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The Nike Company by daniel3

Conducting an analysis with an ethical lens
2 Suggestions by ishita

What are your recommendations and solutions for more ethical metrics? 

Nike must consider the monetary values it places on its main stakeholders, such as minimum wages and welfare costs targeted at improving their social and health conditions. Nike should also look into compensation methods in the developing countries where it does business. It should include wage standards in contracts with manufacturing partners. Such actions may cause a large loss in sales and profit margins. Yet the long-term impact will would be significant. In contrast, the positive impact on sales and market share could outweigh the negative impact on Nike's reputation and image.



  1. How does the issue affect the organisation’s ecological sustainability? Do building envelopes use more lighting, heating, and cooling energy than they create? How is waste managed? What about transportation? 

With the continued use of sweatshops, Nike and other multinational corporations give the impression that they are less concerned about the environment by shifting their manufacturing operations to countries where environmental regulations are less strict. Polluting surrounding environments and dumping hazardous waste and chemicals is more rampant in sweatshop locations, further threatening the natural ecosystem. Nike is among the leading environmental pollutants, courtesy of high greenhouse gas emissions in their sweatshops. Production, manufacturing, and finishing of the materials account for 70 percent of Nike's total carbon footprint (Nike Inc., 2021). Despite using certain sustainable fabrics, Nike overlooks wastewater discharges and has been denounced for failing to get rid of hazardous chemicals in its supply chain (Sharpes, 2021). 

Does the issue degrade or regenerate the natural systems it affects? How? 

Ecological responsibility has emerged as an additional dimension to the concept of corporate social responsibility to take care of the environmental element (Hanson-Rasmussen & Lauver, 2018, p. 3). The root cause of environmental degradation through the continued use of sweatshops by multinational corporations is the lack of universal laws and regulations that would require these companies to uphold environmental regeneration. 


  1. What are your recommendations and solutions for a more ethical ecological stance? 

A stringent approach requires the issuance of policies that would encourage both local and international markets to have products that are not associated with sweatshops. This would entail governments issuing corporations with a list of requirements for their manufacturing and supply chain. The enactment of universal laws and policies would be a step in the right direction towards the promotion of sustainable corporations. Nike should conduct independent audits of the requirements and thorough environmental due diligence on supplier factories to expose companies in breach of policies. This approach would ensure the partners understand that Nike does not condone ecological degradation. 


Staff Techniques 

How would you use the following techniques with the organisation’s staff to achieve your recommendations?


Creating and maintaining sustainable businesses requires understanding the role of leadership in addressing the personal outcomes of employees (Simiyu, 2015). Effective leaders must consider all factors that may influence the decisions of stakeholders in an organisation. Organisational behaviour and management disciplines have defined a list of leadership styles that leaders can use to maximise cooperation with their followers. Servant leadership remains an effective leadership style. Servant leadership is a leadership style where the person high up the hierarchy puts the needs of the subordinates first (Gandolfi & Stone, 2018, p. 262). By employing the concept of servant leadership, leaders in corporations such as Nike that make use of sweatshops would regard the needs of the employees, marking the end of the unpleasant attributes of a sweatshop.


ii. Bureaucracy 

Applying bureaucratic leadership and management favours strict rules, regulations, and a hierarchy of command throughout the company (Magallanes, Encarnacion, & Abun, 2021). Bureaucracy can be vital in the fight against the negative implications of sweatshops among multinational corporations by ensuring that all adhere to uniform rules and regulations. Bureaucracy lays down guidelines and procedures (Kante, 2019), making them applicable to upholding morality. All employees are expected to adhere to the rigid rules and regulations that are in place (Fata, 2020). The workers are oriented to follow strict rules. They are to never violate the rules and procedures that the company establishes (Fata, 2020).


iii. Rewards

Sweatshops use coercive measures while pursuing the company’s goals. This may be replaced with a more proactive method of encouraging people to perform to their full capacity by implementing an effective reward system. For instance, Nike has been accused of using force to subject employees in their offshore manufacturing facilities to compulsory overtime. According to Seng and Arumugam (2017), there is a positive correlation between financial rewards and employee job performance and can have immense influence compared to coercive means. With the right amount of compensation and reward systems put in place, these employees will work overtime without the need to invoke coercive means. This would create positive reactions to rewards from within and outside the business. 




Nike’s use of sweatshops paints a picture of an unethical company that disregards its purpose, people, long-term profits, and the planet. Using sweatshops in Nike’s offshore manufacturing can be analysed based on four different contexts that define the company’s ethical behaviours and sustainability: purpose, people, profit, and the planet. Nike has a strong overall company purpose on paper, but its use of sweatshops is damaging to its purpose. People are directly and indirectly affected by Nike’s use of sweatshops. The primary aim of sweatshops use can be viewed as lowering the cost of production while maximising the stakeholder profits, The long-term impact can implement severe damage to Nike’s competitive advantages. Judging by the widespread pollution in countries where they have been situated, sweatshops remain an ecological problem. In particular, effective leadership alongside bureaucracy and working reward systems can effectively offset the prevalence of sweatshops among multinational corporations like Nike.