Nike Case Study

Register to read the introduction… For example Nike, which outsources most of its manufacturing tasks to other companies, had to face stiff public censure for possibly encouraging labor practices that provided very little compensation to the workers. Most of Nike’s shoe and apparel manufacturing units are situated in the Asian region where the labor costs are far less when compared to rates in the US. Additionally, the workers in the Asian region are less organized, are constrained to work at lower wages in order to overcome poverty and familial pressures, and so were easily available even if the conditions in the factories were pathetic according to US labor standards. The main issue that often came in for public criticism was that Nike used the services of ladies who could be paid much less in the Asian job markets. Similarly, the peculiar societal culture in the Asian region ensured that large numbers of ladies were available to take up the jobs offered by Nike's business associates in these countries. Another serious allegation which rocked the business prospects of the company was that Nike's business counterparts in Pakistan used child laborers to make footballs. The fact that child labor is banned and considered unethical in the developed nations was a major factor that turned public opinion against the …show more content…
For example, the company hired well known independent auditors to look into the practices of the violation of labor rights in its associate companies. This ensured that the Nike could assess the company even if the company secretly violated labor rules to maximize profits. A bare minimum wage plan was agreed upon in various companies so that the workers could be assured of at least a decent minimum pay. Workers were offered a better safety package so that they could be kept away from harmful chemicals and reagents. A medical plan was constituted to look into medical problems and the internal quality of the factories was made to suit internationally accepted health standards. This meant that the on-site hazards to the workers could be reduced to a great extent. Forced labor was abolished and a maximum limit on working hours was introduced. Similarly, the company discouraged engaging the services of children below a specific age for work in the factories. Labor issues like discrimination on the basis of religion, sex, and age were to be done away with and employees had to be given a right to organize themselves to press for their