BUSINESS ETHICS

SUBMITTED TO: SIR KHURRAM AZIZ FANI

SUBMITTED BY: MUHAMMAD ALEEM (2002042)

NIKE JUST NOT DO IT

Nike is one of the leading sports brands of the world. They are of the largest manufactures of
sports equipment as well. The slogan just do it says all about the organization that they are
present to make it happen for the sports society. The first thing that pops up in the mind of a
person when he or she hears about NIKE is one the finest and largest organization with the
best management teams in it.
When we compare NIKE and the ethics definitely a common person will say there will be no
ethical issues in such an organization because it been more than 56 years and still its on top.
The reality is that NIKE faces lots of ethical issues in its organization and NIKE is looking to
overcome these issues. Some of the issues are mentioned below:

Child Labor
Low wages to employees
Poor working condition
Environment Damaging.

Sweat Shop Problem:

Sweatshop is a pejorative term for a workplace that has socially unacceptable working
conditions. We can categorize this sweat shop problem as systematic ethical issues because it
affects the environment and many social factors.
To elaborate and understand what a sweat shop actually does, we compare it with slavery.
The NIKE shoe we wear of $250 is actually of $10 when it moves out from a sweat shop. We
said it as slavery because all the work is done by poor workers and in return they dont even
get their proper wage and all the profit is earned by the company. Child labor is another thing

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that is very common in these NIKE sweatshops. Under aged childeren are hired on low
salaries and are forced to work as much hard as they can.

If we talk about the wages which NIKE gives to their labor, it is very a disappointing story.
Lets take an example of the Indonesia; Nike has numerous factories stationed in Indonesia
with 171,000 Nike-affiliated workers and the third largest producer of Nike products. In
Indonesia the minimum wage was raised last year to the point where employees would be
making $4 a day. Several Nike factories in the country have applied to be exempt from the
new minimum wage law so they can continue to pay their workers a mere $3.70 per day. In
attempts to stay exempt from this law the company has hired high-ranking Indonesian
military officers to force employees to sign a petition stating the company did not have to pay
them the new wage.
If we compare sweatshop workers and the brand ambassadors we can see the difference that
how unethical is NIKE. For example Tiger Woods, NIKE is paying him enough money that
every second he could buy a house in the slums of Indonesia.
We can call such issue as corporate ethical issue as it is related to NIKE Corporation.

Another problem that sweatshops create is the usage of harmful chemicals. The workers are
completely exposed to these harmful chemicals in the factories. Burning of different
chemicals are done in order to make certain sports shoes and it is way too dangerous for the
surrounding. Talking more about Indonesia many sweatshops are situated in different
villages and they use to burn chemicals and scrap in the villages causing problems for the
people living there and especially the kids who used to play in these areas. Different results

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gave a result that because of this many lungs and breathing problems are rising in the kids of
the village.

Because of this problem NIKE has faced many legal actions. Nike mostly manufactures in
Vietnam, China, Indonesia and Bangladesh. Countries like Bangladesh may swallow this
problem without looking at this as a problem but China and other advance countries take
actions on it.
Many actions are been taken against these kind of activities. People protest against NIKE and
many consumers boycott NIKE products. Many nonprofit organizations are working against
NIKE and trying to give the rites of the NIKE workers back to them. But unfortunately
doesnt have a high impact of these certain things and still moving smoothly.

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NATIONAL FOODS TASTE & BLUFF OF PAKISTAN

National Foods in one of the leading food brand in Pakistan. As an organization we can give
it a high rate but we go deep inside it we find out that how they are getting their profits. There
are many ethical issues in this organization once we know that we will start looking at the
National foods products in a negative way. Following are some details of unethical things
happening in the organization. (The data is not taken from secondary source)
We all know every big organization has a purchasing team which has direct contact with
suppliers. This purchasing team has high salaries and their job is not much complicated but
still the unethical issue start from the purchasing. The National Foods give these purchasing
teams a budget to get the raw material from suppliers, for instance $1000, the company tells
them to bring the quality material in certain quantity and give the amount of money according
to that. The purchasing team shows lack of ethicalness here they fulfill the company one
demand of quantity but they purchase a low quality material which is cheaper obviously.
Lets say this type of material cost them $900 and remaining $100 goes in the pocket of the
purchasing team. These kind of purchasing teams have high links in the company and many
partners in that certain share which they earned through wrong way. These links helps this
purchasing team to cover such news and dont let anyone know about it especially the top
management. Having high salaries and high ranks and still doing such unethical deeds can
hurt the organization very badly. This is the individual ethical issue of the National Foods but
this is not the end there are many other corporate ethical issues in this organization discussed
below.
Purchasing was the start and we come towards manufacturing of the products. National Foods
is one of the high food brands and been awarded many times for its quality but some things
which I didnt know earlier and you are also not aware of are going on in the manufacturing
unit. Giving high quality products at low rates dont earn enough profits but giving moderate
quality and showing it as high quality product definitely gives high profits. Mixing different
kind of substances is done in the making of spices, mixing is done to increase the quantity.
(From one of the employees) the company uses animal feed in red chili powder and artificial
food colors in order to increase the quantity. National Foods is a strong organization in fact
its a wealthy organization and now a days in Pakistan the person with most wealth is the
most powerful person it might be the reason this same product, Red Chili Powder, got the
award for been the best food brand product. National Foods are pushing their marketing more
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and more but not doing well in their manufacturing, they are actually targeting the brains of
the customer not the taste. We can say that it is a corporate ethical issue of this organization.

Sales person is the last member of the organization who delivers the products to the retailers
or distributors. Well its the doorway of the product and should be done in proper way but
here as well unethical things are performed. Im going to discuss one unethical deed done by
the sales person. When sales persons are said to offer some secret discount packages to the
retailers the sales person mostly dont offer them to the retailers in fact that discounted
amount in their pockets and sell the product at its old price. This is done mostly because the
salaries of such sales persons are less so they keep the benefit, which is actually the benefit of
retailers and consumers. We can entitle this as individual ethical issue of National Foods.
National Foods are taking steps to eliminate such things from their company but problem is
that the system is not advance and in other words corrupt so this company is facing lots of
ethical issues.

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