Multinational companies have been accused of exploitation of workers in developing nations despite the existence of labor laws not only in their countries of origin but also in the host nations. The challenge is that some of the labor practices are legal in the developing world. Some of the corrupt officials tolerate the companies as the systems in place are weak, and the government agencies are ineffective in implementing the policies in place ( Merk, 2019) . Nike is one of the companies that have been accused of using sweatshops in Asian countries where much of its production takes place. The practice is unethical because the company does not do so in the United States. With the right application of ethical standards, the company can prevent such occurrences in the future that have tarnished its name and reputation in the global market.
Facts
Nike is one of the North American multinational companies that have outsourced its operations in other countries such as China, Indonesia, Bangladesh, among others. The main reason for outsourcing is the low cost of labor, power, and raw materials in these countries as compared to the United States ( Merk, 2019) . However, the company’s practices have been equated to sweatshops. Employees operating in its factories not only work for long hours without breaks but also receive low wages that are not enough to take care of their essential needs. The employees also work in harsh conditions where they are exposed to high temperatures and hazardous chemical waste ( Merk, 2019) . The inhumane treatment of employees has been considered unethical, with the company taking measures to ensure compliance with the labor laws in those countries while also improving the working conditions of the employees. Although the company has not been cleared yet, the situation has improved in the recent past. More players have come on board to put pressure on companies such as Nike to respect its employees.
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Ethical Analysis
Sweatshops exploit employees by making them work for long hours and paying lower wages as compared to the fees paid for a similar job in the home countries. These multinational companies take advantage of the lack of strong unions and governmental support in developing countries. The argument against sweatshops is in line with Immanuel Kant's ethics as sweatshops tend to overlook human dignity as well as human rights ( Stern, 2015) . According to Kant, human beings are the end itself and should not be treated as a means to an end. Based on the second categorical imperative, human beings are an essential aspect, and multinational companies should not make use of the cheap labor that is found in the developing world. The idea is always to respect people at all times, and multinational companies need to make sure that their contractors do not violate the principles of deontological ethics, such as those established by Kant. Human beings have dignity unlike machines, and are hence priceless. One can infer that the multinational companies must make sure that the labor practices in those countries are not in any violation of human rights ( Stern, 2015) . Consequently, the company must ensure compliance with the rule of law in every country where they operate. Although Nike may not be directly involved in the ethical violations, it is the one that allows its contractors to use coercion at times, provide poor working conditions, and low wages to its employees.
Ethical Dilemma Resolution
The Blanchard and Peale method are the most ideal in describing Nike's actions in the specific Asian countries where the company has outsourced its production. The first test is on whether the effects of the company are legal. Although some of the elements such as low wages are legal in developing nations due to the economic situations in those countries, poor working conditions and the use of coercion or mistreatment of employees are not legal. Nike should make use of the positive law approach in everything that it does ( Pepsoski, 2016) . Sometimes, the company's contractors collude with corrupt officials in the nations at the expense of the employees who continuously struggle to meet their needs. It would be ideal for the company to lay down a code of ethics that must be followed across its supply chain. In particular, the contractors should adhere to labor laws in their countries.
The second test is whether the action is balanced in regards to stakeholder standards. Nike should not only take action on its side but should also ensure that its contractors adhere to the set rules in the code of ethics set by the company. For instance, when the cost of labor increased in China, most of the contractors moved to other Asian countries such as Bangladesh. Therefore, sweatshops may not be eradicated because the practice may shift to other countries ( Pepsoski, 2016) . Nike should come up with a system where the standards the company has kept in the developed nations are similar to the developing nations. The third test relates to moral relativism focusing on the effects of an action on an individual. The idea should be to treat others the same way one would want to be treated if the roles were reversed. Nike should consider its business activities and ask itself if it would want the operations to appear on the front page of a newspaper.
Personal Ethical Philosophy
My personal ethical philosophy leans towards deontological ethics, where humans should be treated with respect. Every action should be in the best interest of all the stakeholders and not only the principal shareholders, such as the case with Nike. To deal with an ethical dilemma, one should consider how they would define the problem if they were standing on the other side of the problem. The idea behind this philosophy is for multinational companies to avoid making assumptions on ethical responsibility and instead ensure that an ethical code of conduct is designed to deal with any risk of unethical behavior. Based on this philosophy, a company should not only be driven by profit in making decisions in regards to its operation but instead should focus on the wellbeing of other stakeholders. In this case, Nike should handle employees with respect and dignity and not just as a means to its profitability. It should balance its operations across the globe: whatever is done in the United States is replicated in the Asian countries where much of the production takes place.
Conclusion
Ethics forms an integral part of a company's operations in the modern market as consumers are more concerned with the production process of a company. Large multinational companies such as Nike have outsourced their production to Asian countries where the cost of labor is low. However, the company has been found to use sweatshops in its production process, with employees working for long hours with very minimal pay. Despite recovering from the reputational damage, much more can be done to clean its image. Multinational companies should make use of Kantian ethics in the management of employees, which enhances respect and dignity in the ways the employees are handled.
References
Merk, J. (2019). Subcontracted Capitalism, Nike, and Worker Dissent: A Rancièrian interpretation of the 'politics' of transnational labor governance in global production networks.
Pepsoski, D. M. (2016). Decision-Making and Ethics: A Study of Connecticut Superintendents . The University of Hartford.
Stern, R. (2015). Kantian ethics: Value, agency, and obligation . Oxford University Press, USA.
