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Good afternoon everyone. My name is Ailin and Im from Indonesia.

My major is
business administration and Im here for 1 semester. So, today I would like to
present about Nikes CSR Challenge and I have 3 agendas. Firstly I will talk about
the fact of Nikes CSR. Second is and lastly is my recommendation.
Regarding to Nikes CSR facts, I would like to talk about Nike CSR issues and Nike
CSR Challenge. Nike reported that a large percentage of their overseas factories
have their employees working in terrible environments for low pay and in unsanitary
health conditions. Research said that there were around 25% - 50% Nikes factory
prohibited their employees to go to toilet, and drink clean water. In addition, Nike
forced the employees to work one week full without holiday and work more than 60
hours per week. Not only that, but Nike also gave punishment to the employees who
were refusing overtime and Nike paid their wages lower than the legal minimum.
And if we take a look at Nike factory in Indonesia, there are other issues faced by.
Workers were being kicked and slapped by supervisors. At the PT Amara Footwear
factory located outside Jakarta, where another contractor makes Converse shoes, a
supervisor ordered six female workers to stand in the hot sun after they failed to
meet their target of 60 dozen pairs of shoes on time. Workers subjected to foul
language from the management. Workers subjected to sexual harassment, including
inappropriate touching and language. Workers subjected to having shoe parts
thrown at them. Hiring children under 16 yo as the workers. Workers were paid
under the legal minimum which was only $2.5 a day in Indonesia where the
minimum was $4-$4.5. Therefore, Nike should improve the labor standards in global
supply chains. Time by time, Nike struggles to create a better working condition to
attain better standards of social and environmental performance by applying
corporate social responsibility.
However, to run CSR well, Nike faced some challenges. Nikes major challenges is
related to the sustainability of stakeholders. Suppliers, analysing and measuring
CSR can be quite challenging to the suppliers in the developing countries since they
lack behind of incompetency supervisor to implement CSR. Employees, the
monitoring of labour conditions in the factories operated by its many overseas
suppliers seems very difficult. The company has been commended for its openness
in admitting to unacceptable practices and human rights, and its challenge now is
to eliminate child labour. Other than that, due to high demand and large-scale
production, which lead to receiving thousands of orders per day, may cause the
neglecting of CSR in abusing worker, working overtime, and poor working
conditions. Customers, that there is a consumer faction that does not trust the
transparency of the reports they publish on the issue related to consumer loyalty
and confidence. Unfortunately, it seems that even with complete transparency,
consumers need more effort on Nikes behalf and more time. This should be a
lesson to all future managers to never lose the clients trust, because gaining it
back could cost you the entire company. Environment, Nikes footprint is the
greatest source of CO2 and energy use especially water waste in which destroy
human health and environment. Lastly, regarding to leadership beyond borders,

Nike does not have a potential leader who can transcends the company boundaries
in order to deal with the CSR issues.
Now, lets moving on the second point, which is about the discussion.
MNCs in Apparel Industry. Social responsibility has always been an important factor
to a companys long-term performance and sustainability. This has become
particularly important within the apparel industry, which has developed a stigma
due its use of sweatshops over the last several years. Apparel industry available do
not aware about the importance of social responsibility, since the demand of
apparel is so high; they should meet their demands by ignoring the workers human
right lead to labor abuse.
Nikes Awareness. Nike became more aware towards the importance of social
responsibility due to several factors. First is that because there was an antisweatshop campaign called Just Dont Do It which has done by university students
in Canada and US where they demand Nike to pay a living wage, one not based on
overtime. Promote working conditions consistent with human rights. Secondly, it is
due to the lawsuit of Serikat Pekerja Nasional, it is a trade union representing
workers at Nike factory in Indonesia, PT Nikomas. PT Nikomas should pay $1million
in overtime compensation to about 4500 indonesian workers over the past two
years. Thus, Nike learned the dangers of not engaging and listening the
stakeholders by conducting and concerning the corporate social responsibility. Nike
aims to bring more sustainable materials that can create positive effect on people
and planet.
Nikes action.
Nikes action taken with respect to Planet are reducing emission CO2, reducing
energy consumption, reducing water consumption, and reducing material waste,
thus Nike developed new system and new way in dyeing systems, the using of
detergents and other chemicals. Other than that, Nike has tried to reuse a shoe in
order to be recycled into NIKE Grind consisted of outdoor and indoor tyles. Nike also
recycles plastic water bottles in order to make jerseys. In addition, Nikes action
taken with respect to people especially for employees are reducing the number of
styles in each of Nikes categories to help reduce the overtime at their factories.
Nike provides training for the workers in order to increase their job skills,
supervisory skills, factory rules and regulations and environment, health and safety.
Nike also conducts supplier code of conducts regarding to the employee wages in
which Nike requires their suppliers to pay workers at least minimum wage and
ensure the suppliers to have a healthy working conditions. Nike also takes action to
the community by increasing the cancer and obesity awareness, which called
LIVESTRONG. By participating in these initiatives, Nike makes its contribution
towards creation of an active and healthy society. These initiatives were also aimed
at training the physical education teachers to enable them offer effective physical

education lessons to the students. Nike also establishes a physical education


program for preschool children with a program called Head start. This program was
aimed at encouraging children to embrace physical activities at an early age.
So, I would like to give some recommendation in order to sustain in global
competition by adopting social responsibility. Ill use 6As model, awareness,
alignment, action, adoption, assurance and anticipation. In terms of awareness, a
company should aware what the most important factors in doing business, what
your stakeholder needs and wants, and what went wrong and right at CSR that
needs to be improved. Then, you should align and link what you aware of with what
is your company, suppliers, employees, market and global condition. Next, you
need to do some actions needed in order to sustain. Then, you should adopt and
monitor the results from your actions. In addition, you should measure and assure
the results by using key performance index whether the results are as you expect.
Lastly, you should anticipate for all those possible worst results since you need to
take another action. I think that Nike has developed this 6As model into their
successful social corporate responsibility in order to sustain and stay competitive in
the global business market. The awareness and the initiative taken by Nike has
been acknowledged and appreciated by all the stakeholders in the industry,
including customers.