Case Study

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1. Should Nike be held responsible for working conditions in foreign factories that it does not own, but where sub-contractors make product for Nike?

Yes, but I do not believe that the firm is 100% responsible since it is the sub-contractors who operate and create conditions for workers. Low-cost manufacturing is Nike's strategy, and it is realized by outsourcing the manufacturing process to cheap labor countries. If Nike were responsible for all of working conditions of workers at sub-contractors' factories, it would cost more to make shoes.   However, I think that Nike should monitor minimum working conditions so that workers will not die from Karachi, which might be lead to a big issue.

Some people probably think that designing and marketing its products is what Nike is responsible for. But outsourcing its manufacturing divisions into foreign countries doesn´t release Nike from the responsibility. During a developing process manufacturing is one of the most important intermediate steps and because of that it belongs to Nike´s responsibilities, no matter if they own the manufacturer or not. Everybody knows that it is hard to keep the overview about every developing stage but if you decide to put this step into a foreign country, you have to find a way of taking the control. So yes, Nike should be held responsible for working conditions in foreign factories that it does not own, but of course you have to weigh how much influence a company like Nike can have regarding working conditions. Establishing an independent monitoring association like the “Fair Labor Association” (FLA) is a good way to improve bad labor standards.

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? Nike should hold the standards regarding safety and working conditions that are prevailing in that country. However, when the sweatshop...
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