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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 2 Alotaibi 3 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.