Nike’s Views and Goals as Related to CSR
Nike is among one of the best known brands in the global apparel industry. Nevertheless, the company was embroiled in controversy during the 1990’s when it was accused of using sweatshops and child labor in various stages of its production. Leading activists accused Nike of selling products produced in China, Taiwan and South Korea using sweatshop labor (C., 2014, p. 89). After a campaign of incessant public backlash and boycotts, Nike ultimately admitted blameworthiness in the scandal and promised immediate change. In response, the company soon embarked on massive changes incepted by the then director, Todd McKean, starting with a policy of transparency regarding companies contracted to produce its consumer products. The company also went a step further and published a corporate social responsibility (CSR) report in 2005 detailing the improved working conditions and pay scales in its factories.
In addition to the aforementioned changes, Nike also embarked on a revamped determination to fine tune its activities, views and goals; ensuring that they were all in line with its corporate social responsibility (CSR) efforts. The company was now directly involved in ethical and sustainable business practices that were bound to benefit individuals connected to the company. It included choosing to use recycle and recyclable materials that were also easy to work with during the processing stage. The company went a step further by ensuring that its wage laborers worked in safe environments with improved processing capabilities which now used less energy and produced a low amount of harmful waste chemicals.
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Currently, one of Nike’s major goals is to engage in universal best practices in the apparel industry and work together with various stakeholders to carry on its innovative thinking legacy. It endeavors to develop products that meant to aid individuals reach their full potential while still ensuring that they provide opportunities for those seeking gainful employment. By adopting market practices such as bringing individual choices to scale, the company now serves as a prototype for corporate social responsibility (CSR) and now shares crucial intellectual property. Moreover, the company has now adopted the Bob Williads’ and Simon Zadek five stage model to aid in its corporate social responsibility (CSR) efforts (William B. Werther & Chandler, 2010, p. 12). Its board of directors is now tasked with ensuring that the company maintains its business position while still ensuring that the wellbeing of its stakeholders was taken into consideration. As a rule of thumb, Nike now considers the cultures, environment, consumers, contractors and regulating authorities before following through on any of its corporate social responsibility (CSR) efforts.
Ramifications of Nike’s Response
Nike’s response to the sweatshop scandal that rocked the company was swift and surgical. The company was now, more than ever, determined to turn its public relations woes into brand value. Its new proactive efforts now included internal and external policies that were built around its nascent corporate social responsibility (CSR) policy. Transforming the company required long-term commitment from the employees as opposed to only focusing on avoiding risk. The company is now hailed as a leader in the apparel industry for implementing policies that support wage laborers, conducting regular factory audits, in addition to a policy of transparency when dealing with contractors. Furthermore, Nike is now dedicated in stamping out any shady business dealings that were part of the reason why the company was entangled in the sweatshop controversy in the first place. By facing its problems head on, Nike managed to build goodwill through actions centered on its corporate social responsibility (CSR). Building a solid reputation was on top of the company’s to-do list for it was only through such actions that the company would succeed in regaining the consumer’s trust.
A paradigm shift in the company’s strategy is also signaled a new era in Nike. As mentioned earlier, the company began by posting its CSR report for the 2004 fiscal year with a complete list of all suppliers. Companies and suppliers with the “highest competitive advantage” were expected to miss out during the selection process to pave the way for others clamoring for a level playing field. Nike also co-founded the Fair-Labor Association whose mission was to improve working conditions in companies while embracing sustainability. In order to achieve its corporate social responsibility (CSR) goals, the company also transformed its organizational scope which now included accountability as a key performance indicator. Nike now makes a concerted effort to monitor working conditions in over 700 factories in 42 countries (Watford, 2014, p. 12). The installation of a factory code of conduct, SHAPE (Safety Health, Attitude, People and Environment) now meant that the company was dedicated in its promise to introduce numerous changes in the company. Over time limits, air quality, minimum wage and fire safety were all part of this new scheme aimed at factory workers in South East Asian countries. Regulations could now be enforced in all its companies through regular monitoring and unbiased reports based on the findings.