In today's business world, business ethics has become one of the most contentious issues. A growing number of multinational corporations (MNCs) are confronted with ethical dilemmas in the countries where they do business as a result of the globalisation of markets and production processes (Dunn and Brooks, 2011). Ethical practises, according to Archibong-Anyans (2015), are critical to a company's long-term viability because they form the basis of a sustainable business model. However, in today's business environment, every company is racing to gain a higher level of profit by using'shortcut' methods (McFarlin and Sweeny, 2015 pp309). To make more money, some companies engage in activities that society does not tolerate in order to create more well-paying jobs and protect the environment (Parboteeah and Cullen, 2013). Consumption is also putting pressure on businesses, as consumers seek out lower-cost goods. Thus, most companies face an inevitable conflict in the concept of business ethics due to the differing stakeholder, shareholder and consumer interests (Archibong-Anyans, 2015). Nike Inc., a United States-based multinational corporation, is one such example of a corporation grappling with ethical dilemmas.
The unethical treatment of workers in other countries, as well as Nike's environmental impact, have dogged the company since the 1990s, despite Nike's growing success (Wazir, 2001). The evidence suggests that Nike has failed to meet the needs of its customers and stakeholders when it comes to corporate social responsibility, resulting in a loss of customer loyalty and trust. Despite Nike's efforts to address these issues, the company still faces ethical dilemmas on a daily basis, primarily in relation to child labour, social injustice, uneducated workers, workplace abuse and low wages for employees (Wazir, 2001). The three ethical issues Nike Inc., its stakeholders, and society as a whole face will be the focus of this essay.
The use of sweatshops – a factory where manual workers are employed at low wages for long hours and in poor conditions – is the first ethical issue to be addressed (Powell and Zwolinski, 2011). Nike's sweatshop labour practises in Indonesia, Mexico, China, and Vietnam have been the subject of a long-running campaign against the company dating back to 1996. A large number of workers were found to have been held back by the minimum wage and long overtime hours, which were violations of labour laws (Greenburg and Knight, 2006). Deprived working conditions and cheap labour exploitation were still critical issues for the company despite its denials. In both the United States and the United Kingdom, the establishment of campaigns has resulted in organisational changes, both strategically and ethically (Powell and Skarbek, 2006).
Child labour is a second ethical concern, similar to the use of sweatshops. In the footwear industry, the legal working age is 18 years old. In light of the company's global workforce of more than 600,000, there is evidence to suggest that Nike has broken a number of labour laws (Boggan, 2001). Outside of the footwear industry, Nike produces and manufactures sporting goods and accessories for some of the world's most well-known teams. As a result, Nike is best known for producing soccer balls in Pakistan, which are then exported around the world and used in a wide variety of sports, including football (Boggan, 2001).
Nike Inc. enforces a final ethical issue: the company's impact on the environment. Stakeholder expectations demand that businesses meet social and environmental standards as part of corporate social responsibility. After receiving a poor rating from the Ethical Consumer's Environmental Report in 2015, Nike was not capable of doing so (Nike, 2017). According to the findings of the study, its manufacturing facilities were to blame for rising temperatures, toxic pollution, water consumption, and waste. Nike, on the other hand, was unable to explain why the effects had occurred because no mention was made of agriculture. Additional studies have also highlighted environmental concerns related to carbon emissions, renewable energy use, and the sourcing of certain materials. Despite Nike's efforts to address these issues, the company was unable to meet its CSR-related ethical goals because of high toxic levels in the workplace and the environment (Nike, 2017).
Accordingly, it is clear Nike has been plagued by numerous ethical issues over the past two decades, all of which have had a negative impact on the company and its ability to meet consumer needs. As a result of these issues, Nike has implemented several policies and strategies. Regarding their environmental footprint, Nike sought to implement an environmentally friendly closed-loop production process in which recycled consumer waste is used in the manufacturing process instead of raw materials (Nike, 2017). A new partnership with the Sustainable Apparel Coalition allowed Nike to introduce environmentally friendly materials like organic and recycled cotton that could be used on their products to reduce waste and water usage. Reduced off-cuts are another benefit of using recycled cotton and polyester (Nike, 2017). Because of this, more waste can be reused as new materials by developing new low-carbon materials. The company has set environmental footprint reduction goals in line with its ethical policies to protect the environment. Its 2020 goal is to reduce its carbon footprint at least 10%, increase the use of sustainable materials for all products, reach 100% renewable energy locally and internationally, eliminate footwear waste during manufacturing, adopt new approaches related to water use reduction within the supply chain, and reduce the discharge of hazardous and toxic chemicals (Nike, Inc., 2015). Aside from that, Nike has publicly committed to cutting its carbon emissions by more than half by the year 2025. (Nike, Inc., 2015).
In spite of these positive changes, Nike still hasn't fully committed to eliminating hazardous chemicals from its supply chain, which is now seen as a major ethical issue for the workers who are exposed to them on a daily basis and those who wear the products made by Nike.
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