Presented by: Charisse A. Caminong MGT110/ BY02 Prof.Quiogue
Company Background Founded by Phil Knight and Bill Bowerman in 1964 Used to be called Blue Ribbon Sports In 1971, they introduced the concept of Goddess of Victory-Nike and in 1972 officially launched the company. Headquarters located in Beaverton, Oregon and employs 36,000 employees globally. Known for the tagline “Just Do It” and their Swoosh logo. Biggest shoe company in the world. http://www.nikebiz.com/company_overview/facts.html
Incidents: Refusal to compensate its workers with fair wages. Continual use of unsanitary and unsafe conditions in its factories. Child labour. Violation of overtime laws. http://ethicalfootprint.wordpress.com/2010/05/10/nike-just-dont-do-it/
Historical Background of the Case By 1990’s, there were already disturbing stories about Nike factories in countries like Vietnam, China and Indonesia. In 1997, workers from Indonesian factories went on strike because of low and unpaid wagesas well as violation of overtime laws. http://www.globalexchange.org/campaigns/sweatshops/nike/faq.html
1998, Chinese workers protest about low wages and dangerous working conditions. Indonesian workers earn $2.46 a day, Vietnamese workers earn $1.60 while Chinese workers earn $1.75 a day. In Vietnam, 1300 workers protest for a raise of one cent per hour. http://www.thirdworldtraveler.com/Boycotts/NikeThird_facts.html
Social Impact Jobs were taken overseas that could be in America which led to controversies and problems for Nike. It is morally unethical to sell shoes worth $150 when the person who made your shoes was only paid a dollar. http://www.mademan.com/mm/how-has-nike-impacted-society.html
Consequences Many people and organizations criticized Nike. Campaigns have been taken up by many including colleges and universities against Nike. Some people are discouraged and started boycotting Nike products because of its bad publicity. A 27% drop in their stock price and slower sales growth. http://www.clrlabor.org/alerts/1997/troubles_add_up_at_nike.html
Personal Insights I think Nike should increase the wages of its workers since the company is earning a lot of money. It should also live up to its social responsibility and start improving the policies of the firm. They should closely monitor the management in their contracted factories to ensure that their workers are not abused.
They should immediately solve problems regarding their company to avoid criticisms from different labour unions and organizations. Nike should always keep in mind that ethics is very important in business because it will affect the perception of the stakeholders. The company should also continue to improve the working place of the employees and regularly check the conditions of the workers in the factories.