Nike Debate

Case: "Nike: The Sweatshop Debate" 1. Should Nike be held responsible for working conditions in foreign factories that it does not own, but where subcontractors make products for Nike? Yes, Nike is not only responsible but also accountable for the working conditions of foreign countries that it does not own. Nike should realize that it is a Global Organization and working globally does not only mean that taking advantage of low cost destination but also taking responsibility of the contractors/employees working in other countries. For example: Pepsi was recently in the news for allegations of having pesticides in the cold drink in India. Pepsi ensured that it has same standard of water purification across the world and not just meeting standards in the Indian Market. Similarly, Pepsi should realize that while they are getting cheap labor in low-cost destinations but at the same time they need to be socially responsible to ensure that the workers get minimum wages and work in conditions that are acceptable in respective countries.

2. What labor standards regarding safety, working conditions, overtime, and the like should Nike hold foreign factories to: those prevailing in that country, or those prevailing in the United States?

There need to be combination of standards for Nike. If Nike follows only the standards (wage rates) prevailing in Unites States, it might not be able to enjoy the cost advantages that they are realizing by off shoring manufacturing of shoes. However, if Nike adopts the standards prevailing in the country of manufacturing then it is not able to comply with some of the Human Rights related issues that global organizations should comply with. Hence, it is very important that Nike designs a combination of standards that ensures that workers get at least the minimum wages in the respective country but the working conditions should be acceptable enough for workers to work and the minimum age limit of workers should also