Nike had been silent for several years and this was due to legal concerns until 2005 when the company resumed to reporting on its social and environmental practices. The company is important in that it is the largest private sector employer that offers jobs to more than 50,000 employees in Vietnam. Some of the widespread problems in the Asian factories Nike being used as an example include the abusive treatment of workers, restricted access to public utilities such as toilets and drinking water during working hours, overworking the employees, low wages which are far below the legal minimum and the punishment of workers who refuse to work overtime hours.
Nike decided to be transparent on its operations and the NGO working on the issues facing the company pointed out that the company invested more in improving the working conditions of its workers as compared to many of its competitors in the industry. Other companies have also been urged to adopt new approaches to labor standard improvements that involve NGOs, governments as well as local businesses. Following this, in May 2005 Hannah Jones who is Nike’s vice president of corporate responsibility added that the company had been looking into how to solve problems for themselves and they are working towards the accountability for all. The corporate citizenship goal of the company is to try its best to influence other companies in the footwear industry to raise the bar and attain better standards of social and environmental performance.
The company’s management has developed a new strategy and is no longer viewing the company as a closed system. Nike’s management has come to realize that the future and the success of the company depend on the way that customers, investors, suppliers and regulators relate to it. The main challenge is to balance between financial viability, competition from its competitors as it takes into consideration the interests of the other parties involved. The experience Nike has had is important even to other companies which are ignorant in addressing the problems associated with the industry. A very good example is the Unilever which was criticized for profiting from the worsening of the workers conditions. Some of the workers were laid off while some wages went unpaid.
Implementation of the strategy relies on the leadership and management of these companies. An article on leadership in Conference Board Canada’s Organizational Performance Review pointed out that the world needs leaders beyond borders. This means that to bring about changes and success in these companies people need to see beyond the borders which are created by others. For instance in the labour market the employees need to see across the borders created by their jobs and they should be able to engage in dialogue to address the problems they are facing in their daily routines. This kind of leadership is known as transcending leadership since it transcends the boundaries of one’s professional role and on the other hand limits the engagement of individuals on collective goals. This form of leadership is where the leader acts as the ear to his/her juniors and look into the matters affecting them accordingly to ensure their success and the success of the company.
In conclusion, any company willing to expand its boundaries and improve its trade flows, management and governance must aim at becoming sustainable and just. The company must work on ensuring that it remains profitable and on the other hand it must ensure that it treats all the parties involved in its operations in a ju