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Advertising or Free Speech? The Case of Nike and Human Rights

This weeks discussion is about Corporate Social Responsibility (CSR), focusing on the brief case study about Nike (p.101 in the textbook).

Nike pioneered offshore manufacturing by hiring third-party contractors in developing nations to work in its company-owned plants. Among other workers, the contractors hired minors at low pay in sweatshops. When the news became public in 1996, Nike faced negative public opinion, and then it established a Corporate Responsibility and Sustainability Committee to ensure that labor practices were ethical across its supply chain.

After that, Nike was sued for allegedly knowingly making false and misleading statements in denying its direct participation in the abusive labor conditions abroad in manufacturing its products. The case was dismissed for procedural issues by the U.S. Supreme Court. Thereafter, Nike has worked on building its CSR profile through relief efforts and advocating fair wages and employment practices in its outsourced operations.

Thinking about Nikes corporate practices, if you were to start a company that outsourced labor in order to reduce manufacturing costs, what decisions would you make to combine commercial objectives with social goals to improve the impact of corporate social responsibility efforts? How might the two conflict?