Given a brief background of what a sweatshop is and the Russell Athletic scandal. In my opinion, sweatshops do not provide a healthy environment for workers. Most importantly, sweatshops exploit workers by paying them unscrupulous wages. Over the past years, there have been plenty of accidents involving sweatshops. Take Bangladesh, which is the top five exporters of apparel to the United States and Europe (Patwary, 2018). “On April 24, 2013, more than 1,000 workers were killed when an eight-story building collapsed while thousands of people were working inside” (Luthans and Doh, 2018, p. 111). Several accidents later, some firms finally agreed to improve their buildings infrastructure and safety regulations. When it should be a company’s priority to make sure that workers are working in a safe environment and not in deplorable conditions.
The first thing I would undertake as an executive of a large U.S. multinational corporation planning to open a new manufacturing plant in China and India to save on labor costs is to perform in an ethical and socially responsible manner. The last thing companies need is people questioning their business practices or be involved in an ethical dilemma. Upon entering a foreign country, one must also consider the legal, political, and economic factors. Labor laws and regulations should never be ignored, especially in developing countries where there isn’t much enforcement. These things are very helpful in avoiding sweatshop scandals. Although I am not for sweatshops, it will be difficult to eliminate each sweatshop operation. The reason I say this is because people are desperate to work in order to support their families and they see no better alternative.
Operations here in the United States and other countries shouldn’t be any different. Companies should learn to maintain the same labor standards and regulations that they have in the home country when they conduct business in developing countries. Unfortunately, it will be hard to do so because developing countries do not have such national standards. Individuals in developing countries should be educated about their rights; they shouldn’t accept their situation, given that they aren’t well-informed and being treated unfair.
After the Russell Athletic scandal, corporations should take into consideration that it is no longer easy to avoid social responsibility for its outsourcing activities (Luthans and Doh, 2018, p. 109). Taking advantage of cross-country differentials in ethical practices should be avoided. With an increase of global awareness of ethical concerns, it should make sense for corporates to be more aware and proactive in their socially responsible initiatives. If not, the public and nongovernmental organizations (NGOs) will not stop fighting against businesses with inequitable practices. Take, for instance, the United Students Against Sweatshops (USAS) who took initiative against Russell Athletic because they considered sweatshops permissible.
I think it is great that organizations like the USAS care about labor practices in other countries. Especially if the government of each particular country isn’t really taking initiative about the labor practices. But because most governments are failing to impose that companies operate in an ethical and socially responsible way that organizations like USAS surface. I believe NGOs can be very successful at getting companies to be ethical and socially responsible in other countries. It is safe to say that NGOs are likely to be more effective than governments because they often become corrupt. Meaning that governments are not really fulfilling the responsibilities of their roles based on moral obligations.
In the case of Russell Athletic, they had no choice but to surrender. The USAS was very forceful in that Russell Athletic rehire 1,200 workers. Russell Athletic made the right decision by granting the USAS demands only after they threated the company’s profits. Most of their profits came from supplying to high schools and universities, so when Russell Athletic heard that the organization would get schools and universities to suspend their contracts with the company, it was the tipping point for them. It took almost two years of student campaigning and Russell Athletic could have negotiated an agreement beforehand to avoid the bad publicity. But this goes to show that students or people, in general, can make a difference if they stand up for what they believe in. The USAS has given others hope in that other organizations can make a difference, and in the long run, this could aid in the ability of companies to make their own strategic decisions.
In conclusion, I believe that sweatshops should be directed towards improving working conditions through legal matters and protection. Workers in developing countries should be given more attention, better pay, and a better working environment. Non-governmental organizations should continue to participate in campaigns against corporations who perform unethically, because they have proved to be more successful than governments, most importantly in the case of Russell Athletic. However, after many corporate dilemmas, one would think to perform better to avoid any negative publicity. Therefore, corporations need to act in an ethical and socially responsible manner wherever they operate and should be more careful with any business decision they make. We cannot get rid of sweatshops yet, because they have become necessary to the world’s economic development. But what we can do, just like the USAS did, is recognize the sweatshop workers who are imprisoned in a terrible cycle of poverty and can barely afford daily expenses.
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