Nike Corporation: Jumping the Hurdles of Social Responsibility Disclosure

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Nike Corporation: Jumping the Hurdles of Social Responsibility Disclosure Teaching Note The Nike case is intended to promote classroom discussion and instruction regarding the obstacles to effective public relations practices and the necessary steps to overcome those obstacles, not to commend or condemn Nike’s course of action. Apart from the many strategic questions the case raises regarding Nike’s approach to a threatening business problem, the case offers two important questions relating to contemporary business issues: first, was Nike ethical in the way it communicated its practices, and second, in what manner should companies best disclose social responsibility information to the public? The following teaching note provides the background information, viewpoints, and research necessary to facilitate classroom discussion and debate regarding possible answers to these two questions. The teaching note first discusses the ethical implications of Nike’s public relations strategy. The ethics section is followed by an analysis of the emerging field of corporate social responsibility (CSR) accounting and auditing, an area that might provide answers for companies with challenges similar to those Nike encountered. ETHICAL CONSIDERATIONS When Nike began using traditional advertising methods to broadcast its production practices in response to activist criticism, it began to tread an ethically challenging path. Traditional advertising ethics are insufficient when applied to corporate social responsibility disclosure because the role of “company” intertwines with the role of “citizen,” which is held to a higher ethical standard. Corporate citizens are companies acting in behalf of a social interest, which may or may not affect revenues. These socially beneficial actions raise the ethical standard for such companies because of purportedly

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