Essay The Ethics Of Nike 's Corporate

Essay The Ethics Of Nike 's Corporate

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Nowadays, it has been acknowledged that having an ethical business could determine the future business success. According to the 2015 Edelman Trust Barometer, consumers purchase a particular product because of their trust on the company produced it (Edelman Berland, 2015). Therefore, more company has instilled their ethical values to operate their business. Nike’s corporate as one of multinational enterprises (MNEs) has also implemented its code of conduct and code of leadership standard. The purpose of this policy is to ensure the ethical practices in their business. The company has revised these conducts since Herbert’s 1996 (cited in DeTienne & Lewis, p.361) criticized Nike as a giant pyramid which repress its labours. This critique was then followed by the lawsuits against the company in April 1998 (DeTienne & Lewis, p.364) and demonstrations in many countries. These continuing pressure impacted on the negative image and decreasing revenue of the company. Consequently, the ethical practices of Nike’s corporate have argued until now. Thus, this essay will discuss whether Nike has transformed as an ethical company or not by evaluating sweatshop utilization, environment and corruption issues in this company.
The use of sweatshop in multinational companies has become a common practice around the world. The main reason is because it could maximize profit by overseas manufacturing with lower labour costs. According to Skarbek et al (2012, p.556),the sweatshop is a factory in the developing country which employ the low wage labors in the poor working environment to produce goods for multinational enterprises. The proponent of sweatshop claimed that based on consequentialist approach, sweatshop has given a positive impact on the ...


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...a report of sweatshop abuse in Indonesia, where employees were still getting harsh treatment from their supervisors. This condition was also backed up by military power and lacked of monitoring from Nike. The use of regime power could also be seen in Russia, Vietnam, Sri Lanka, Thailand and Philippine.
The other perspective that could be considered is the disparity between the labor wages with the executive’s salary of Nike and the huge of its advertising cost. Meanwhile, Nike’s products are mostly range in the premium product. Therefore, it is clearly seen where most of company profit runs out every year. Regarding those perspectives, it could be assumed that Nike has not become an ethical company. Despite all improvement that they have implemented, they still have to be more consistent to turn their negative images, especially because of their sweatshop history.

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