International Trade Paper

Question

Type: Research Project/Essay

Weight:  1500 words 40%

Task Description:

The goal of this major essay is to promote the development of critical

reflective skills in order to analyze specific global-related issues,

considering diverse perspectives and heterogeneous stakeholders in

cross-national contexts are shaped by global forces.

The unit of analysis of the major research essay combines the main topics

covered during the course with specific issues developed in particular

industries, companies and/or organizations in which global forces have

created controversies, contradictions or competing views.

In order to facilitate the selection of themes, the student must combine any

three themes; two from column one and one from column two (see Table

below). Please use topics that are highlighted in yellow.

Column 1               Column 2

TNCs &Globalisation            Agro-food industry and Fair Trade

Role of State in a Global world             Steel World wars

Global variations in State Economic policies       Bio-fuels

Civil Society, local communities &globalisation  Exploration of natural

resources

CSR &Globalisation              Low-cost manufacturing & services

Ethics in the Global arena      Global financial crisis

Global society & the Environment        Global pharmaceutical industry

A minimum of 5 academic journal articles is required in this item. Web

information and the textbooks can be used but are not considered to be

academic journal articles. Textbook use must be kept to a minimum.

In your analysis you must consider at least two of the three following

questions:

a. How have particular globalization forces affected/influenced the issue

you are studying.

b. What are the ethical and/or CSR implications of the issue you are

studying?

c. What effects if any has globalization had upon HRM?

Criteria & Marking:

Marking criteria:

(1) Theoretical and conceptual understanding. Appropriate choice & use of

concepts& theories to analyze the supply chain you have selected.

(2) Research depth and quality. Use of supporting information and academic

sources; range and quality of empirical information presented; relevant

practical examples described and linked to relevant theories.

(3) Application of concepts and theories. The theory is applied appropriately

to provide an appropriate analysis of the production chain. The essay uses

theory and practical examples to answer the research essay questions.

(4) Structure and Style. Logical argument and essay structure with the clearly

defined issue and links to relevant empirical evidence; appropriate

premises identified; comparison and weighing of information with valid

conclusions drawn; the clear flow of ideas (eg. start to finish, paragraphs

flow clearly to the following paragraph).

(5) Presentation. Writing style facilitates the reader’s understanding;

concise; not repetitive; appropriate format; word limit; on time; typing;

spelling; grammar; referencing style.

Note:

1.            Use Theories which are relevant to NIKE e.g. Culturalrelevatism,

Hoftede’s,  utilitarian, Kantian and should relate to the

case.

2.            The main focus needs to be on Globalization, 3rd party accountability,

protest campaign, social responsibility, CSR and product chain, Ethics and

conduct, labor working condition.

3.            Some issues:- Low Wages in Indonesia, Child Labor in Pakistan, Health

and Safety Problems in Vietnam.

4.            Please use at least 5journals which are directly related to the NIKE

case.

5.            Harvard style referencing.  University does not accept plagarism0%.

Title: Globalization and corporate social responsibility

Student’s Name:

Name of Course:

Institutional Affiliation:

Date Submitted:

Contents

Introduction. 3

CSR & Globalization forces at Nike. 4

Ethics in the Global arena. 5

Third-party accountability and corrective measures in the era of globalization. 7

References. 8

Introduction

Many definitions of the word ‘globalization’ exist today. However, broadly speaking, globalization may be defined as the organization of social life on an international scale, the expansion of global linkages, and the continuous growth of global consciousness, leading to the consolidation of world society.

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The corporate social responsibility issues that emerge in today’s organizational settings are increasingly being influenced by globalization.  Corporations and their respective PR entities view globalization mainly in terms of the various economic opportunities that emerge with the opening of local markets to the international investment and trade scene.

However, some anti-globalization movements have arisen in response to the emerging corporate globalization (Carty 2002, p. 13). The irony of it all is that these protest forces are themselves global in scope. For instance, during the ‘Battle of Seattle’ of 1999, activists from across the world shared information through the internet, whereby labor, environmental and social activists challenged the actions of the World Trade Organization.

This paper explores the CSR and globalization issues experienced at Nike. Focus is on controversies, contradictions and competing views concerning this topic with reference being made on relevant theories. The paper explains how the globalization force of adopting low-cost manufacturing and services has influenced the CSR efforts that Nike uses today. It also assesses the ethical and CSR implications of Nike’s operations on the global corporate scene.

CSR & Globalization forces at Nike

Nike is a global, American-based sports footwear and uniform company. The company uses the logo ‘Just Do It’ in all its marketing and publicity activities. The company is arguably the world’s leading maker of athletic footwear. Nike designs and sells footwear as well as uniforms for many different sports.

In its global-oriented marketing and corporate social responsibility, the company has been seen to be engaging more in activities of domination than in offering assistance. Its operations are done through NIKETOWN sportswear and shoe stores, NIKE Women shops, NIKE factory outlets, and online stores. Overall, this company sells in products in 690 NIKE-owned retail stores all over the world. Moreover, the company operates about 23,000 retail accounts within the US alone as well as via licensees and independent distributors in other countries.

Over the last few decades, NIKE has managed to grow at an impressive rate. One of the factors that have contributed greatly to this growth is globalization (DeTienne, K, 2007, p. 370). Through globalization, NIKE has been able to take advantage of many global sourcing opportunities in order to produce low-cost products and then investing the savings into innovative campaigns as well as marketing campaigns. However, the same factors, globalization is one of them, have created serious problems for NIKE in recent years.

During the 1980s, NIKE was facing criticism for sourcing its products from factories where poor working conditions, low wages, and human rights abuses were rampant. However, it is during the 1990s, that the worst series of public relations nightmares rocked NIKE. Cases of child labor in Pakistan and Cambodia, underpaid workers in Indonesia, and poor working conditions in Vietnam and China, all combined to tarnish the image that NIKE had been building for decades (Donaghu 1990, p. 546). Within no time, the company that was popularly associated with health and fitness, athleticism, innovative design, and marketing was becoming a symbol of the anti-globalization movement.

Many modern multinational companies argue against claims of any wrongdoing in engaging in unethical activities by referring to the notion of cultural relativism. From this perspective, human differences in terms of what they consider ethical are wholly cultural. The problem is that cultural relativism has already acquired a negative reputation in many quarters, including in the world of anti-globalization activism.

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NIKE’s problems provided a classic example of the problems that globalization has the potential to create for multinational organizations. NIKE’s problems were fuelled by the company’s efforts to exploit to the fullest the Low-cost manufacturing & services opportunities that were being made available through globalization.

Ethics in the Global arena

When NIKE started using traditional methods of advertising to respond to activist criticism and to broadcast its production practices, it had embarked on an ethically challenging path. The main problem was that the traditional advertising methods of addressing ethical issues were insufficient to respond to sentiments from activists who had formed a global network.

In issues of corporate social responsibility disclosure, the role of a ‘company’ tends to be intertwined with that of the ‘citizen’, which is always held to a much higher standard. In the increasingly globalized world, NIKE found it increasingly difficult to reconcile the role of a corporate citizens with that of the solely profit-making intention of the corporation. The purportedly altruistic intentions of the company were difficult to portray to the world, and they were, and continue to be, more demanding than in the case of those companies that operate without social interest.

In the face of opposition from activists, NIKE has had to face the unpleasant situation of responding to criticism or reporting less attractive details. The greatest challenge has been the ability to engage in public dialogue in an ethical and legal manner while disclosing in a positive manner all the information that sheds light on all issues under contention, some of which involve third party accountability (Locke 2003, p. 220).

From the point of view of Hofstede’s cultural dimensions, NIKE’s problems appear to be the result of a lack of proper understanding among different cultures. Whenever a company surpasses the national borders and engages in the global business arena, many cultural differences arise. An activity that is considered an unfair labor practice in the US may be viewed in a completely different light in Pakistan and Cambodia.

For NIKE’s employees who have worked with the company both at home and away, it is amazing how differently people of other cultures behave. The five Hofstede’s cultural dimensions (power distance index, individualism, uncertainty avoidance index, masculinity, and long-term orientation) are all relevant in the analysis of the CSR responsibility concerns that activists point out. Similarly, NIKE can refer to these dimensions in order to understand cultural incongruities in the global market better.

Third-party accountability and corrective measures in the era of globalization

Nike continuously monitors conditions in all factories that it is engaged in contracts in order to determine areas where risks are highest. The aim is always to ensure that timely corrective actions are undertaken to correct these shortcomings (Carty 1997, p. 196). The main issues that have been observed in the contracted factories include lack of knowledge, lack of an internal and external and internal communication system and lack of commitment.

The problem of excessive overtime in companies that supply NIKE with production materials also irritates anti-globalization activists. Factory contribution and transparency are the two main issues that the factories highlight as the corrective measures of ensuring that excessive overtime polices are not repressive. Moreover, all contracted suppliers are always required to adhere to NIKE’s code of conduct. This code spells out standards for all contracted manufacturers with regard to every employee’s working hours.

Specifically, all contractors are required to comply with the legally mandated work hours in their countries of operation. They may use overtime as long as each employee is compensated fully in accordance with the local law. Moreover, each employee has to be informed on whether overtime is a mandatory requirement upon taking up the employment opportunity. Such provisions of the code of conduct imply the convergence between utilitarianism, cultural relativism and capabilities approach in specifying NIKE’s CSR strategy.

From an anthropological perspective, the concepts underpinned in the theories are a demonstration of the relational conception of individual rights and freedoms as they relate to the CSR criteria. Such criteria can be understood by the company’s stakeholders rather easily, thereby avoiding internal conflicts. Such conflicts can harm a company’s pace of development and growth in today’s era of globalization.

In specific terms, the cultural relativism approach is relevant in NIKE’s CSR strategy, particularly the issue of doing business with people of different cultures. The appreciation of other people’s cultural values, as well as universal human rights provisions, is an integral part of being an ethical businessperson. It is also a core component of corporate citizenship among all multinationals that have put this public relations measure in place.

References

Carty, V, 2002, ‘Technology and Counter-hegemonic Movements: The case of Nike Corporation’, Social Movement Studies, Vol. 1, No. 2, 12-17.

Carty, V, 1997, ‘Ideologies and Forms of Domination in the Organization of the Global Production and Consumption of Goods in the Emerging Postmodern Era: A Case Study of Nike Corporation and the Implications for Gender’ Gender, Work & Organization, Vol. 4, No. 4, pp. 189–201.

DeTienne, K, 2007,‘The Pragmatic and Ethical Barriers to Corporate Social Responsibility Disclosure: The Nike Case’ Journal Of Business Ethics, Vol. 60, No. 4, pp. 359-376.

Donaghu, M, 1990, ‘Nike just did it: International Subcontracting and Flexibility in Athletic Footwear Production’ Regional Studies, Vol. 24, No. 6, pp. 537 – 552.

Locke, R, 2003, ‘The Promise and Perils of Globalization: The Case of Nike’ Journal of Management, Vol. 3, No. 3, pp. 201-229.

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