BUSINESS ETHICS GOVERNANCE

& SOCIAL RESPONSIBILITIES

NIKE CASE STUDY
Ethical issues and CSR activities:

o Nikes brand was threatened when criticism over labor practices at

contract factories became a topic of concern by consumers,

particularly college students. In the 1990’s contracted factories in

Asian countries presented unsafe working conditions and practiced

forced child labor. Its Malaysia factories were housing its workers in

deplorable facilities, garnished wages to pay for work permits and

“recruitment fees” and withholding their passports to prevent them

from leaving.

o Nike’s approach shifted after realizing that ignoring supply chain

responsibilities was not prudent in the company’s global

reputation. Nike was committed to improving working conditions

by expanding independent monitoring; raise minimum wage

requirements, strengthen environmental, health, and safety

standards.

o Nike also shared its vision of reaching a closed-loop business

model where their goal was to achieve zero waste in the supply

chain and have products and materials that can be continuously

reused.

 Nike affirmed its commitment to the goal of “Zero discharge of hazardous

chemicals for all products across all pathways in our supply chain by

2020”.

 The incorporation of “waterless dyeing” technology for textiles that use

co2 instead of water has decreased processing costs, less energy and

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 less chemicals in its products. Continuing efforts to create and

encourage innovation on socially sustainable material is ongoing with the

investment in DyeCoo.

Recommendations:-

 Nike should constantly be rebranding themselves, making the company

even further superior. Nike’s trump card so far has been their wise choices

in upper management and their willingness to embrace technology. The

logical choice for Nike is to continue down this path. Nike will not only need

to pay attention to current business trends, but they will need to rewrite

them; taking every step with planning, evaluation and execution, while

retaining creativity.

 Nike has invested heavily in new sustainability technology. They should

continue to invest in their business partnership with DyeCoo. The

technology behind DyeCoo’s waterless dye machine is an incredible

advantage for Nike. Investing in the technology itself will help them long

run to stay at their current position as the number one sports apparel

retailer.

 As far as labor practices go, Nike should continue to be transparent in their

labor practices. To ensure that labor practices are carried out sufficiently,

Nike should place a higher-level manager to be responsible for the

condition of the workers and their work environment at overseas factories.

The manager would receive ethical and cultural training before going.

 To our closing point, the company has made great steps. Nike found it a

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responsibility to better themselves as a company and employ new ways to

initiate new sustainability trends. We believe that Nike has not only met its

own goal and that of outside watch groups such as Greenpeace but has

gone as far as to surpass those goals. If the company continues its

sustainability efforts, there is no doubt that it will continue to be one of the

best companies.