MR wang Essay

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Executive Summary…………………………………………………………………………2

Executive Summary

NIKE is out-sourcing its product to different suppliers. There are more than 660,000 formal employees working in the more than 900 plants where are located in more than 50 countries, including China, America, Indonesia, Vietnam and Pakistan. The main employees are women, aged form 19 to 25. NIKE suppliers are located in various positions because of quota allocation, factory capacity, quality and pricing. NIKE supply chain is very large and complex due to different culture, social and economy. So it is hard for NKE to manage its suppliers (Stabile, 2000). This is an excuse for Nike to escape social responsibility. NIKE had affected many countries’ social sustainability. In the Vietnam NIKE’s plant, The NIKE’s employees work at the factory where the carcinogen in the air reaches Vietnamese standard of 6 to 177 times and endanger employee’s health. What is more, the suppliers pay lower than the minimum wage required by Vietnam’s law and suppliers employ child labour to produce soccer ball in Pakistan. These appalling events are happened in NIKE factory. Although, NIKE attempted to change these situations which NIKE arranges many supervisors to suppliers’ plant to monitor, the situation had not changed. The main issue is suppliers’ profit, not just depend on monitoring can solve these issue. Only improving the profit of suppliers can totally solve these issues. So this report offers three recommendations to solve those incidents. Firstly, NIKE should offer reward policies to suppliers to improve their working condition, increase staff welfare and forbid to using child labour. Secondly, NIKE should offer more low-interest loan to help suppliers improve these facilities and working condition. Finally, NIKE should donate more funds to help local children to attend school and improve the skill of produce.

1. Introduction
Nike is hailed as the new world in recent 20 years to create the most successful consumer goods companies. NIKE is the largest sports shoes firm in the world. There are more than 36 percent of the share of sport shoes market in America and more than 33 percent of the share of global sport footwear market (Petrecca and Howard, 2005). By the year 2004, NIKE had about $12.2 billion in revenues, $6.5 billion came from footwear sales and US$3.5 billion from apparel respectively. At the same year, NIKE own 800 suppliers and employ more than 600,000 employees in 51 countries. NIKE direct manages employees only 24,291 who majority work in America. All other employees are worked in independent suppliers (Locke et al., 2007). NIKE always presents a good public image, including offer donating equipments and charity to poor family or country. However, this behaviour can’t hide NIKE ugly face. Nike's production facilities in developing countries, it is characterized by the use of very cheap labor, autocratic government, a lack of human right and trade union movement, in order to maximum profit. AS a famous sport brand, NIKE lacks responsible for social sustainability because NIKE pretends not know the behavious of its suppliers, including suppliers offer human rights issues rampant, poor working conditions, low wages and child labour. The most serious is that after these dismal things are reported, NIKE still refused to accept any responsibility because of various labour and environmental and health problems, finding at their supplier’s factories. This report will analysis the current issue, happening in NIKE suppliers. Firstly, the report will describe the situation of Nike. Secondly, the report will detail describe the poor working condition, low wages and child labour which happened in NIKE oversea suppliers and the social sustainability had been harmed by NIKE. Thirdly, NIKE through the supervisory system of management of each supplier factories, but didn't have effect. Fourthly, this
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