CASE STUDY Mini case Niki sweatshop LaborBack groundNiki is a Multinational company of USA. It is founded by Phil Knight in 1964. It is famousfor its sports products. Having sales of 20$ billion and more than 50% of sales is outsidethe USA. Niki starts its business from 500$. It produces its goods from Asian countriesbecause of low wage rate and high unemployment in these countries. These Asiancountries eager to attract FDI and improve their economics.CRITICAL ASPECTThe wage rate is low were Niki product manufacture Low wage rate Unhealthy condition Human rights Lack of labor laws Child labor CSR violatesSTATISTICS 12 billion annual sales More than 50% sale outside the USA Initial investment is 500$ 20$ per hour wage rate in USA 1$ per hour wage rate in AsiaCONCLUSIONNiki have to face the allegation of low labor environmental condition and is notaccording to standard labor laws. But Niki denied these allegation and start monitoring
the manufacturing units. Niki have to work on the social income statement and have tomonitor its social responsibility. QUESTIONS & ANSWERSAnswer no 1: The criticism on Niki is right because the company not onlyfocus on making wealth but also have to make its social value. Company must practicesocial responsibility. Company should make its business ethics and coprate governancelaws restrict. Company has to monitor its social responsibility policy.Answer no 2: Following action will prevent the Niki from sweatshop labor Niki have to perform social audit and financial audit as well. International human right and labor laws must be practice. Use certain personality to maintain the image of company. Practice social responsibility. Company has to manage a fixed wage rate or benchmark. Improve its overseas operation.Answer No 3: Yes, company especially multinational companies have topractice the social responsibility to maintain its image and to boost its growth. When acompany goes beyond the border they have to face the social and culture differences.Now the world is like a global village and social aspects of company is important as wellas its financial aspects. Considering all these views we find the importance ofcoprate social responsibility.