Nike, one of the world's most valuable brands, enjoys a stellar reputation for its products and image, but its reputation as a company has been tainted by widespread sexual harassment allegations within the company. This activity is important because understanding a major sexual harassment problem at a large company requires considering the many factors that may have caused it to develop over a long period of time.

The goal of this activity is for you to trace various issues that may have led to the prevalence of sexual harassment and discrimination at Nike, as well as to evaluate possible remedies.

Read about sexual harassment at Nike. Then, using the three-step problem-solving approach, answer the questions that follow.

Business events that move to strip clubs, emails in your own inbox about parts of your body, lewd and vulgar comments, and more commonly but similarly troublingunfair pay and promotion practices; these are a subset of complaints revealed in a survey conducted by female employees at Nike. The findings Illustrated systematic sexual harassment and discrimination.

Supporting these claims are a long history of complaints to HR and leaders within the company about inappropriate behavior by a number of male leaders. Women comprise nearly 50 percent of the company's workforce but occupy only 38 percent of management level and 29 percent of vice president positions.¹

Female employees shared these results with CEO Mark Parker in an effort not only to improve the situation for women at Nike, but also to improve Nike. Their efforts provide yet another example of how employees are organizing and wielding power and Influence to change leadership, culture, and practices at their employers.²

How Did This Happen?

The allegations and evidence are wide-ranging, but many attribute misconduct not only to the perpetrators but also to their superiors who have tolerated or looked the other way. For instance, numerous implicated executives are linked to former company president Trevor Edwards. His charismatic personality and stellar performance had taken him to the heights of the organization, and many believed he was next in line for the CEO job. But many senior leaders who ascended the ranks were largely male and considered a part of an elite groupF.O.T., or Friends of Trevor.³

Although Nike claims the behaviors were the actions of an insulated few and has since fired at least 11 executives as a result, the fact remains that many individuals in power destroyed relationships and undermined the careers of others. Complicit were HR policies, practice, and people who failed to sufficiently act on and provide consequences for inappropriate behavior. These detrimental actions eroded performance, trust, and a sense of justice, along with fostering conflict and a culture many describe as discriminatory and abusive to women.

The Costs.

In addition to damaging the careers of the terminated executives, widespread misconduct exposes the company to tremendous legal liability, reputational damage, investor pressure, and the alienation of women both inside and outside the company. Expanding product offerings for female customers is a major component of the company's strategy. Particularly troublesome for the remaining leaders is the likelihood of a class action lawsuit, in which more than 500 employees will seek compensation from Nike for sexual harassment, pay discrimination, and unfair promotion practices.⁴

Reactions

CEO Parker and the remaining senior leadership team have responded in several ways. Parker directly and publicly acknowledged the problems and apologized to employees in a town hall meeting, established a complaint hotline, set up unconscious bias training, required specific training for managers, appointed Nike's first chief diversity and inclusion officer, revamped its pay structure and provided raises for approximately 7500 employees, or 10 percent of its global workforce. Nike also has adopted a gender-blind resume review process and is tying bonuses more prominently to overall company performance.⁵

Part of Parker's apology Included, "I apologize to the people on her team who were excluded, and I apologize if some of those same people felt they had no one to turn to. ... I want everyone at Nike to know their voices do matter and your bravery is making us better." ⁶ But even after all of the company's corrective actions, Parker and others feel the work Is far from finished.

Assume you are CEO Parker and you want to: (1) make amends with the important stakeholders involved, and (2) put Nike on a positive track for the future. Drawing on what you learned in this chapter what else would you do?

Which of the following quotes from the case best summarizes the main problem it describes at Nike?

Multiple Choice

• "The findings illustrated systematic sexual harassment and discrimination."
• "Expanding product offerings for female customers is a major component of the company's strategy."
• "Particularly troublesome for the remaining leaders is the likelihood of a class action lawsuit"
• "Nike also has adopted a gender-blind resume review process and is tying bonuses more prominently to overall company performance."
• "For instance, numerous implicated executives are linked to former company president Trevor Edwards."