Examination of the global standards of Nike
In today’s increased globalization, one must understand the fact that it has become increasingly difficult for a global manager to manage his operations perfectly. The manager would need to perform many more activities, including facing the operational and strategic challenges that his business throws at him, much more than he would have done in previous years. He would also have to be knowledgeable in the several different aspects of risk management, so that his company would perform at its optimum best, with no constraints. (Frenkel; Hommel; Rudolf; Dufey, 2005) in today’s working environment, there are several different types of global specialists: business managers, country managers and functional managers. Today, a company does have to be much more effective and ready to face the multiple challenges that are thrown at it on a daily basis, while at the same time remaining sensitive to various issues that concern their employees. (Churchwell, 2003)
Take a case in point, Nike. A new report issued by the non-profit alliance ‘Global Alliance for workers and communities’, states that workers of Nike have been facing a diverse set of problems: sexual comments and unwanted attention form supervisors, and dissatisfaction with managers. (Akst, 2001) This company has been embroiled in controversy for a great many years now, and main complaint being that the company does not take care of the working conditions of its thousands of employees across the globe. However, the reason may be that it is subcontractors make products for Nike; it does not own the factory. However, ask experts from across the globe, can this justify the fact that most of the workers for Nike are either working at much lower wages than they must earn, or they are grossly underage. Should Nike be held responsible for working conditions in foreign factories where subcontractors make products for Nike? (“Nike: The Sweatshop Debate,” n. d.)
In my opinion, a company of the global standards of Nike, which makes $10 billion in annual revenues and sells its products in more than 140 countries must remain more aware of the pathetic condition of its workers; they are forced to work six days a week for only $40 a month, and for much longer hours than is accepted in developed countries across the world by their factory managers, who probably wish to make money as quickly as possible without thought for the difficulties of his workers. One worker, Lap, even stated that she had to complete her expected quota of shoes before she could go home, even if she was unwell, or had to leave on an emergency. To add fuel to the fire, a child as young as eleven years old was also forced to work in the factory, in similarly depressing conditions. Nike as a responsible multinational company must try to take steps that would offer its workers better working conditions or wages, and therefore, must be held responsible for the dismal state of affairs. (“Nike: The Sweatshop Debate,” n. d.) would also like to state that Nike must try to follow those safety standards that prevail in the United States, of course, with a few modifications wherever necessary, Nike being a responsible company that supposedly cares for people, and especially its workers. The reason is that in the country where the work is sublet to contractors, working conditions are pathetic, and even the existing rules and labor laws of the country are blatantly flaunted, like for example, workers only 13 years old, earning as little as 10 cents an hour are forced to toiled up to 17 hours everyday, and that too in an enforced silence, failure of which would mean a fine of $1.20 to $3.60 per violation, according to the Global Exchange Report, and this means that the rule stating that no child under 16 may work in a factory is being sullied everyday. (“Nike: The Sweatshop Debate,” n. d.)
In Indonesia, for example, workers like framers receive about $1 per day, while Nike pays its workers about $2.28 per day. However, Nike is constantly bombarded with accusations that the pay rate for its workers is way too low. While this may be true for the United States of America, as far as Indonesia is concerned, the workers are being paid much more than they are accustomed to. One can even go so far as to say that the general working conditions for working classes in Indonesia are poor and appalling, and this may mean that wherever the workers were to work, be it in Nike, or in any other company, they would face the same distressing conditions. It is a fact that Nike is relentlessly subjected to negative publicity, in the main for its ‘sweatshops’. To combat this, Nike hired Andrew Young, a man who had been an ambassador to the United Nations, and charged him with the responsibility of assessing the sweatshops. He visited fifteen factories in different countries and he stated that he saw nothing wrong with the workplaces, and that “…I saw crowded dorms… But the workers were eating at least two meals a day on the job and making what I was told were subsistence wages in those cultures.” (“Nike: The Sweatshop Debate,” n. d.)
Young had to face severe criticism after his comments, and a few years later, Nike decided to set up a task force made up of industry leaders, people from human rights groups, and labor leaders, who would try to banish sweat shops. An agreement was reached, wherein U.S. manufacturers would protect the rights of their workers abroad, and also ensure that the work week would last up to 60 hours, and that minimum wages would be paid to their workers. The Fair Labor Association or the FLA, a monitoring association was created, which would examine whether companies were maintaining their promises. However, I feel that the criticism of Nike’s sweatshops was not handled satisfactorily, and perhaps some other method may have been used to do it. Therefore, Nike has to bring in changes into its current policies even if they eventually hinder the ability of the company to compete with others. For example, Nike raised the age limit according to the ILO to 18 in footwear manufacturing units. This could be an excellent policy, but it was criticized saying that Nike had never bothered with child labor laws, and therefore why was it doing it now? Is it a public relations stunt, asked critics. The thing that needs to be changed is the minimum wages, and not the minimum ages. (“Nike: The Sweatshop Debate,” n. d.)
The Workers Rights Consortium or WRC, an alternating auditing association was set up by the United Students against Sweatshops or USAS, as a form of protest against Nike. In their opinion, the FLA, which had cropped up from the Presidential task force on sweatshops, was merely an industry tool, and could never be an independent auditor. This fact may be true, if one were to base one’s opinion on widespread criticism on the Presidential campaign against sweatshops. Sweatshops are indeed a global problem, and several multinational companies that have manufacturing units outside their own countries, so that they may take advantage of cheap labor contribute to this problem, and the problem is in fact much larger than Nike, and the problem does not lie with just one individual factory, or one individual manager. The problem in fact lies with the global production system that has been lowering standards through the years, and has also been steadily contributing to the ever worsening conditions in developing countries across the world, and also in several factories across the United States of America. (“Nike: The Sweatshop Debate,” n. d.)
One must try to find solutions to the problem of sweatshops by using the ingenious method of asking the workers. The need of the hour could well be to create and thereafter, implement a systematic and strident policy that would monitor and bring in improvements in the garment and footwear and other similar industries. The industry must become more transparent, and open to public as well as market scrutiny. The veil of secrecy and silence that these industries have been hiding under must be exposed, and no secrets allowed remaining within the four walls of the sweatshops. One could even create a system whereby workers and communities would be able to speak in the same language, and therefore, communicate better with each other through their own organizations and associations. If one could take all these steps, then these could well prove to be the best global solution to the problem of sweatshops and cheap labor and exploitation under the name of the organization. (O’Rourke, 2001)
Akst, Daniel. (2001) “Working Conditions of Nike Contract Workers” NCPA Trade Issues.
Retrieved 26 September, 2007 at http://www.ncpa.org/pd/trade/pd030601g.html
Churchwell, Cynthia. (2003, Dec) “The New Global Business Manager.” Retrieved 26 September, 2007 at http://hbswk.hbs.edu/item/3827.html
Frenkel, Michael; Hommel, Ulrich; Rudolf, Markus; Dufey, Gunter. (2005) “Risk management,
Challenge and opportunity” Springer.
N.A. (n. d.) “Nike: The Sweatshop Debate”
O’Rourke, Dara. (2001, Feb) “To fix sweatshop conditions in factories, we must listen to workers.” The Boston Globe, p. 7.
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