1. What could Nike have done to prevent this bash of negative publicity on the forefront?
2. Was there an agency problem at Nike?
3. What governance mechanisms can you recommend for Nike?
4. What examples of unethical behavior can you identify that occurred within Nike?
5. What steps can Nike take to ensure that ethical considerations take place within the organization?
Nike, one of the leading marketers of athletic shoes and apparel, has $10 billion in annual revenues and sells its products in some 140 countries. Nike's approach to focus on designs and marketing and outsource its manufacturing around the globe has led to more than a decade of repeated and persistent accusations that its products are made in "sweatshops" reflecting the company as evil by exploiting the world's poor. Receiving criticisms from several nongovernmental organizations through renowned media reports, Nike has taken many steps to counter the protests such as assessing working conditions and performing factory inspections and audits of its subcontractors but many skeptics consider it all a smokescreen. With the United Students Against Sweatshops (USAS), playing a growing force behind new protests and creating their own independent auditing organization, Nike continues to push forward with its own initiatives and announced that it would release complete reports of all independent audits of its subcontractor's plants.