...Nike: Sweatshops and Business Ethics (Adapted/summarised from original) By Charles Hill*, University of Washington Introduction: Nike is a global corporation, founded 1972, and now one of the leading marketers of athletic shoes and apparel. It has a turnover of $10bn and operates in some 140 countries. Nike does not manufacture anything. It focuses on design and marketing and contracts out (outsources) its manufacturing to some 600 factories worldwide, employing over half a million people. For over a decade, Nike has been dogged by bad publicity and persistent accusations that that its products are made in “sweatshops” where workers, many of them children, slave away in hazardous conditions for below subsistence wages. Nike’s wealth, its detractors claim, has been built on the backs of the world’s poor. To many, Nike is a symbol of the evils of globalisation. Nike has taken many steps to remedy the situation but admits there are still problems in overseas factories, despite laying down minimum standards of working conditions and pay, and having their standards independently audited. But the accusations, protests and bad press continue. The Case against Nike: In 1996 a CBS 48 Hours news reported from a factory near Ho Chi Min City (formerly Saigon, Vietnam) … The signs are everywhere of an American invasion in search of cheap labour. Millions of people who are literate, disciplined, are desperate for jobs. This is Niketown near what used to...
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...University of Phoenix Material Nike: The Sweatshop Debate Nike is in many ways the quintessential global corporation. Established in 1972 by former University of Oregon track star Phil Knight, Nike is now one of the leading marketers of athletic shoes and apparel on the planet. Today the company has $20 billion in annual revenues and sells its products in some 140 countries. Nike does not do any manufacturing. Rather, it designs and markets its products, while contracting for their manufacture from a global network of 600 factories scattered around the globe that employ some 650,000 people.1 This huge corporation has made Knight into one of the richest people in America. Nike’s marketing phrase, “Just Do It!” has become as recognizable in popular culture as its “swoosh” logo or the faces of its celebrity sponsors, such as Michael Jordan and Tiger Woods. For all of its successes, the company was dogged for more than a decade by repeated and persistent accusations that its products were made in “sweatshops” where workers, many of them children, slaved away in hazardous conditions for below-subsistence wages. Nike’s wealth, its detractors claimed, was built upon the backs of the world’s poor. For many, Nike had become a symbol of the evils of globalization—a rich Western corporation exploiting the world’s poor to provide expensive shoes and apparel to the pampered consumers of the developed world. Niketown stores became standard targets for antiglobalization protesters. Several...
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...symbol legend in the fashion industry. It also achieved supreme prestige and numerous milestone around the world. BONIA, this luxury brand is came from inspiration of Italy. It have three highlighting main principals which are Modent, Elegant and Contemporary. BONIA Group has a network of over 1,400 sales outlets and 170 standalone boutiques throughout the world including countries such as Malaysia, Singapore, Thailand, Cambodia, Vietnam, Myanmar, Indonesia, Japan, Taiwan, Kuwait and Saudi Arabia. BONIA listed entity on the Main Market of Bursa Malaysia Securities Berhad, the holding company of BONIA group that is primarily involved...
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...Case Study "Nike: The Sweatshop Debate" Sarah Martin MGT 448 July 27, 2011 Kenneth Peter Case Study "Nike: The Sweatshop Debate" “We’ve run the course – from establishing codes of conduct and pulling together an internal team to enforce it, to working external bodies to monitor factories and engaging with stakeholders” (Nikebiz, para. 2). The creation of this code of conduct came after serious allegations of using sweatshops with women and children working in hazardous conditions for less than minimum wage in overseas factories scattered across the globe to make their product. This paper uses the case study entitled, “Nike: The Sweatshop Debate,” to describe the legal, cultural, and ethical challenges that confront Nike’s global business. This paper will also determine the various roles that host governments have played as well as summarize the strategic and operational challenges that face global management for the Nike Corporation. Bill Bowerman, a track and field coach at the University of Oregon, and Phil Knight, a talented middle-distance runner from Portland, “shook hands to form Blue Ribbon Sports, pledged $500 each, and placed their first order of 300 pairs of shoes in January 1964” (Nikebiz, para. 1). In 1965, they hired their first employee, Jeff Johnson, to manage the growing requirements. In 1971, he conjured up the name Nike. According to the case study, the profits and success that the Nike Corporation has gained has affected hundreds of thousands of workers...
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...strong commitment from participants to implement the system. BSCI operates on the following principles: Committed: Our participants commit to implement the BSCI Code of Conduct as part of their business relations with suppliers, showing a willingness to improve the working conditions in their supply chain. Consistent: We offer a unique and uniform system for suppliers worldwide consisting of one Code of Conduct and one implementation process, ensuring consistency and comparability of audits. Comprehensive: The BSCI social compliance system is applicable to both large and small companies and covers all products (industrialised and primary production) sourced from any country. Development oriented: BSCI is not a certification scheme. We offer a step by step development approach that helps suppliers implement the Code of Conduct gradually. Suppliers who meet all BSCI requirements are encouraged to go further and achieve our best practice, the SA8000 social management system and certification developed by Social Accountability International (SAI). Credible: We only use external, experienced and independent auditing companies to perform audits. Focused on risk countries: We focus on risk countries * where violations of workers’ rights occur frequently. The main sourcing countries, based on audits performed, are China, Bangladesh, India, Turkey and Vietnam. Efficient: Our common database of suppliers creates efficiencies and avoids duplicating audits at factories already...
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...Company profile Basic infor Comfortdelgro is a land transport companies through the merger by the Comfort group and Delgro Corporation. Those two companies had started their business in 1970s. After merger, the Comfortdelgro has achieved significantly performance. Nowdays has become the second largest land transport company in the world and market leader in singapore. With the fleet size of more than 46,300 vehicles and operation in seven countries(China, the united kingdom, ireland, australia, malaysia and vietnam). The company’s business include bus, taxi, rail, car rental & leasing, automotive engineering services, vehicle inspection & testing services, driving centre, insurance broking services, outdoor advertising and car dealership. Its vision Its mission Global network Company history The history of Comfortdelgro can be traced back to 1 April 2003. The corporation was formed through the merger of Comfor Group and DelGro Corporation. In 2003, the world’s first fully automate underground heavy rail system started its service on 20 June, which is NorthEast line. NEL is operated by the subsidiary of ComfortDelgro company-SBS transit. Moreover, the Group take 70% stake in Vinataxi Company Limited which provide taxi services in Ho Chi Minh City. In 2004 VICOM Ltd has, on 22 March 2004, entered into a conditional sale & purchase agreement with CIAS Enterprises Pte Ltd(CIAS) and ALPHA container Services Pte Ltd(ALPHA) to acquire...
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...not matching minimum local labor laws. Long working hours. Working environment very poor. Minimum Wage rate very low. Safety & Security compliances not followed. Case Against Nike In search of cheap labor Nike looks factories as such in target countries where minimum wage level is not set. Targeting literate , disciplined and desperate job seekers. Mostly young women are hired. Labors don’t share Nike’s huge profit. They work 6 days a week for only $40 a month - just 20 cents an hour. Attack on Nike’s Sub Contracting Some factories were employing 11 years old labors in Indonesia for their sneakers. Wage as low as 14 cent per hour. In Indonesia , China and Vietnam where Nike has their subcontracts are those countries where government prohibits independent unions, and set the minimum wage level rock bottom. Attack Continues Indonesian government admits that the minimum wage do not ensure enough to supply the basic need of one person , let alone a family. The minimum wage level was...
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...known companies have presented various cases to defend their positions on conducting business in the foreign country. One such example is a Nike sweatshop labor case that stirred up a large amount of controversy over ethical business practices. Even though Nike has attempted to recover from the bad press it received about the sweatshops, it still struggles to defeat the negative feelings from people across the United States. Thus, a summary of the case, the legal, cultural and ethical challenges, an understanding of the roles the host governments play, and the strategic and operational challenges faced are important to gain a thorough understanding of the issues and case. Most people could easily define Nike and are familiar with the products offered, like the customized options available in the Nike store online, Nike Sportswear, Nike Women, Nike Basketball, and Nike Football. These products, among others, have led Nike to a profit of $15 billion in 2006 and a catchy “Just Do It!” slogan (Hill, 2009). The company outsourced its manufacturing plants to several countries in order to lessen costs and become more efficient in productivity. The outrage and protests that followed were far from what Nike expected; the company was labeled as forcing “children to slave away in hazardous conditions for below-subsistence wages” (Hill, 2009). As a result, protestors of globalization and human rights activists criticized Nike for taking advantage of the...
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...SAN MIGUEL OWNERSHIP The company is majority-owned by San Miguel Corporation. Kirin Brewery Company, through its investment arm Kirin Holdings Co. Ltd, holds the most significant minority stake. Philippine mall magnate Henry Sy also has a stake in the company. Other top shareholders as of December 2009 are as follows:[5] Top 10 Shareholders of San Miguel Brewery, Inc. | Name | Shares | Percent | San Miguel Corporation | 7,859,324,270 | 51.000 | Kirin Holdings Co. Ltd. | 7,458,864,880 | 48.388 | PCD Nominee Corporation (Filipino) | 62,538,710 | 0.406 | Henry Sy | 12,500,000 | 0.081 | Syntrix Holdings Inc. | 12,500,000 | 0.081 | PCD Nominee Corporation (Non-Filipino) | 1,209,600 | 0.008 | Isias and/or Melinda Lumanta | 132,000 | 0.001 | Marilyn Maranon | 124,000 | 0.001 | Virgilio Salonoy | 82,000 | 0.001 | Fadil III | 63,000 | 0.001 | John Devela & Jay P Noy CO | 3,000 | 0.00001 | San Miguel Brewery, Inc. (PSE: SMB), a subsidiary of San Miguel Corporation, is the largest beer producer in the Philippines, with a market share of over 95% as of 2008.It has five breweries spread across the country producing eight beer brands, led by its flagship brand San Miguel. Locations/Subsidiaries No. 40 San Miguel Avenue, Mandaluyong City, Manila, Philippines Fax: 63 632 6323099 Distileria Bago Inc. 6/F San Miguel Properties Ctr., St. Francis St., St. Francis St, Mandaluyong City, Philippines Ginebra San Miguel, Inc. 3rd & 6th Floors...
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...Nike has become one of those global companies targeted by a broad range of campaigning pressure groups and journalists as a symbolic representation of the business in society. In Nikes case, the issues are those of human rights and conditions for workers in factories in developing countries. In the face of constant accusations, Nike has developed a considered response but the criticism of Nike still continues. Nike produces footwear, clothing, equipment and accessory products for the sports and athletic market. It is the largest seller of such garments in the world. It sells to approximately 19,000 retail accounts in the US, and then in approximately 140 countries around the world. Just about all of its products are manufactured by independent contractors with footwear products in particular being manufactured in developing countries. The company manufactures in China, Taiwan, Korea, and Mexico as well as in the US and in Italy. The Global Alliance report on the factories in Indonesia gave the following workforce profile: 58% of them are young adults between 20 and 24 years old, and 83% are women. Few have work-related skills when they arrive at the factory. Nike has around 700 contract factories, within which around 20% of the workers are creating Nike products. Conditions for these workers have been a source of heated debate, with allegations made by campaigns of poor conditions, with harassment and abuse. Nike has sought to respond to these allegations by putting into place...
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...RISK MANAGEMENT AND BAD DEBT CONTROLLING Case: ANZ Vietnam LAHTI UNIVERSITY OF APPLIED SCIENCES Degree program in International Business Thesis Spring 2013 Minh Thong To Lahti University of Applied Sciences Degree Programme in International Business MINH THONG, TO Credit risk management and bad debt controlling Case: ANZ Vietnam Bachelor’s Thesis in International Business, 53 pages, 3 pages of appendices Spring 2013 ABSTRACT It can be seen that the Vietnamese economy in the first decade of the 21st century has a significant development in the banking sector. Commercial banks represent a big role in this development. The banks’ capital rose rapidly and became an important factor in Vietnamese economic growth. However, a negative side always follows the result of any growth. Expanding operation leads to debt rate increase in most commercial banks. Especially bad debts rate rose rapidly. Bad debts became a serious problem for the Vietnamese economy. When the amount of bad debts increases to a particular point, it will hinder the development as well as the operations of the banks. Due to this issue, controlling the bad debt rate is hard work for all commercial banks. There is no model of solution for all banks. According to specific characteristic of each bank, specific solutions to control bad debt rate are provided. However, those solutions seem to be not as effective as expected due to many reasons. When Vietnam became an official member of the World Trade Organization...
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...mainly on the basis of the company's unappropriated profit (excess cash) and influenced by the company's long-term earning power. When cash surplus exists and is not needed by the firm, then management is expected to Payout some or all of those surplus earnings in the form of cash dividends or to repurchase the company's stock through a share buyback program. Management must also choose the form of the dividend distribution, generally as cash dividends or via a share buyback. Various factors may be taken into consideration: where shareholders must pay tax on dividends, firms may elect to retain earnings or to perform a stock buyback, in both cases increasing the value of shares outstanding. Alternatively, some companies will pay "dividends" from stock rather than in cash. Our group have selected 3 journals related to the dividend policy in our quest to understand the factors/determinant of the latter and its relationship with investment opportunities and corporate finance. Further the chosen journals concentrated on the research dividend policy affecting firm’s in the emerging market. The following are the reviews of the said journals. 2.0. Journal Review 1 Nguyen Thi Xuan Trang. (2012)....
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...Facts: Anne Aylor, Inc. sells classic, high-end fashion in the retail industry in approximately 584 locations in 46 states. Most of their merchandise is developed and designed within the company. They use 131 independent manufacturers in 19 different countries, including China, Philippines, Indonesia, India, and Vietnam. The stock was trading at $22.57 at the end of March, 2011. 1a) Materiality is different depending on the users of the financial statements (AS11). Debt and liquidity is more important to creditors and stockholders are more concerned with net earnings and growth. Establishing the overall audit strategy for the engagement and developing an audit plan is dependent on the type of users (AS9). An objective is to reduce risk (AS8); therefore, inherent risk is assessed before considering control risk. 1b) Thresholds are different based on the industry and the magnitude of that particular company. Materiality is much different in a small company in comparison to a significantly large company. Preliminary judgments about the effectiveness of internal control over financial reporting have an effect on the planning of the audit (AS5) in regards to materiality. 1c) The smallest materiality threshold used for planning is used to “provide reasonable assurance (AU230) that the financial statements taken as a whole are fairly presented in all material respects at the lowest cost.” 1d) Obtaining an understanding of the company, its environment, and internal control...
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...products and will summarize the strategic and operational challenges that Nike Managers face in dealing with the interworking of global business. Nike as well as other global companies in the industry has the option to manufacture their products domestically or internationally in either situation there are challenges. If a company chose to the domestic approach it could potentially be more expensive, however, the organization and its manufacturing facility contractors would have to adhere to U.S. labor and safety laws in the areas of wages, code of conduct, working conditions, and would be able to monitor these conditions. If the business decision is to operate overseas by outsourcing its manufacturing facilities then Nike can benefit from lower wage earners based on the wages the factories would agree to pay their workers. However, it would be difficult to properly monitor working conditions, wages and code of conduct policies and would have to...
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...many other human right organizations like the global exchange and many others published their reports against the Nike incorporation. In response to these accusations Nike took many steps that included appointing a work assessment officer named Andrew Young, a former US ambassador to the UN, and also taking steps against their subcontractors who don’t follow the child labor laws. On March 1998, Phil Knight in a conference declared their initiatives regarding to improve working conditions for the 500,000 people that make products for Nike through subcontractors. Those are given below: • Nike changed their minimum age limits from the International Labor Organization. But their existing workers employ under the former limits. • Nike contract factory will be audit by PricewaterhouseCoopers who specially trained on the code of conduct Owner’s Manual and audit or monitoring. • The next one is that ensure workers around the globe are...
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