Business Analysis Of Nike's Ethics In International Business

As the world’s largest clothing and apparel brand, Nike, Inc. is constantly under pressure from shareholders, and competitors alike to compete on a global stage. With this, comes pressure to derive strong sales growth through superior products quality, strong brand strength, and a sustainable corporate and ethical image. In order to stay on top, growth is not enough. Nike must also keep costs in line and continue to grow their bottom line – maybe even faster than the top. This focus leads companies like Nike to invest in foreign operations in less-developed countries like South Korea, Taiwan and Vietnam where labor and production costs are dramatically cheaper. The result is clear: profits grow, keeping shareholders happy; the company grows, …show more content…
Donaldson identifies two extreme viewpoints on this issue: Relativism and Imperialism. Relativism is the belief that no culture’s ethics are any better than another. The concept of ‘when in Rome, do as the Romans do’ is often used to justify behavior. However, as Donaldson notes, relativism is morally blind. Doing business in another country can be appealing as is presents an opportunity to bypass local laws that are detrimental to a company’s profits. By accepting the ‘when in Rome’ mantra, a manager is no better than the locals exploiting citizens in the foreign country. Some logic and application of a strong moral compass could and should easily discourage these …show more content…
Unfortunately, this is assumption is not universally understood, or accepted, thus proving the theory and flaws of ethical Imperialism. The managers’ disregard for these values, has created a culture within the plants where productivity, profits, and efficiency are paramount while fair working conditions take a back seat. The first and second values, respect for human dignity and respect for basic human rights, are constantly ignored by the plant managers. Reports of intimidation, harassment, and abuse clearly show the division’s lack of respect for the human intrinsic value. The third value, respect for good citizenship, is a little more difficult to analyze. As a good citizen, Donaldson states that a firm should support the local social institutions such as the economic system, education system and government. The Vietnamese government is divided on this issue as the unions want to fight for worker’s rights while investment planners are afraid of losing Nike’s investment which would eliminate jobs and make employee’s lives worse. By making promises of doubling the local minimum wage, offering free high school equivalency programs, and a loan program to help fund