Photo taken from Article by Shelly Banjo
SUMMARY
The article entitled “Inside Nike’s Struggle to Balance Cost and
Worker Safety in Bangladesh” was written by Shelly Banjo of the Wall
Street Journal on April 21, 2014. According to the article, Nike’s head of
sustainable business --Hannah Jones-- had urged the company for years about the
dangers of using Bangladesh manufacturers. While Bangladesh features some of
the cheapest factories in the world[1],
the practices they use are a safety concern. Hannah and her colleagues visited
their manufacture base in Bangladesh and were dismayed to what they seen. “Rolls of
fabric were strewn across the production floor and some windows were bolted
shut.”[2]
After their encounter, the executives cut their ties with the company. Their
decision came not to long after another manufacturer in Bangladesh collapsed
and killed many workers. The author states that “Nike’s experience offers a
lesson in the difficulty of managing the twin priorities of controlling costs
and maintaining acceptable working conditions.”[3]
While Nike could begin to put safety controls in place, they wouldn’t be able
to guarantee working conditions would continue to be safe. Over the past few
years, Nike has increased wages in some factories and improved some features.
OPINION
It has become increasingly evident that Nike, and other companies like
it, have expediently taken advantage of impoverished countries lax labour laws
in order to increase their gross margin. A pair of Nike Air Jordan’s can
retail for $350; meanwhile, a worker may make 6 cents on the hour to produce
it. I agree with a statement made in the article. “Ignorance is not bliss. You
have to understand the systemic issues and work with factory partners to solve
them.”[4] While
Nike may think they have no control in guaranteeing the procedures for safety
they put into place will continue when they are not there, they could easily
hire a representative in Bangladesh to oversee such actions. They could also make
periodic surprise trips to ensure their manufacturer is adhering to the
policies put in place. There are a few options for this multi-million dollar
company.
I think that even if Nike lost a few dollars at first to ensure their
practices were ethical, they would stand to gain much more once people
understand what their brand is trying to do. Although Nike does not have a
legal obligation to ensure the general health and well-being of their
manufacturer’s workers, it would help with public perception if they
implemented safety conditions and required a minimum wage for workers.
Otherwise, Nike’s continued negligence could potentially lead to brand erosion,
since people will not want to buy their products.
QUESTIONS/FEEDBACK
1) After reading this
summary, do you think the same about your Nike garnets (if you own any)?
2) Do you believe that the
use of overseas manufacturers had given Nike a bad reputation?
3) After the collapse of a
manufacturer last year, many companies pulled their production out of
Bangladesh. Do you think Nike should completely pull all their production out
of Bangladesh or just the one company they already did?
REFERENCES
Banjo, Shelly. "Inside Nike’s Struggle to Balance cost and
Worker Safety in Bangladesh" Wall Street Journal, 21
Apr. 2014. Web. <http://online.wsj.com/news/articles/SB10001424052702303873604579493502231397942>.
After reading this email I do think a little more negatively of Nike. I think that the use of over seas manufacturing has given Nike a bad reputation manly because of the unsafe working conditions and the low wages that are paid to the employees. My opinion is that if Nike wants to repair its bad reputation that it needs to pull out of Bangladesh completely.
ReplyDeleteThanks for your comment Jennifer. I believe they should try to increase wages and help the overall sub-par conditions experienced in these factories if they can before completely pulling out.
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