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Production of Soccer Balls by Nike in Pakistan
By: SDPI

Year: 2008

Introduction:

Renowned multinational companies (MNCs) are sometimes not well versed with ground socio economic realities when operating in underdeveloped countries. SDPI carried out research study to determine whether developing societies benefit from “one size fit all” social ethics of MNC’s.

SDPI focused on Nikes production of soccer balls in Pakistan. Pakistan’s soccer ball industry is vibrant. SDPI wanted to find out how far Nike kept up with its Corporate Social Responsibility in Pakistan as manifested in its company documents. The study brought some vital facts to light. The small scale manufacturers supplying to Nike were pioneers in producing good quality soccer balls. However, these manufacturers did not meet minimum wage requirements. Gender discrimination was also prevalent. In 2006, there were allegations on Nike of child labor and unauthorized out-sourcing to home based workers. As a result, Nike withdrew its contract from its main supplier of soccer balls in Pakistan. Ironically, the victim of this act was the most vulnerable part of the society – the rural population, the informal work force, and female workers. This situation raised many questions. It reiterated the established fact that every situation is unique. Economic opportunities and ethical and social responsibilities in one society could be different from another. The affected workforce in this case was left without income generating opportunities. Economic options in an underdeveloped country are limited. This important socio economic fact was also brought to light at the European Social Investment Conference on “Closing the Information Gap” in Germany.