Sunday, April 21, 2013

Nike: Abuse in Indonesia (2011)

Nike logo
Nike was founded by Bill Bowerman and Phil Knight. They started to create the company back in the 1960's in their shop Blue Ribbon Sports. They were taking shoes that Tiger Shoes sent them and improving them to make them better for runners. Throughout the 70s Jeff Johnson, the first employee of Blue Ribbon Sports, marketed "The Swoosh". This was Nike's original name because of the logo. Nike then became a publicly traded company in the year 1980. Nike has been an ever expanding athletic company. Nike owns Nike, Converse, Hurley, Jordan, and also Nike Golf. Within all these different companies Nike makes all things athletic including shoes, apparel, equipment, and also accessories. Nike has had some trouble always being an ethical company. There were reports about 10 years ago of abuse in the factories overseas where their products were being made. The started the "Better World" campaign where they would go into these factories and make them so they met Nike standards.

Indonesian workers from a Nike sweatshop
Nike purchased the Converse company in the year 2007. In the year 2011 workers from the Pou Chen Group factory in Sukabumi, Indonesia came out and spoke of abuse happening within the factory. This abuse included both physical and mental abuse. The reported physical abuse included them being slapped, kicked, having shows thrown at them, and also scratched until some people bled. The mental abuse was a combination of things as well. It included the management screaming at the workers calling them names such as monkey, dog, and pig. They were also mentally abused to the point where they did not want to speak up against the bad things that were happening to them. One woman reported that she was fired after she spoke up against the management. These people were making $0.50 an hour, which was just enough to live off of with bunk type housing and food. They could not afford to lose these jobs so instead of standing up against the abuse they were keeping their mouths shut. The stakeholders involved in this case include the factory workers and their families, factory management, and also Nike.

Converse All-Star sneakers, run by Nike
Individualism can be defined as the right to do what you want to do but not being able to decide for others. When focusing on businesses this means they are to maximize profits and shareholders wealth. The only thing the business cannot do is break the law. When looking at Nike in this case, they are clearly trying to maximize profits. They send their productions overseas because of the cheaper labor work force. Nike is also not breaking any laws, if anyone is breaking any labor laws it would be the factory itself, not Nike. In the normative theory of individualism, Nike is an ethical company. 

Utilitarianism looks at the overall happiness of the stakeholders. As recently stated the stakeholders include the factory workers and families,  the factory management, and also Nike. The factory workers and their families are clearly unhappy. They are being abused and they cannot stand up and do anything about it. The factory management is doing what makes them happy. If this situation caused any unhappiness they could stop what they are doing right away and there wouldn't be a case to look at and investigate. Nike is unhappy by this situation. They have already tried so hard to improve factory work overseas and now all that work is being questioned because there is clearly still abuse happening in these factories. The majority of the stakeholders are unhappy which means that Nike is unethical when looking at the utilitarianism theory. 

The third theory is the Kantianism theory which has four parts. The definition includes acting rationally and be consistent in your behavior, helping others act rationally, respect others decisions, and to act in good will. Nike is not acting rationally or being consistent. If Nike was being consistent in its behavior Nike would have made these factories work at Nike standards just like the other overseas factories. Also if Nike wanted to help others act rationally it would be talking to the management at these factories to help them learn how to treat the employees. If Nike was working in good will, these employees would not be being treated as poorly as they are. Nike is very unethical according to the Kantianism theory of business ethics. 

Virtue Theory
The final theory that Nike will be analyzed under is the Virtue theory. The virtue theory includes four virtues; courage, honesty, temperance, and justice. When it comes to courage and honesty, Nike knows these employees are being treated so poorly and they are doing nothing about it. They say that their hands are tied due to the contracts Converse was in with these factories prior to Nike purchasing Converse. Temperance refers to having reasonable expectations, clearly Nike has no expectations for how these employees in Indonesia should be treated. Justice includes the idea of fair practices, if Nike wanted justice in their factory in Indonesia they would have fair practices for these employees, instead they are abused daily at work. According to the virtue theory, Nike is yet again an unethical corporation. 

DesJardins, Joseph. (2009). An Introduction to Business Ethics (Ed: 4). New York, NY: The McGraw-Hill Companies, Inc.
NIKE, Inc. - The official corporate website for Nike and its affiliate brands.." NIKE, Inc. - The official corporate website for Nike and its affiliate brands.. N.p., n.d. Web. 21 Apr. 2013. <>.
Nike workers kicked, slapped and verbally abused at factories making Converse line in Indonesia | Mail Online." Home | Mail Online. N.p., 13 July 2011. Web. 21 Apr. 2013. <>.
Salazar, Heather. Business Ethics, Economics, and Individualism. 21 April 2013. <>
Salazar, Heather. Business Ethics and Virtue. 21 April 2013. <>
Salazar, Heather. Kantian Business Ethics, Utilitarian and Business Ethics. 21 April 2013.  <>

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