Nike’s Ethical Challenges Essay

You don’t desire your company’s image to be associated with something negative in the worse manner possible. through trade name name association. Many companies strive to make non merely a great image of their company but besides a making a trade name that is specifically memorable of a merchandise such as companies like Scotch ( a 3M merchandise ) and Xerox. The ultimate end of companies is to hold their trade name name be straight associated with a merchandise because it helps make a sense of distinction in the market ( Lerman & A ; Garbarino. 2002 ) .

Using the illustration of Scotch and the term “Scotch Tape. ” we can see how a consumer looking for tape in their local convenience shop would see the assorted tape trade names and notice and retrieve Scotch as a dependable and good known company. What happens when the trade name individuality recalls negative intensions covering with that peculiar organisation? What if Scotch Tape was recalled and it was no now known as a merchandise that helps distribute deathly viruses. This kind of trade name acknowledgment could efficaciously stultify the image a company. in this instance 3M. has been working on for decennaries.

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Though trade name acknowledgment can be largely associated with entirely the name. mottos can be merely every bit of import. Nike’s slogans “Just Do It” is a familiar statement of acknowledgment associated with Nike ( Epstein. 2003 ) . Though a immense plus and association with Nike merchandises. the “Just Do It” slogan began to go an association to a company lost in ethical value. Though many believe Nike to be in the concern of doing places and gym shoe. the production of footwear makes up a really little per centum of Nike’s overall production which besides includes dress ( Locke. Kochan. Romis. & A ; Qin. 2007 ) .

How does a company so big and good known manage to hold an ethical quandary? Harmonizing to Nike. their history started with Phil Knight puting in the thought that he can acquire choice footwear made in Japan to vie with the choice German footwear trade names at the clip ( Nike’s History. 2013 ) . The inquiry truly at manus is. at what cost will Nike guarantee quality? Throughout the 1990’s Nike’s image began to be associated with underpaid workers. child labour and hapless on the job conditions ( Locke. Kochan. Romis. & A ; Qin. 2007 ) .

Though Nike’s production is immensely globalized the bulk of its supply concatenation remains though 100s of independent providers. Whether coming from industries doing parts of their footwear division of anything related to dress. the bulk of production is done through independent mills and companies in Nike’s supply concatenation ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . The inquiry so becomes. does Nike owe any duty for the jobs and issues within those mills?

In the mid 90’s Nike’s response to the accusals of low-paid and child labour to be out of their control since Nike themselves did non pull off or employee the workers and/or mills ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . Nike at that point felt that they had no moral or fiscal duty to the conditions of the mills involved in their supply concatenation since they were specifically providers and non Nike owned premises. This was the beginning of the negative connation associated with Nike’s trade name in the mid-90’s.

The existent inquiry for Nike is whether or there is a societal and ethical duty on their portion to the workers and households employed by the mills. When looking at Nike’s ethical quandary from a useful attack. portion for the teleological theories of moralss. we try to see how society or the stakeholders involved are affected as a whole by Nike’s patterns. If we are to compare Nike’s production issues on its stakeholders. the terminal consequence would demo that there is a negative consequence on Nike’s community of stakeholders while go forthing a positive consequence on Nike’s bottom line.

Each and every determination that an organisation does should be analyzed by the consequence on all parties and if there is a negative result an analysis should be done to see which determination will make the most positive value for everyone. The consequence of lower rewards. child labour and factory safety issues is the larger negative consequence of Nike’s production ( Schilling. 1998 ) . Though these mills are non specifically run by Nike. they are still of import stakeholders in the general strategy of Nike’s production. As Nike’s production begins to increase. so does the negative consequence on the employees of the mills contracted with Nike proportionally.

Henry Ford famously stated that “…any system or state work with low rewards and high prices…the monetary values eat up the rewards and don’t leave anything over. ” explicating that it did non do sense that an employee wasn’t able to afford the merchandise that he/she was making and could hardly populate off the pay itself. This is a direct parallel account of Nike’s quandary in the sense of low rewards where the bottom line comes foremost and the employees can non afford the gym shoes they make. Traveling back to Nike’s response to the ethical state of affairss of its contracted mills. we look at the deontological attack.

To recap. Nike’s attack to the conditions of its supply concatenation partners’ employment conditions was to take no portion as it is non their duty ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . We can somehow link this attack with a similar thought of the Bystander Effect which explains the phenomenon of persons non pursing a struggle because of the premise that person else will assist or is in the procedure of assisting ( Kirwan-Taylor. 2013 ) . Though this is non needfully the direct attack of Nike. the similarity lies in what action taken is the right moral duty of the organisation or the person.

Nike’s actions showed that the right attack was non theirs to take and this is where the quandary starts. On an ethical degree the community. in this instance mill workers. drives your concern and they are merely as a portion of the “Nike Brand” as any other stakeholder in the supply concatenation. Dismissing its ethical duty to take the “right” class of action ended up giving Nike a trade name individuality that is associated with “slave labour. ” paying workers pennies on the dollars and disregarding concerns for safety of the persons who are a portion of doing Nike’s merchandise ( Locke. Kochan. Romis. & A ; Qin. 2007 ) .

Nike’s name changed from a “Just Do It” outlook to a negative 1. Not until the late 90’s did Nike eventually step frontward and necessitate its contracted mills to increase the minimal pay of workers and get down the procedure of repairing what the Nike trade name was supposed to intend ( Laabs. 1998 ) . Prior the 1990’s The United States ( US ) developed administrative bureaus to assist protect workers in the US such as the Occupational Safety and Health Administration ( OSHA ) and ordinances such as the Fair Labor Standards Act ( FLSA ) .

Since these services and regulations became portion of the US anchor. one can come to the decision that American concerns are known for their conformity and just labour criterions. As a community of organisations. there is a fit criterion in topographic point by the authorities of company-employee dealingss and companies rely on the fact that every company will follow the same patterns. As a community. there is a set of virtuousnesss. or virtue moralss. which is seen as a criterion. When a company such as Nike outsources its production to abroad markets it can be seen as an action to avoid certain ordinances and community criterions.

As a community. Nike is the foreigner who is utilizing a loophole. outsourcing and/or outside undertaking. to forestall itself from bearing the duty to its labour community. Ethically talking. Nike is utilizing a backdoor attack to discourage duty while the bulk of the community of American companies are on the right attack to patterns affecting workers. Department of energies Nike have a legal duty? The reply is likely no. nevertheless its patterns are really crystalline in comparing to particularly those makers that are built on the anchor of being “Made in USA.

Though we recognize that Nike does non hold a legal duty. the action for which Nike chose to take in the late 90’s was of an ethical quandary and Nike was good cognizant of it. The issue was non seen as one of ethical duty on Nike’s portion nevertheless because of the bad imperativeness Nike took a inactive response to the state of affairs. Nike required that a codification of behavior be placed in each mill in its supply concatenation to turn to that certain issues should non go on to be and to assist demo that they “care” as an organisation 1000s of stat mis off ( Locke. Kochan. Romis. & A ; Qin. 2007 ) .

This action can outdo be compared to inquiring a colour-blind person to acquire you merely the ruddy or orange M & A ; M’s. Though you in fact interacted with the colour-blind person. there is no virtue to the action because it will make no result. Many persons working in Nike’s supply concatenation are illiterate or minor which will clearly give no positive result of posting marks of how workers should be treated ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . Nike’s Ethical consciousness of the state of affairs is by and large believed to include the simple fact that persons are being employed thereby Nike assisting the community economic systems.

To Nike. the benefit of a salary to the persons outweighs the issues at manus. this being said in response to their deficiency of action. Nike was rather cognizant of the ethical quandary at manus. Their moral logical thinking or judgement is to try a little action that will assist relieve the media attending without giving net incomes. Nike’s current policy is to move as a leader and continuously better in rights of all employees. minimising environmental impact. guaranting a safe and healthy workplace and the wellbeing of their employees ( Hummels & A ; Timmer. 2004 ) .

The strict regulations set upon Nike to its direct employees in the provinces is their lone duty and the statement of their policy can demo to intend that they will travel above and beyond to do certain there is non employment issues. However the quandary at manus that summarizes all the problem that Nike was gotten itself into is sing the contracted employees. Until Nike is able to suit them under the same umbrella of their company policy on employee dealingss. Nike in fact is non pursing the right moral aim.

Though an ethical quandary exists in the usage of underpaid workers. minor workers to maintain costs low. non every position offers the exact same position of what the possible ethical issue is. From a useful attack. Nike’s concern to its contractors offers a big figure of occupations to be created and maintained and Nike taking the attack of traveling its concern back into the US may non be the greater good for the bulk of stakeholders involved.

From the deontological attack. the way of righteousness or the right way is to guarantee quality labour criterion. higher monetary values paid and minimal age demands. which Nike attempted to carry through. to rectify the quandary in topographic point. This last attack may coerce Nike to look to mills elsewhere. topographic points where Nike’s demands can be met go forthing 100s if non 1000s out of work. The issue at manus is which attack is needfully the right 1.

The useful attack comes into struggle with the “righteousness way. ” deontological attack. to this quandary because of the stakeholders involved. Since the employees of these contracted workss make a big bulk of the stakeholders affected by these ethical quandary the useful attack would take a firm stand that anything profiting these people. including allowing things stay as they are so no occupations are lost. would be the right attack. Though on the contrary. the better for the greater good is non needfully the right attack.

An ethical quandary will still be at manus if Nike were to seek to break the labour environment and maintain all the same salvaging 1000s of occupations. Nike has near to over 800 providers around the universe doing up over 500. 000 workers ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . That is a batch of occupations saved. households in developing states able to be fed and heightening local economic systems. Using the righteous attack would coerce all kids workers out of the workplace which may or may non be an indispensable beginning of income for many households.

The right thing to make in this state of affairs is non needfully for the greater good and that is where this struggle comes into drama. Though a big American company like Nike had begun to take right attack towards increasing rewards. necessitating certain age demands in mills and guaranting mills comply with worker safety. their reactive attack to these issues stained the Nike trade name name ( Locke. Kochan. Romis. & A ; Qin. 2007 ) . Nike’s response was non made because of its values for company employees shared through the supply concatenation but because of the recoil of the populace.

You would believe that a company that began in the United States. who has strict employee and universe topographic point safety ordinances. would portion the “home-play advantage” throughout its supply concatenation. Nike’s delayed reaction. about a decennary of ailments subsequently. explained the involuntariness to accept an ethical quandary was at manus. Though there is a stigma with larger makers of engaging sweatshop workers who are on the occupation for long hours. small wage and rough conditions. many makers had preemptively put ordinances into topographic point to guarantee a positive attack to making concern overseas.

Nike’s attack to the state of affairs began in the early 2000’s where at that place began a revelation of mill conditions and worker wage ( Doorey. 2011 ) . Though Nike is non entirely in the state of affairs and is at the same degree as companies like Adidas. Wal-Mart and Levi-Strauss. the policy and actions that an organisation implements is what makes up their trade name acknowledgment. non a motto like “Just Do It. ” One of the toughest moral judgements to do is normally understand the local economic system in a foreign state involved in the fabrication procedure.

Are the low rewards that manufacturers’ mills pay comparative to the local economic system and considered a life pay. or is it a mark of development. There is no statement that the full image is non ever represented to big companies like Nike. such as the issues in Indonesia of child workers forging authorities records to demo that they are of age to work in mills ( Hummels & A ; Timmer. 2004 ) .

Regardless of the issues in guaranting 100 % follow-through of Nike’s ordinances for mills. Nike should take a forward measure in look intoing mill conditions. wages and employment ages of their supply concatenation associates. In the terminal Nike’s trade name image is wholly made up of all the stakeholders involved. from the client who purchases the merchandises to the single overseas who sews the slide fastener onto the Nike jacket. Nike has a duty to all of them. direct employees or non.