Corporate Responsibility -- Nike Corporate

Corporate Responsibility -- Nike

Corporate Social Policy: Nike's dispute with University of Oregon

The Fair Labor Association and the Workers Rights Consortium both ostensibly strive to establish and enforce fair labor standards in America and abroad. However, the Fair Labor Association, part of a Bill Clinton White House-backed organization, attempts to strike a balance between the needs of corporations and the concerns of their workers, rather than purely act as an advocate for the rights of laborers like the Workers Rights Consortium. The Fair Labor Association also has apparel companies on its board to provide a voice for employers as well as employees. This reflected the fact that although Clinton's administration was largely a worker-friendly administration, it was hardly deaf to the voices of corporations and the desire of American companies to engage in profit-maximization, including saving on labor costs. Furthermore, many American consumers, although they might not admit it, like the savings they are able to incur because of the reduced input costs enabled by outsourcing labor to countries where workers receive only a minimal salary in comparison to workers in the United States.

Nike shareholder, intent on maximizing the profits derived from the company in which he or she owned an interest might assert that the purpose of a corporation is not to extend charity, but to make a profit. Viewed in these terms, Nike has a right to profit maximization, so long as it does not transgress the laws of the United States. Given that the Fair Labor Association validated its practices, a Nike shareholder would see no ethical conflict between Nike's practices as they were the practices of a law-abiding company. Nike only violated its own internally generated corporate ethical code and the sensibilities of human rights watchdog groups. Furthermore, the shareholder might assert that given that so-called sweatshop laborers are often equally poorly paid in local enterprises or are unemployed relatively speaking Nike is giving these workers a fair wage, or at least treating them fairly. Nike itself was once a developing, upstart company, beginning with only a handshake and a $500 investment.

A more foresighted Nike shareholder might take a slightly different view. Nike's image as a corporate brand was severely injured because worker's rights advocates publicly exposed its unsafe sweatshop labor practices. Therefore, by engaging in more fair labor practices, and making a commitment to engage in a more ethical strategy commensurate with its youthful, thoughtful, and grass-roots image popular amongst adolescents, particularly adolescents from urban backgrounds (or suburban youths wishing to live the life of urban youth) treating international workers better might generate more revenue for shareholders in the very long-term. The University of Oregon protest is proof of the lack of wisdom of abusing workers in other nations -- the media fallout will catch up with Nike, eventually.

A human rights organization would vehemently disagree with the self-interested shareholder supporters of sweatshops and state that merely because workers are desperate and are willing to accept lower wages is no reason for Nike to take advantage of such desperation. Nike keeps wages low, rather than driving them up in the context of the local economy. For only a few pennies more, Nike could pay the workers a much fairer wage, and if American consumers were only willing to pay a bit more, the overall economic health of the developing world might be improved. Also, by using the developed world as a source of cheap labor, no local industry and entrepreneurship is stimulated -- local industries cannot compete against Nike, and Nike essentially uses the developing nation as a colonial outpost, rather than makes a contribution to the nation's economic progress by building its infrastructure like a local company might be able to do. Rather than cultivating relationships with businessmen abroad in the developed world, Nike instead exploits the developed world as a source of profit and stifles local businesses.

U.S. labor union, would add that Nike takes jobs away from American workers by outsourcing labor abroad. Again, for only pennies more a day the mega-company could employ American workers. Furthermore, even if the labor organization did not directly represent international workers, it would be filled with a sense of outrage that basic labor standards were being violated, such as the fact that workers in the chemical section of the factory were not provided with enough protective gear, that working hours were too long, and working conditions overall were substandard, despite the wealth of the Nike corporation.