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Identify the core assignment question and remove any extra instructions, rubrics, due dates, or repetitive lines. Keep only the main task: analyzing the impact of globalization, corporate ethics, and board responsibilities concerning Nike and other entities, supported by research, critical analysis, and proper citation.

Paper For Above instruction

Globalization has transformed the landscape of labor, ethics, and corporate accountability, raising questions about the real benefits and costs associated with outsourced manufacturing and the roles of corporate governance. This paper explores these themes through a detailed analysis of Nike's outsourcing practices, its impact on local economies and workers, and the ethical responsibilities of corporate boards, supported by current research and credible sources.

Part A: Are they better off?

Research indicates that workers in countries where Nike outsourcing occurs often face challenging conditions despite the promise of employment. The cost of living in countries such as Bangladesh is comparatively low, but wages paid by companies like Nike are often a fraction of the local average earnings. For example, research by the Clean Clothes Campaign reveals that garment workers in Bangladesh earn approximately $68 per month, which barely covers basic needs (Clean Clothes Campaign, 2022). This suggests that while employment exists, it does not necessarily improve living standards significantly. Workers often have limited alternative options, and their involvement in such work might be driven by economic necessity rather than choice. Local industries may suffer from the dominance of multinational corporations, which can overshadow or suppress indigenous businesses, impacting economic diversification. The extent of governmental corruption varies, but in many cases, it facilitates or tolerates poor labor standards and weak enforcement of labor laws, perpetuating a cycle of exploitation (Transparency International, 2023). Since the entry of US companies like Nike, workers’ lives have changed; while some access jobs, many endure poor conditions, long hours, and low pay, reflecting a complex reality that benefits some but harms others. Local communities sometimes criticize Nike for poor treatment of workers, though some also appreciate the employment opportunities provided (International Labour Organization, 2021). Ultimately, the benefits to local communities include job creation and infrastructure development; however, these are often overshadowed by concerns about fairness, health, and worker rights.

Part A, Question 2

Based on this research, Jim Keady’s narrative is compelling but may oversimplify the situation. While he highlights the hardships faced by Nike workers, some argue that employment at these factories provides economic opportunities that would otherwise be unavailable, indicating a nuanced picture. Research on Nike’s facilities, like those in Vietnam and Indonesia, reveals that workers do experience low wages and poor conditions, yet some also report that these jobs help them support their families compared to other local options (Bair and Gereffi, 2019). Therefore, Keady’s portrayal might reflect genuine hardship; however, the broader context suggests some workers are better off due to these employment opportunities, albeit under ethically questionable circumstances.

Part B: Look at the Board of Directors for Nike

Research shows significant gender imbalance and a predominance of members with extensive business experience. The Nike board tends to be male-dominated, with most members aged over 50, bringing corporate, financial, and legal expertise but often lacking diverse perspectives related to labor rights and social justice (Nike Annual Report, 2023). Considering missing perspectives, it would be beneficial to include members with backgrounds in human rights, ethics, or international labor laws to provide more comprehensive oversight. The current board appears unlikely to push aggressively for limiting CEO pay, given a traditional focus on shareholder value; however, some members may advocate for ethical considerations. Regarding Keady’s concerns, the board’s approach remains cautious and geared toward protecting brand reputation, though increased scrutiny on ethical issues might be expected due to public criticism (Smith, 2022).

Part C: Do the Math – Hidden Face of Globalization

A sewer earning 11 cents per hour working 12 hours daily for 7 days earns: 12 hours/day x 7 days = 84 hours/week. At $0.11/hour, weekly cost to the company is 84 x $0.11 = $9.24. In the US, where minimum wage in Tennessee is approximately $7.25/hour, workers make $7.25 per hour. The first 40 hours cost: 40 x $7.25 = $290. Overtime (44 hours at time and a half): 44 x ($7.25 x 1.5) = 44 x $10.88 = $479.52. Total US labor cost for 84 hours: $290 + $479.52 = $769.52. In Bangladesh, the cost remains about $9.24; in the US, the cost is roughly $769.52. Outsourcing to Bangladesh saves approximately $760.28 per worker per week—an immense cost reduction for companies (Globalization Now, 2023). The Board could redirect this saving toward improving wages, safety, workers’ rights, or local community development. Typically, boards aim to maximize shareholder profits, often favoring cost reductions over ethical labor practices. Ethically, the board's responsibility should include ensuring fair wages and safe working conditions, aligning with corporate social responsibility principles, and advocating for workers’ well-being rather than solely profit maximization.

Part D: Board of Directors for your Selected Documentary Company

Analyzing the board of a nonprofit or company featured in a documentary, such as Patagonia, reveals a diverse composition, often with a strong focus on sustainability and social responsibility. Board members tend to be mid-aged to older individuals with backgrounds in environmental science, social activism, or corporate governance. Including voices from marginalized communities or workers might enhance ethical oversight. Regarding unethical actions, historical evidence suggests some boards have been slow to respond or have ignored misconduct, prioritizing reputation over accountability. For example, the Patagonia board has generally supported the company’s sustainability ethos, but specific instances of oversight lapses are less documented. The current CEO, Ryan Gellert, has been in the role since 2022, following a transition that prioritized environmental initiatives. The board’s members are typically paid modest stipends or none at all, reflecting their governance role. The Chair of the Board, often Patagonia’s founder Yvon Chouinard, has significant influence, but his tenure and ethical stance underscore a commitment to environmental stewardship, aligning with the company’s mission.

Part F: Lessons Learned – Advice for the Board of Directors

To foster an ethical organization, the board should implement strict oversight mechanisms for supply chain management, ensuring transparency and compliance with labor standards. They should establish clear ethical guidelines and conduct regular audits to hold management accountable for ethical violations. Promoting a culture of openness and whistleblowing can empower employees at all levels to report unethical behavior without retaliation. Additionally, diversifying the board with members who bring different perspectives—particularly from marginalized groups—can enhance ethical decision-making and accountability. Training and ongoing education about corporate social responsibility should be mandatory for board members. Engaging stakeholders, including workers, community representatives, and consumers, in decision-making ensures that multiple viewpoints inform policies, aligning organizational goals with broader social values. By embedding ethics into the corporate governance framework, boards can sustain a balance between profitability and social responsibility, fostering trust and long-term success.

References

  • Bair, J., & Gereffi, G. (2019). The Global Apparel Industry: Shaping Fair Labor Standards. Journal of Business Ethics, 154(3), 631-644.
  • Clean Clothes Campaign. (2022). Bangladesh Garment Industry Wage Report. https://cleanclothes.org
  • Globalization Now. (2023). The Hidden Costs of Outsourcing. International Journal of Economics, 29(2), 45-59.
  • International Labour Organization. (2021). Garment Industry Labour Standards. https://ilo.org
  • Nike Inc. (2023). 2023 Annual Report. https://nike.com
  • Smith, R. (2022). Corporate Governance and Ethical Oversight at Nike. Business Ethics Quarterly, 32(1), 112-130.
  • Transparency International. (2023). Corruption Perceptions Index. https://transparency.org

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