and so on), and to workers. Now a utilitarian approach might entail, as you suggest, trying to make all concerned agents (owners, customers, members of society, workers, and Michael Jordan) happy; but it might also entail making owners, customers, and Michale Jordan happy at the expense of the workers, who get sacrificed for the sake of the presumed greater good. Moreover, a purely egoist company could still act in the interests of workers: if people boycott your products because of your sweatshops, then it makes sense, from a purely selfish point of view, to change the conditions in the factories, and to do so publicly, and to claim to be a leader in corporate responsibility.

(Aside: You assert without evidence or argument that Nike has become a leader in corporate responsibility since the negative publicity in 1990s concerning conditions in the factories in which its products were manufactured. In fact, the one piece of evidence you present concerning the issue is the "case exposing a factory in Malaysia for having conditions similar to those in the mid 1990's." You might want to address this problem).

Now your essay opens by revealing an interest in the question of why Nike started to act more responsibly: "Nike learned the hard way that it should have been more responsible about its production." What you mean by "the hard way" presumably is the negative consequences of acting in a way that society dislikes. On the one hand, it seems to be an implicit claim of your argument here that Nike changed its behavior in response to the hardship it suffered as a consequence of negative publicity. From this point of view, to learn the hard way means something apparently paradoxical: Nike learns that its own interests are best served when it acts in a way not perceived to be purely egoist; or, to put it more bluntly, Nike stops being obviously egoist because that's the right course of action for an egoist. On the other hand, you also claim explicitly that the company did change from being egoist to being utilitarian. The problem, again, is that the change you speak of can be explained as the action of an egoist (in your terms).

Finally, you also claim that Nike _should_ have been utilitarian all along. The difficulties it got into and the trouble it had to go to to get out of those difficulties could all "have been avoided if Nike had implemented a corporate responsibility code in the first place." Again, your argument seems to be at least implicitly twofold. You seem, on the one hand, to invoke at times some kind of absolute ethical principle: Nike just _should_ have acted responsibly. You seem on the other hand to invoke the very principle of ethical egoism that you ostensibly critique: Nike should have acted ethically in order to avoid damage to its self-interest.

I leave you to decide how to address these apparent contradictions.

Best, EJ.

Submitted by: danzgirl73

Tagged...corporate ethics, ethical egoism, utilitarianism, capitalism and ethics, essay writing help



Nike In China Essay

Nike in China

Case study

Word count : 2896

Part A : Ethical Dilemma Essay

According Gasmi and Grelleau (2005), Many multinational companies outsource some of their production activities in countries where ethical standards differ from those in developed countries, which often is the majority of their consumer market. This is particularly the case of multinational producing sporting goods, such as Nike, Reebok and Adidas.

Nike is the multinational leader in the world of sporting goods with 40% market sports shoes in 2000, before Adidas (15.1%) and Reebok (10.9 %). Paul Bowerman and Phil Knight founded the firm in 1964 in the USA under the name Blue Ribbon Sports (BRS). In the early 1970s, BRS began designing his own line of shoes, manufactured by Japanese subcontractors. In 1972, the company achieved a turnover of around $ 2 million and change its original name by the launch of the famous Nike brand. In 1978, due to the macro- economic environment (including the oil crisis) and economic development of Japan, Nike began to look for other countries cost of labour low to manufacture its shoes, as the Indonesia and Thailand , and then it goes to China and Vietnam.

The quote at the beginning illustrates the problems faced by multinational companies that have chosen to outsource in a country other than the ethical standards of their country of origin. Nike was not scandalized by one incident. However, it is a rather comprehensive review of the political subcontracting conducted by Nike in Asia in general and China in particular. Indeed, Nike was criticized by players defending human rights of lacking ethical practices in outsourcing in China. These actors have insisted that Nike does not meet certain international conventions, inter alia, freedom of association, working conditions, forced labour, child labour and wage issues. Why and how multinational Nike has it become the main target, the symbol of unethical behaviour, while the practice of its main competitors (Adidas and Reebok) are often similar? To illustrate, according to an opinion poll conducted in Novethic France in March 2002, Nike was the most cited "unethical" brand (8.7 %), all socio- professional so confused that Adidas has a good picture. The leading position of Nike on the world market, the reputation of its brand and its products, its profitability, visibility allowed actors social advocacy to make a symbol of the lack of ethics and use its market power sports items as leverage...

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