When it comes to corporate social responsibility, American companies know first-hand that any remotely controversial decision they make will come under rapid fire. And no company is more familiar with this than Nike.
In the mid-90s, Nike was largely the focus of human rights and labor condition issues. And rightly so. Child labor and employee abuse are serious allegations, and while Nike may not have owned the factories where these conditions were reported, they are responsible for ensuring a safe and fair environment for the 20+% of the factory employees who were involved in manufacturing Nike products.
When these issues surfaced in America there were protests. There were boycotts. There was bad publicity a-plenty, and when business was impacted enough for shareholders to take note, Nike took responsibility and employed new techniques to prevent – at least as much as possible – worker abuse and child labor in overseas factories. The company also, albeit reluctantly, divulged the locations of their overseas factories and allowed the formation of garment worker unions.
Now, Nike has done it again. Actually, let me rephrase. Nike didn’t do it again. Nike didn’t close the Hugger and Vision Tex factories in Honduras. These factories closed unexpectedly in January 2009, leaving 1,800 Hondurans unemployed. These factories also failed to pay more than $2 million in severance to their employees.
In the end, protests and boycotts on more than 40 college campuses across the country forced Nike to pay $1.5 million into a relief fund for the Honduran workers. Of its own volition, Nike will also work with Honduran suppliers to offer vocational training programs while prioritizing the re-hiring of Hugger and Vision Tex employee as new positions become available.
And this is the price Nike will pay to reinstate licensing deals with Cornell University and the University of Wisconsin. This is the price that Nike will pay to restore its public image. The $1.5 million going into the relief fund is far less than what Nike would lose from boycotts and lost licensing deals with universities. It is far less than what it would lose in sales due to a (re-)tarnished reputation.
But is it right?
It doesn’t matter. This is the price that American corporations must pay. Nike is not the first company to make right something that they didn’t make wrong – and they won’t be the last.
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ReplyDeleteAmerican corporations such as Nike are only going to act in a way that supports human rights if there is a monetary incentive to do so. Since consumers are the demand and that is where the money lies, it is only natural that Universities being so large have significant leverage over the market, especially in sports apparel considering the popularity and demand for sports gear among college sports. With campaigns at Bridgewater State college our bookstore is now sweat-free and a majority of the coffee is fair trade. We are the consumers and if we exhibit to the college and companies that we value fair treatment of workers, then that is something they must provide in their product, and unfortunately it is not because it is the right thing to do but simply because it is more profitable. As the world is run by a piece of paper no more than 5 inches, man will not appreciate nature until he realizes that this small five inch piece of paper only serves value because it is value that we place on it. Value should be placed in human life, animal life, and the environment in which we live. These things are irreplaceable and not measurable in dollars or cents.
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