Nike Company is considered as one of the classic world wide corporations established in America. Its fame is also associated to the superfluous profits that the company makes out of the large volumes of shoes that it produces. Nike Company has been able to propagate its revenues from the fact that its sells its products from more than 140 countries worldwide.
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Despite of the company being able to generate profound profits out of the large volumes from the apparels and shoes, it is being characterized by some features that may in one way or another be perceived as unethical.
Some of the issues that the company ought to keenly observe comprise of the working condition of the employees. In essence the working condition may comprise of the remuneration to its respective employees and the conditions that the company dictates to its subcontractors (Hill, 2009).
Nike being termed as the best performing corporation on a global sense in terms of the apparels and shoes it is able to produce in an annual basis. This means that it is being able to control the market. In other words, the company has been able to set up and establish the conditions that ought to be followed by other marketers, live alone its subcontractors.
Considering the amount of remuneration that the company offers to its employees and the conditions that it has set up to even the foreign factories that it works with, it would be just if the company is held responsible for such conditions.
As long as the subcontractors make products for Nike Company, the foreign countries associated with the subcontractors in one way or another are being controlled by Nike Company. Therefore, the conditions that those foreign companies implemented are indirectly linked to Nike Company and thus, this justifies why Nike Company ought to be held responsible for any condition within the foreign company (Hill, 2009).
Though, Nike may be held responsible for the conditions subsisting in foreign countries, which might be regarded as being unethical, there are others that ought to be held both in the mother country and in the foreign countries. Some of the working conditions that should be upheld in the foreign countries are the issues concerning the overtime rates. In order to have a livable wage, there should be no limit for the overtime. In essence it should not be limited in any way (Bateman & Snell, 2009).
It would be justified to criticize Nike Company for the low wages it provides to the subcontractors residing in Indonesia. Considering the high standard of living – constituted to the amount of work done by the subcontractors – at least Nike Company should be advocating for the minimum age, but for an increment in total wages.
Also, considering the amount of profits the company generates, a little increase will be considerable. In view of the way Nike retaliated to the negativity publicity about the sweatshops by promising to improve the working conditions and also amending the labor rule and regulations, it was not a better way forward.
The negative publicity would still hold as long as those products would remain produced from the “sweatshops” Additionally, considering that the company is aimed at offering quality products to its clients, changing the brand name of the production site (sweatshop) would in one way initiate a positive insight in people’s mind.
A pay rise is another factor that would be considered as an improvement in the working conditions. Furthermore, cutting links with other factories that could follow up their rules could not help improve the working conditions. Instead amending the rules to strengthen the bond could be a way out in improving the conditions.
There is therefore a dire need for the company to improve the working conditions within its strategy. For instance, the company should consider a pay rise that should conform to the current living standard. Additionally, the company should not be dictatorial on the quantity of products that a single person ought to produce to be eligible for payment.
Overtime rates should be limited by any law, but instead, should be open as long as somebody is ready to work. Nike, being a global corporation, should work independently and not focus much on being profit oriented, but also consider the welfare of its employees (Mejia, Balkin, & Cardy, 2006).
In this regard, the reputation of a business is not built by the amount of profits that the business generates; neither by volume of production, but by how well the business treats its employees and the public at large. Nike Company should be guided by such motives and thus, there will be a right to argue that WRC has a right to argue that the FLA is a tool of industry.
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If Nike does not make any adjustments to the working conditions, and assuming that all the challenges stems out from the “Sweatshop”, the issue may turn into a global problem and the global solution is closing down the company. Therefore, global managers should ensure that there is enough marketing research within their target markets before deciding on the products and services to offer.
Bateman, T.S & Snell, S.A. (2009). Management: Leading and Collaborating in the Competitive World (8th ed.). New York: The McGraw-Hill Companies.
Hill, C. W. (2009). International business. Competing in the Global Marketplace (7th ed). Boston, MA: McGraw-Hill.
Mejia, L. G., Balkin, D. B. & Cardy L. R. (2006). Management: People, Performance, Change. New York: McGraw-Hill.