Students from the University of Arizona share their argument concerning the Nike Corporation’s problems of capitalism and human rights. In today’s world, many of the business leaders who were once revered as heroes of the free market are now being accused of exploitation. The young people who will someday lead this country are taking notice, grappling with the issues of human rights and business practice, and asking some important questions. How can we strive to be successful leaders of integrity while competing in a dog-eat-dog industry?
Lane Taylor, Cari Natvig, Lauren Button, John Netherton
Monday, May 2, 2011
TUCSON, AZ – The United States has provided a strong environment that cultivates business growth and free commerce. This environment has been successfully created based on the capitalistic principles that this nation was founded on. These principles mean that people have the opportunity to improve one’s standard of living and the freedom to be able to individually decide how to invest goods and wealth. These ideas are the driving force behind a free market system, and with this force comes a great amount of individual responsibility. Essentially, as a business leader, one must be aware of the point at which capitalistic opportunity infringes upon basic human rights of others. The problem that arises in this system is when the individual (a business leader) extends the definition of capitalism in a way that violates basic human rights. Just as our country was founded on the ideas of capitalism, this country was also founded on the idea that everyone is entitled to life, liberty, and the pursuit of happiness.
One of the most well known companies that has been accused for violating human rights at the expense of capitalism is The Nike Corporation. In the sports world, “Nike currently enjoys a 47% market share of the domestic footwear industry, with yearly sales of $3.77 billion” (Van Dusen). Nike has achieved this success by outsourcing and sweatshop labor practices. While it is true that Nike’s decision to outsource has provided many jobs to impoverished nations, the positive effect on these nations’ standard of living is so slight that it is almost negligible. Basically, these people have gone from being unemployed to making, according to Jim Keady, a mere $1.25 a day. According to Jim Keady experience in Indonesia, this is enough money to barely survive. He says that this wage will buy (after water, electricity, and transportation costs) an individual a weekly supplement of “two simple meals of rice and vegetables, a bag of peanuts, a bottle of iced tea, and some dish detergent”. Based on the United States’ federal minimum wage and Jim Keady’s assessment of wages of sweatshops employees in Indonesia, Nike has decreased their labor costs by 82 percent. Given this data, it is clear that Nike has invested capitalistic opportunities in direct violation of human rights. Nike has simply sacrificed their integrity for a profit, and in doing so, they have paved the way for other companies to do the same in order to compete or succumb greed.
How does one compete in a dog-eat-dog industry while still maintaining integrity? The answer lies in the examples set by two of Nike’s competitors: New Balance and Converse. New Balance has yearly sales of $260 million, and Converse sustains yearly sales of $280 million. These companies have achieved their success while maintaining fair wages and good working conditions for their employees. These companies have proven that integrity does not need to be sacrificed to achieve success. The difference between Nike’s $3.77 billion profit and Converse and New Balance’s $280 million and $260 million profits is the fact that the business leaders of the latter companies have kept a view of the balance between capitalism and human rights. They have not succumbed to the temptation of greed.
As current and future business leaders we must keep our eye on the balance between capitalism and human rights. We cannot deny that positions of privilege also follow with responsibility. The fact of the matter is that one can be successful without sacrificing integrity. New Balance and Converse have proven this. In the end business leaders must be willing to say when enough is enough. The moment success switches from prosperity for all to greed, is the moment we start to abuse capitalism. So we must decide. Can we be content with running a $260 million business or do we need the $3.77 billion business? Can we accept driving a BMW instead of a Ferrari if it means providing quality wages and working conditions for our workers? Business leaders are constantly striving to push the limits and attain something more. This is the very nature through which most have achieved success. However, the motivation to achieve something more cannot be allowed to lead us down a path of exploiting others. If you currently are, or if one day, you find yourself as the head of a successful business, can you accept a limited amount of success to keep your integrity? Will you strive to be a successful business leader of integrity?