Answered Essay: The company is Nike and the ethical issue is underage workers. https://www.wsj.com/articles/cambodia

The company is Nike and the ethical issue is underage workers.

https://www.wsj.com/articles/cambodia-factories-grapple-with-issue-of-underage-workers-1388356528

What elements in the company’s culture, the external environment, or other factors influenced the ethical crisis? If it was portrayed in the media, how was it portrayed? Recommendation: What could the company have done to avoid the crisis in the first place? Propose how the company would have handled the crisis differently and the impact on the stakeholders discussed in the Crisis Details topic.

Expert Answer

Ans:

Often, many global companies like Nike outsource their manufacturing operations to third world countries for cost effectiveness. However, implementation and enforcement of laws prohibiting underage workers is very difficult in these parts of the world, given the sorry state of civic administration, law and order problems, widespread corruption annd grappling poverty that often forces the families to send their young children to work.

Back home, these organizations may have stricter regulations in place for ethical conduct, workplace safety and better working conditions, but when it comes to outsourcing, there have been many instances where monthly wages of a worker were found to be less than $80, an amount insufficient to buy one of those shoes, which he used to make in hundreds per day! The ethical crisis is the fallout of lack of enforcement of the same laws and inability to inculcate the same cultural elements in the allies’ evironment.

If it was portrayed in media, it would have accused the company of promoting unethical sourcing, turning a blind eye to the perils of those third world factories, while focussing only on profits that it earns through the process.

The best option for avoiding such crisis are continuous monitoring, surprise checks, bringing them under umbrella of UN ILO regulations, comprehensive auditing etc. The organization should be clear about its stand on the age of its workers, which can be decided, adhering to the legal requirements and in accordance with the local factors, but whatever agreed upon, should be strictly practiced.

The company could have started a apprenticeship program for the younger workers ( between 14-18 yrs for an example) that allows them to do subsidiary jobs and earn a bit so that they are not prompted to fall to bad choices, and are fully prepared to take full time regular jobs by the time they turn 18.

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