Nike is among the most popular sportswear company in the world. However, its reputation has been questioned due to accusations of engaging in unethical behavior in its manufacturing process. In the case study “Nike: Sweatshops and Business Ethics,” Nike is blamed for using sweatshops to make its products. Even though Nike outsources most manufacturing processes, it is accused of reaping huge profits from workers toiling under hazardous work conditions for below the minimum wage pay (Hill, n. d.). Thus, examples of ethical behaviors within Nike include allowing its products to be manufactured in sweatshops, poor working conditions, low pay, and child labor.
Moreover, Nike outsourced the manufacturing work to companies in developing countries where workers were taken advantage of due to poverty. For instance, workers in a Nike factory in Vietnam were paid only $40 per month after working six days a week (Hill, n. d.). In another factory in southern China, workers were not allowed to talk, and if they did, they were fined. The company also hired workers as young as thirteen years and paid them exceedingly below the minimum wage.
Nonetheless, Nike can ensure ethical considerations within the organization by taking four important steps. Firstly, Nike must communicate standards and procedures to ensure everyone adheres to the expected behavior. Secondly, the company should train and educate its employees to enhance compliance with ethical behavior. Thirdly, Nike has to audit and monitor work conditions closely. Lastly, Nike must address allegations through thorough investigation and inquiry.
Regarding governance mechanisms, Nike needs to prioritize social and economic justice. That can be done by sharing the huge profits with employees by paying well and ensuring favorable working conditions. Additionally, Nike must hold all the auxiliary companies accountable for any complaints regarding ethical behavior. Therefore, Nike should develop strict guidelines on minimum pay and working conditions for its employees.
Reference
Hill, W. L. (n. d.). Nike: Sweatshops and business ethics. Case study 31. University of Washington [PDF).