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Based on the presented Nike’s Cheap Labor article by Tim Glenn, several ethical issues stand out. Among them is the failure of Nike Shoe Company to uphold the values of what is right and wrong in the society. It was unethical for Nike to allow various unethical practices to be carried out by its subcontractors.
Since the products of all its subcontractors bear its name, Nike should have clearly spelt out its ethical code of conducts to its contractors. According to Berle and Means (1932, p.1), ethics go beyond what the government can control to behavior regulation.
The contract awarded to Earnest and Young to ensure inspection of ethical code of conduct in its contracting companies seems to have failed. Various unethical practices were evident in its subcontractor firms. Nike was at fault for unethical labor practices.
The first evidence of this fault is that Nike closed and shifted its factories in the United States to Asian countries where there is cheap labor. Although the company does not involve itself in direct production, it is aware of the unethical undertakings by its subcontractors.
Secondly, since the products of these subcontractors belong to Nike and that they bear its name, it should have eliminated these unethical practices. Ignoring such unethical practices on employees who make its brands will amount to employees’ enslavement (Kingsolver, 2008).
The media has a duty to educate masses (workers for this case) about their rights. According to Chomsky (1989), one of the roles of media is to educate the employees on business ethics. In this case, the media in Asia and other places where Nike has its factories should enlighten workers.
Workers should know that they have the right to good working conditions, work at will, not to be sexually harassed, good housing and food, and even a good pay. Media should air employee education programs. The second role that the media can play is exposing unethical acts of such companies as Nike.
Since most of the companies will do everything to ensure that their image is not soiled, Nike would act quickly to restore employees’ ethics. Media should publicize unethical acts such as firing of employees advocating for better terms by force, sexual harassment, poor housing, poor pay, and forced overtime.
This airing will expose the other side of the source of the famous Nike’s products. Chomsky (1989) asserts that airing of unethical acts of a company enlightens the public and employees.
The major consequence of the mistreatment of workers by contractors and subcontractor of Nike in Asia is the development of a bad image. Although Nike spends a lot of money in endorsing celebrities to make up its image, this brand will gradually be soiled.
If the company can afford to pay about $250 to athletes in endorsement, it should spend more in creating a good image. Brand means everything to a company since it creates a feeling of either attachment or lack of attachment to a company.
It makes employees, investors, financiers, customers, and communities desire and or detest being associated with the company. When media exposes the variety of unethical acts that the company engages in, its public stakeholders will develop a negative image about it (Chomsky 1989).
No one would like to collaborate with inhuman companies. No investor would like to be part of a company that physically abuses its employees and or does not pay them their dues.
Customers of the company are also likely to leave its products and turn to other apparel industries because they will always attribute the company’s products to its unethical practices. No one would like to buy products of a company that cannot compensate workers who had accidents in the course of producing its goods.
Many potential employees will also shun working for a company due to its bad image (Schneider et al. 2003, p.836). This case means that a poor brand will deny Nike Company the talents and creative minds that are likely to go to its competitors. The competitor will produce high quality goods.
As a manager, I would take the most effective action in image restoration. The first step will be allowing open and efficient communication among the company, its contractors, and employees.
In fact, Parker (2005, p.17) affirms that development of formal ethics and its communication is essential in today’s business world. I would establish structures that will allow open communication. There is a clear communication cut between employees and Nike as a company.
By ensuring that there are good communication paths, employees will regain confidence in the company. According to Guest (2007, p.52), employees should be allowed to air their grievances and or join trade unions without being sacked or punished.
Communication will also ensure that employees are enlightened about their rights and the code of conduct of the company. To boost communication, I will provide suggestion boxes, hotlines, and emails for them to use in case their supervisors or contractors are in breach of the ethical code of conduct.
This strategy will also enable clear punishment of the contractors if they breach it.
The second tactic that would save the image of Nike Company is advertising, which is paid for to create public attention to certain goods and services.
I would use media (both print and electronic platforms) to advertise the strategic changes that the company has undertaken to ensure employee satisfaction and product quality improvement through the common catchy phrase that, if a business treats its workforce well, they will in turn treat clients well.
The changes in employee relations would be aired on media. Schneider et al. (2003, p.836) assert that employee satisfaction makes potential employees aspire to join a company in the future.
In addition, it will make Nike’s customer change their perception of the company from bad to good. Media has the ability not only to tell people what to think about but also how to think about a certain idea.
With frequent positive exposure of the changes in the company, people will not only think about Nike but also tuned to think about it positively.
Conclusion
Nike Cheap Labor article by Tim Glenn is an epitome of the many organizations that strive to reap much not only on the expense of its workforce but also on their own expense.
Mistreating of employees by not giving them their due wages, denying them motivations, and not involving them in key decision-making process comprise some of the unethical issues that companies like Nike are practicing. Kingsolver (2008, p.268) says that all unethical business practices amount to slavery.
Such ways like poor payment of employees, dismissal from duties without protocol, unpaid overtime, sexual harassment of women, and avoiding paying workers’ benefits are unethical.
Therefore, media should come in to publicize these malpractices in an effort to curb them by exposing their implications not only to the employees but also to the victim companies.
References
Berle, A & Means, G 1932, The Modern Corporation and Private Property, Transaction Publishers, New Jersey.
Chomsky, N 1989, Necessary Illusions: Thought Control in Democratic Societies, Pluto Press, London.
Guest, D 2007, HRM and performance: Can Partnership Address the Ethical Dilemmas?,Macklin & Campbell, Pennington.
Kingsolver, A 2008, Capitalism, Encyclopedia of Race and Racism, Macmillan, Detroit.
Parker, M 2005, For Business Ethics: A Critical Text, Routledge, London.
Schneider, B, Hanges, P, Smith, D, & Salvaggio, A 2003, ‘Which Comes First: Employee Attitudes or Organizational Financial and Market Performance?’, Journal of Applied Psychology, vol. 88 no. 1, pp. 836–51.
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