Exploring the Utilization of Sweatshops: A Case Study of Nike's Labor Practices and Corporate Social Responsibility
Introduction
Sweatshops are commonplace. The corporations move the factories overseas where labor is cheaper so that gain the ability to lower the cost of operation. Nike has been criticized for utilizing sweatshops within Asia as the source of labor. The prime motive for companies to use sweatshops within the line of production is to lower the costs and hence maximize the profits (Bick, Halsey and Ekenga, 2018). The laws for minimum wage in established countries like Australia and the US force prime organizations in order to pay the employees a certain wage in correlation with the legislation. This paper mainly discusses the reasons behind the use of sweatshops by the companies.
Literature Review
These wet shops refer to the typically tiny manufacturing developments where employees work under unhygienic and unfair conditions of working. Many of the retailers of fast passion like Forever 21, H&M, and Nike receive shipments of new clothes season every day (Maiti, 2022). These brands have the ability to sell large amounts of clothing and the cell those are extremely low prices generally by contracting with the suppliers in the underdevelopment the cell those are extremely low prices generally by contracting with the suppliers in the underdevelopment the sale those are extremely low prices generally by contracting with the suppliers in the underdeveloped nation. Sweatshops are not be recent phenomenon and the media has forwarded it for decades. The industry of first fashion has complacently been in a system that faces the workers below subsistence to maximize their profit first up this model of business that focuses on selling lots of clothing at sustainable cost has left profit and yielded less to those who create them directly first stop to manufacture things inexpensively and quickly, the workers of sweatshop frequently children and women suffer meager pay and grueling workdays which do not cover the basic expenses, while providing them with cruel living and working circumstances. In various nations of manufacturing, including India China, and Bangladesh the minimum age just covers half the space of what a family requires in order to meet their needs (Nguyen, 2022). It has been found that in Bangladesh, the workers are paid nearly 33 cents per hour while the average wage in the sweatshops that are located in India is a maximum of 58 cents.
Various studies have shown that the working conditions of the sweatshops are unsafe, unhygienic, and poor since a large number of the sweatshops are located in poor nations with weak laws of labor and less control of government as the outcome when the workers attempt to challenge the rights or the work conditions, they risk losing the jobs (Park?Poaps, 2010). The employees in the garment industry are needed to put in around 14 to 16 hours per day, and a week and endure the verbal and sometimes the workers experience physical abuse from the managers. Often, it has been found that the employees are being exposed to harmful substances while they are working without adequate ventilation. Injuries and accidents are often identified in sweatshops. Sweatshops are mainly defined by the Department of Labor in the US as the factory that violates two or many more laws (Rouge, 2016). The sweatshops frequently have unreasonable hours, lack advantages for the workers, child labor, and unfair wages. The common products that are being manufactured in the sweatshops are coffee, cocoa, bricks, and cotton. There are various environmental impacts of sweatshops. The environmental impact of fast fashion mainly comprises the depletion of the emission of greenhouse gases, non-renewable sources, and utilization of huge amounts of energy and water. The production of plastic fibers into textiles in the procedure of energy-intensive which needs huge amounts of petroleum and releases volatile specifically matters and acids such as hydrogen chloride. In addition to this, cotton is not considered environmentally friendly in the process of manufacturing. Fast fashion has a huge impact on the environment. Impact former the industry holds various societal issues specifically in developing economies. The increasing demand of consumers for clothing has an important negative impact on humans along with a negative impact on the environment (Williams, 2022). Then the impact is integrated with the planned obsolescence of fashion brands, this ensures that the items are out much more quickly because of the poor quality of manufacturing.
Presentation of an actual case
Nike can be considered a huge athletic clothing and footwear company around the entire world, yet its practices of labor were illegal several times. Within the time period of the early 2000s and the end of the 1990s, acquisitions were placed over the company to apply sweatshops for making shoes and activewear. Although a slow response was provided by the organization initially, necessary measures were taken by the firm for enhancing employees’ operating conditions within its different factories. An effective allowance has been acquired by the company through this stage for regaining public trust as well as becoming a well-known brand within the industry of sportswear. The development of sneakers and sportswear is being outsourced by Nike to grow economies further for saving costs and using a cheap workforce to gain a major edge (Auburn 2014). This has given introduction to several sweatshops where workers were pressurized operating for extended hours under harsh working conditions with reduced wages. With this kind of illegal practice, initially, Nike did not accept its association stating less control was being obtained by it over some contracted factories. In 1992, after huge protests, more concrete measures were undertaken by the firm by establishing a department for enhancing factory conditions. This measure was not likely to create much impact for resolving this issue. There had been a continuation of struggles and barriers yet there was still a prevalence of several Nike Sweatshops (Carty 2001).
The extent of public backlash reached a greater extent between 1997-1998 thereby causing the brand of sportswear for laying off numerous workers. In the year 1999, the Fair Labor Association of Nike was built to protect the rights of employees as well as monitor the conduct code within factories of Nike. Between the time periods of 2000 to 2004, an auditing process was carried out in above 600 factories for occupational safety and health. An entire list of different factories where published by the organization in 2005. This included a detailed report of workers’ wages and working conditions and facilities of Nike. Since that time period, annual reports have been published by Nike with regard to their labor practices and sincere attempts have been made for redeeming previous mistakes and showcasing transparency within the business. Human rights were surely violated by the sweatshops of Nike. It was found that since the Scandal of Nike’s Sweat Shop took place, several nonprofit companies have been established for protecting garment workers. For instance, Team Sweat is one of the companies that protect and track the unlawful labor practices of Nike. Jim Keady within the year 2000 founded this company with the objective of ending this type of practice or injustice (Fraser & Van der Ven 2022). In the year 2005, Nike developed reports of corporate social responsibility by taking a vital path to commit to promoting transparency. CSR reports of Nike have even highlighted the continuous efforts of the brand for enhancing the working conditions of labor. Nike also took the step for maximizing its worker's minimum age as well as increasing the evaluation of its overseas factories.
Discussion and analysis applying theoretical perspectives
The deep involvement of Nike within sweatshop complexities created an adverse impact on the buying behavior of customers who are considered primary stakeholders of the organization. The image of the Nike organization was discolored thereby affecting the overall evaluation of the product. The company of Nike should have extended their steps and abided by the strategy of corporate social responsibility. The legitimacy theory is appropriate within the scenario of Nike as it can be used effectively for analyzing a company's behavior that tackles corporate social responsibility. It has been evident from analysis that legitimacy can be considered an assumption or perception where the organization of Nike has departed itself to maintain and follow societal norms and regulations. Legitimacy was still retained by it somehow because society was not able to notice the departure. Awareness was also not showcased to stakeholders with regard to the operations taking place within the subcontractors of Nike. The company had the ethical obligation to do so and this continued to that point of time when the circumstances were disclosed by the media (Hart 2017). Nevertheless, the claim of legitimacy within these circumstances was brought to the attention by workers and children within the sweatshops. They were at that time period not considered as the organization’s salient stakeholders therefore their claims were not true for Nike. Further, the decision was taken to implement the strategy to ignore them.
The company as well as it sweat factories together with the child labour problem are specific instances of a circumstance in which the firm was required to implement a proactive attitude in regards to resolving the issue without considering that it might be a lawful one for avoiding such initiative. A normative aspect sets this foundation yet there is also the presence of economic purposes. Within the initial stages like implemented and unit behavior with regards to the problem of sweat shrubs gradually the business has been pressurized for dealing with it in an active way as social activities groups and media for performing such things (Kolev 2019). By not taking into notice expectations of the society as well as maintaining a passive attitude could have cost a lot to the organisation because of having a poor reputation. Nike has been successful since the attempt made in 2005 to influence and promote corporate social responsibility for workers in the organization and protect their human rights to any extent. The solutions implemented by Nike's CSR system comprise for eradicating employment of under age and pressurized labour allowing association freedom by forming a union for workers preventing all kinds of discrimination offering workers fair compensation and eliminating excessive overtime. An innovative CSR strategy has been developed following Nike’s Impact Report during the financial year 2020. This is when a positive difference has been created by Nike around the whole world by undergoing potential sustainable practices (Lucchini & Moisello 2019). Materials were sourced for footwear and apparel from various sustainable sources to maintain sustainability along with obtaining renewable energy completely. This also comprised cutting down the total waste and maximizing the recycling procedure.
Conclusion
Analyzing the above context, it has been found that most companies use sweatshops as a manner to lower the cost of production and increase their profits. These sweat shops frequently offer minimal regulation and cheap labor, permitting the companies to produce goods at a lower cost. This has the ability to make the products much more competitive in the marketplace. However, it is much more significant to note that the utilization of sweatshops is considered unethical and this can result in the exploitation of the workers, violation of the rights of labor, poor conditions of working, and many more. Many organizations and companies are working in order to address the problems and enhance the condition of working in the supply chain globally. It has been found that Nike was involved in using sweatshops. Therefore, it can be said that the companies that outsource production to developing countries in which the workers are not being protected by the policies of minimum wage are correlated with various legislations. For businesses, this mainly presents an opportunity for e financial growth as the inputs can be reduced and the outputs maximized, maximizing efficiency. However, this might also have some negative impacts on the entire organization in the form of a poor reputation for social responsibility, which would in turn lower competitiveness. The sweatshops incur some additional impacts on the society specifically those which are being subjected to the sweatshops. The employees in those societies receive minimal wages and they are generally forced to work in unsafe conditions.
Are you struggling to keep up with the demands of your academic journey? Don't worry, we've got your back!
Exam Question Bank is your trusted partner in achieving academic excellence for all kind of technical and non-technical subjects. Our comprehensive range of academic services is designed to cater to students at every level. Whether you're a high school student, a college undergraduate, or pursuing advanced studies, we have the expertise and resources to support you.
To connect with expert and ask your query click here Exam Question Bank
