Download 1 Alotaibi Prince Mohammad University Principles of Management

Prince Mohammad University
Principles of Management
Assignment Two
Corporate Social Responsibility: Nike
Reem A. Alotaibi
201100196
Principles of Managemt
Dr. Wael Zaraket
November 4, 2012
Alotaibi
In the current business environment, I found a contemporary corporate social
responsibility issue: Nike Company.
Elaborate why this incident is classified as a CRS issue?
International sportswear company, Nike, Inc. has reportedly been exploiting their
workers in overseas factories in a number of developing countries. Dubbed as sweatshop
factories, the sportswear companies have factory operations in China, Vietnam, and
Indonesia.
Oxfam Australia has reported the conditions of the Nike factory workers in Indonesia.
The International non-government organization shared that eighty percent of Nike
workers are women within the age of 17 to 29. Majority of the workers meanwhile lived
in extreme poverty, their full-time wages of $2 each day. Apart from the low wages, the
Nike workforce are working under hazardous conditions and are constantly subjected to
abuse and harassments of factory managers thinking that this will increase the
productivity of the workers.
Was there any solutions or reconciliation for this issue?
One potential solution, Nike reports, is collaborating with other brands on factory audits
and, maybe more importantly, working with competitors on developing remedies for
labor problems as well as standardized codes. And then there are improvements that can
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be made by Nike alone. Example: “Asking factories to manufacture too many styles is
one of the highest contributors to factory overtime in apparel. We have an opportunity to
reduce this pressure by reducing the number of apparel styles and partnering with the
factories to improve efficiencies through lean production methods.”
Where there any governmental interference to scrutinize this issue?
Yes. There were governmental interference to scrutinize Nike’s issue.
The CRS issue you will choose, could it be considered a corporate scandal?
Yes. It definitely could be considered a corporate scandal. A huge one too!
The CRS issue you will choose, is it epidemic and pervasive in the business
environment?
Yes. A lot of manufacturing companies result to using the cheapest labor they could find
with the minimalist salaries. It’s somewhat greed related, they pay so little and gain so
many! Yet they won’t increase their paying weight or at least try to help the workers who
are suffering from poverty.