Nike: From Sweatshops to Leadership in Employment Practices

Nike: From Sweatshops to Leadership
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Discern how a more effective ethics programs and a more viable code of conduct could have mitigated the ethical issues faced by Nike.
Nike is one of market leaders in the athletic footwear and apparel. In the 1980’s the company enjoyed unprecedented growth, and then started shifting manufacturing operations to Asia and Latin America (Ferrell et al., 2011). In the 1990’s the company suffered bad reputation from human rights violations, environmental problems and labor unrest in some third world countries where the company operated. The company’s response was denial and damage control rather than wide spread reform, but over time the company started monitoring operations in East and South Asian facilities. Protests and threat of deal cancelations in the U.S further damaged the company’s reputation, but the company has made changes over time to improve the code of conduct (Ferrell et al., 2011).
A code of conduct would have prohibited inappropriate behavior among the subcontractors, as there was no emphasis on the ethical behavior. Through establishing a viable code of conduct, Nike employees would have clarity on what was expected of them and what was considered unethical practice (Nisen 2013). Equally, the management would have been more accountable to the stakeholders as the code of conduct provides guidelines on ethical practices in the company’s facilities. There is less liability on the part of the company from poor performance of employees on ethical practices, while unethical managers are held accountable for their choices because of a code of conduct
A better code of conduct and ethics program would have been effective in improving relations with stakeholders (Nike, 2011). Employees are integral to the success of the company and as internal stakeholders their concerns should be taken into account when formulating ethics training programs. Nike has adopted more worker friendly policies to improve the wellbeing of employees, where inspection in labor standards has been critical to the success of the company’s code of conduct. Similarly, the company now views the community as a valuable asset to the company, and Nike has initiated programs to reduce environmental degradation and promote health (Nike, 2011). Essentially, the management’s commitment to the company’s stakeholders improves relations and should have a priority in the 1990’s when the company faced criticism.
2. Describe an ethics training and communications program that may have kept Nike from encountering the ethical issues it did in this scenario.
Nike needs to adopt policies related to ethical practice in operations that should be adhered to by the management and employees of the company. As a multinational company with operations in diverse countries, the company can learn about child labor laws, labor relations and enviro...