Business ethics is the study which comprises the environment of business in consideration with the polices, morals and ethic related problems (George, 2011). These are the standard values of an individual or a group in an organization. Ethics are concluded as the standards or rules which are use to govern the daily decision policies of the business. The present report is based NIKE which is a large multinational corporation situated in UK. Company presents a large and diversified variety of athletic products. The major range of dealing products are athletic footwear, apparel, sports equipment and recreational products (Nike ne
The below-written report deals with business ethic and also assess the role of the company as moral agent. Furthermore it will help in presenting the current ethical issues which can affect the business organization. In addition report will help the company to improve their ethics and also ensure the employee-employer relationship.
1.1 Role of the company as Moral agent
Every organization should have morale and accordingly it performs business in order to create a competitive edge in the marketplace. Business are responsible towards many things like environment, local community and workforce who are associated with business. The support from corporation to all this party tend to give upward direction to business so as to ensure long survival of the same with increased rate of return. However, some of the corporation might adopt negligence approach towards ethical conduct but they has to affect from its negative effect in long run. It is because local community do not allow corporations to pollute environment as it affects their health to a great extent. Owing to this, every corporation give return in term of corporate social activities and employment as well as other related practices by working ethically. NIKE act as moral agent in the business environment. Company sets some ethical practices which are as follows:
Justice Practice:- Company collaborate with their employees and make the justice for the any wrong deed practiced in the workplace.
Integrity Practice:- NIKE practice integrity which courage the right work despite of the majority population. Integrity practice supports the employees to get involve in morally right workings (Trevino and Nelson, 2010).
Confidentiality and Privacy Practices:- The company ensures the security of the information generated by the employee's personal and customer's personal data.
Self-Control Practices:- NIKE create an environment where they practice self-control among the internal and external forces. The self-controlled and discipline workforce can enhance more productivity and profitability for the company (Weiss, 2014).
Revolution in Motion:- NIKE has bring a revolution in the footwear industry. Company is again and again involved in the creating innovation in their products which are attracting customers.
1.2 Employee involvement and empowerment
NIKE can enhance the ethic in the workplace by the involvement of employees and also by empowering them in decision-making process (Hoffman, Frederick and Schwartz, 2014). Company can develop these practices by entertaining some basic activities. Some of those activities for both employee involvement and empowerment are discussed below:
Development of employee's involvement: employees participation bring the motivated staff to actively react to the current job and also to improve the future production by the company (Shaw, 2016). This also enhance the employee's potential of working which made the way easy to reach the goal faster. For initiating employee's involvement, NIKE can create an environment where employees can make informal communication and can also have the direct communication with the higher authorities of the company. This direct contact will help the company in developing the employee's participation (Tseng and et.al., 2010). Similarly, NIKE can also arrange general meeting where employees can put their ideas in front of the top management of the company. Under this meeting company can inform the employees about the supreme goal of the company and can also disclose there innovations with the employees. In addition NIKE can organize social event like sports events or get-together parties for employees. This initiate will bring employees involvement in the company.
Development of empowerment among employees: Empowerment means that the to recognize the power of the employee and assign the best suitable job (Brenkert, 2010). For empowering employees, management of NIKE plays a vital role as they oversee the work of the employees. First management ensures that the employees are well-educated about their job and also aware about the issue-solving strategies then only they assign them with the power of decision making. For developing empowerment, NIKE can involve practicing welfare programs and development programs. Under which management authorities can train their employees about their jobs and also about other practices of the company. These programs includes the goodness of employees which is proven to be an ethical practice by the company. Innovation in techniques of company can bring empowerment among the employees (Grassl and Habisch, 2011). Company can establish specific responsibilities and roles for the employees so to initiate coordinated and clear work at the workplace. By appreciating the efforts of the employees, company can enhance the employee empowerment. NIKE can make the efforts to celebrate the achievements of the employees of their company. Management can also develop the empowerment by assigning right job for right and efficient employee (Fassin and Buelens, 2011).
1.3 Unethical practices by NIKE
NIKE although being a brand name have involved themselves in some unethical issue till the time. Some of the issues are as follows:
Ethical Dilemma: 2013 Indonesia, the worker are forced to work overtime. They had to work for 60 hours per week and if refused to work then they were punished for the same. NIKE had hire Indonesian military officers who for the employees to work over time in minimum wages of that time. The workers of Converse shoes ( Owned brand of NIKE) had also claimed that the supervisor was involved in unethical practices by slapping the labor, throwing shoes and by using abusive language at the workplace for the workers.
Issue of Sweat Shops: The sweat shops is the place where employees of NIKE company do not get the hygienic and safe working environment. This type of environment cause worker's to get faint from heat, exhaustion, poor nutrition and fumes during their working time period. Women employees of NIKE were also the victim of the unethical practices. While wearing regular shoes at the workplace women were punished to run around the factory area in the hot sunny day. Women found harm and hurt of the practice and were admitted to the hospitals. NIKE was involved in this sort of unethical issue and made the people revolutionary against themselves (How Nike Solved Its Sweatshop Problem, 2016).
NIKE entertaining Child Labor: In Pakistan, NIKE was found guilty for practicing child labor. There was an strict law meant against child labor and slavery in Pakistan. Officers of Pakistan founded that more than 200 children were working the NIKE factory where some children were below the age of 5 years. Many people and organizations of the country and worldwide have protested against the company. The student groups had also organize the campaigning event which also showed their protect against NIKE's child labor practices.
Darker side of NIKE: The other unethical issues practiced by NIKE involves the shifting of jobs from parent nation to overseas which enhance the unethical issues and also made the millions of labor unemployed in the nation. Some other acts of NIKE were harassment of labor at workplace by supervisors and socially injustice.
Furthermore, other organization also having unethical practices which affect their operation to a great extent. For instance, British Petroleum affected environment due to its oil spill disaster in many times. Here, company lost many of its employees and wild as well as sea and marine life get affected due to continuous oil spill. However, British Airways broke down the rule of government related to competition policy. It was involved in unethical practices like price fixed which create negative environment of market, Therefore, unethical practices of several corporation has direct impact on their image. This might has negative impact of firm for longer time for which banks many also face issues in granting loan or finance.
1.4 Improve the ethics of their operations whilst meeting objective and ensuring good employer/employee relationships
The company can improve their ethical practice in meeting the objectives and also in managing healthy employee and supervisor relationship by solving their unethical controversies. To rectify the deeds, company can follow below given practice:
Company was before involved in the issue of sweat shop which is against the health and safety practices. Company should set guidelines for healthy and safety measures where an safe, secure and hygienic environment should be provided to the employees for working (Ma, 2010). The company should provide safe residential facilities to the employees who are working as the migrants. Before company was seen entertaining low wages working labor where employees were not getting the compensation according to their work. Company should now ensures that they are providing compensation according to the work done by the employee. In 2013 company was seen forcing their labor for 60 hours work per week which is the more than enough work by the employee. To rectify this company can now set their working hours according to legal working hours set by the nation government (Giacalone and Promislo, 2013). Company should also provide remuneration for the overtime working. NIKE can set rules for the supervisors that they can not force the employees to work overtime. Company can provide legal mandated benefits to the employees. NIKE can also provide them with the facilities like housing, meal, transportation, health care, child care, paid leaves, vacations, no discrimination and social security.
Company can make more use of Eco-friendly product which have good impact over the environment. Company should follow the laws made by the government of maintaining the balance in the environment (Dierksmeier, 2011). They can also conduct improving sessions for minimizing the impact over the environment of the concern nation. In the past company's supervisors were claimed as the abusive and violent leaders. For ensuring good supervisor and employee relationship management can initiate the practices where they can develop employee involvement and also empower their employees to the best (Provis, 2010). By this practice NIKE initiate individual dignity in the workplace. They should also practice the no harassment activities and provide the employees with the rights for free association. Company can form an environment where employees can get involve in informal communication with the employers which will help in enhancing their relationship. Company should make documents like code of conduct which presents the information regarding the company's ethical polices which are to be discussed by the internal and external environment of NIKE.
Furthermore, company should focus on its strategies and tactics in order to order to behave ethically. It will further assist corporation to enhance overall rate of return with ethical conduct and meeting expectation of buyers associated with business. Similarly, business can focus on employment law and accordingly child labour be prohibited strictly. It can be critically evaluated that inclusion of such kind of unethical practices must not be allowed at workplace as it affect performance of business by destroying its image. In addition to this, CSR activities should be conducted by firm as it pollute environment by operating high-tech machinery etc. Owing to this, HR of corporation must follow effective strategies to contribute towards making environment clean and safe. At the same time personnel must be provided training to address issues of customers and offer them quality products. They should be mis-guided by placing wrong advertisement. Hence, appropriate information must be placed in advertisement and all so as to ensure ethical conduct of business in the marketplace.
1.5 Code of ethics
Ethical code is the set of written document which is used as a guideline for the management and employees of the company. These documents help the workforce of the company to get their action to be more indulge ethical and primary standards. On the bases of unethical deeds by the company, a suitable code of ethic is conducted below:
1. Ensure confidentiality: NIKE, to sustain the ethical code can ensure the privacy of their employees and customers both. They can not entertain any misuse of private information to go out of the company premises (Norman, 2011). Company can form standards which can help them in taking strict actions against the person at fault. These standards can ensure the confidentiality of the information and data of the employees.
2. Professional Conduct: NIKE's employees can entertain high standard of professionalism and responsiveness at the workplace. Company can use ethical marketing practice under which they have to present real facts in front of the general public. They can also organize time to time general meetings where they can inform their stakeholders about the original current financial position of the company (Goodstein and Butterfield, 2010). Any false or unethical practices can not be entertain by NIKE.
3. Quality of Services: NIKE have involved themselves in many controversies which affected the goodwill of the company. By serving the best quality product and services can bring the fame name back. Quality of service also includes the ethical efforts made by the company in context of their employees and clients (George, 2011).
4. Moral and Legal Standards: The company should more entertain the moral and legal standards which can allow the company to involve ethical practices in the workplace (Trevino and Nelson, 2010). There are many unethical deeds of the company which are to be rectified. For example, NIKE have made the unethical practice of child labor in Pakistan where they used children below 5 year for factory work. Company can make standards where they should not employee the labor below the age of 15 years. Even they can make same strict regulation for every subsidiary company.
5. Impartiality and objectivity- Employees are the main link between the customer and the management. Company can organize programs where they can educate their employees in maintain a healthy relationship with the customers (Hoffman, Frederick and Schwartz, 2014). NIKE can train their employees about how to convince buyer and how present their products in front of the customer. Furthermore, objectives of business must be communicated with personnel without any kind of partiality.
6. Meeting users' needs- Nike need to behave ethically by offering products and services in accordance with requirement of business. At this juncture, research and developing activities are used to incorporate views of users in producing proper products and services.
7. Integrity- Integrity refers to association of different parties involved in business such as employees, customers, shareholders and suppliers as well as other related parties. Here, corporation ensures to take views of all parties in taking decision related to implementation of any corporate strategy.
8. Proportionate Burden- The burden of NIKE is shared among all workforce such as middle level, lower and upper level management, Unethical practices are avoided so as to enhance satisfaction level of personnel.
9. Resources- Here, company need to employ necessary resources on regular basis such as raw material and finished goods. Along with that, other basic amenities should also be provided to workforce through which they get comfortable environment and render good quality to end users.
10. Frankness and Accessibility- Here, workforce must be provided authority share their issues with management. Owing to this, organizational culture must be developed accordingly thereby personnel become frank and raise their queries to get their issues solved.
The aforementioned report concludes the facts about the unethical practices of the company in the environment. It presents the impact over the working of the company which made them to settle the controversies. In addition the report will show the improvement which are to be taken by the company so to ensure more ethical practices over the workplace which will also create good relationship between employer and employees.
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