Ethics and Nike: What do the Great Ones Say?

By: Craig Kocher

Nike Seminar -- Research Paper 4/30/98

"Ethics and Nike: What do the Great Ones Say?"

The world is, always has been, and always will be a complicated place. For most human beings, the answers to life's most difficult questions are slow to come, if they come at all. Since the beginning of time, humans have struggled with questions of the existence or non-existence of God, issues of right and wrong, and the everlasting "meaning of life." Throughout time, philosophers, scientists, theologians and others have devoted careers and lifetimes to the search for answers to these basic questions of the human condition. Nike has acknowledged that it wishes to be a leader in ethical business practices both foreign and domestic. Therefore, it is important to look at ethical principles of truth and morality and analyze their relationship and possible application to Nike and its business practices, as well as the University and its relationship with Nike.

In order to apply principles of ethics, ethics first must be defined. Ethics will be used as a general term referring to both morality and ethical theory. Morality is the effort to guide one's conduct by reason and therefore to do what there are the best reasons for doing, while giving equal weight to the interests of each individual who will be affected by one's conducts. Ethical theories are bodies of principles and rules that are more or less systematically related (Boxill, 5).

There are many ethical theories, but two major ethical systems. The first is a utilitarian approach, and the second is a deontological perspective. The major utilitarian theorists were Jeremy Bentham and John Stuart Mill. Utilitarianism's underlying thesis says that an action or practice is right (when compared to any alternative action or practice) it if leads to the greatest possible balance of good consequences or to the least possible balance of bad consequences in the world as a whole. Since it looks at the consequences, utilitarianism is a consequentialist theory (Boxill, 12).

Mill took utilitarianism a step further, establishing his theory in his book "Utilitarianism", saying, "The utilitarian doctrine is that happiness is desirable, and the only thing desirable, as an end; all other things being desirable as means to that end." This is often referred to as the "Greatest Happiness Principle" (Boxill, 12).

There are three points to summarize the broad theory of utilitarianism. First, actions are to be judged right or wrong soley by virtue of their consequences. Second, in assessing consequences, the only thing that matters is the amount of happiness or unhappiness that is caused. Finally, in calculating the happiness or unhappiness that will be caused, no one's happiness is to be counted as more important than anyone else's. Each person's welfare is equally important.

There are two general utilitarian theories, act utilitarianism and rule utilitarianism. "Act utilitarianism is the view that a right action is an action that produces at least as good results as any other that an individual may chose" (Van Wyck, 102). An act utilitarian approaches a problem by asking, "What good and evil consequences will result directly from this action in this circumstance" (Boxill, 13). To an act utilitarian, rules are simply guidelines, and can be abandoned if a particular action would lead to the greatest good. For example, if an act utilitarian is looking for a parking space in a full grocery-store parking lot and the only spaces available are handicapped, she might decide more good will come about if she quickly parks in one of the several free handicapped spots and runs into the store to get the eggs that she needs to fix dinner. Meaning, having dinner made on time for her busy family would produce more happiness then the unhappiness that would be caused in the off chance that four handicapped persons would need the three remaining spots in the ten minutes it takes her to buy the eggs.

Rule utilitarianism recognizes we all have duties we have to complete, and by completing such duties, it in fact furthers the most good for the most people (Van Wyck, 106). To use the same, woman-at-the-grocer-store example. A rule utilitarian would say the woman needs to find a legal parking space even if she is only going to be in the store for ten minutes. Rule utilitarians say everybody must follow the rules of the society, because if anyone can simply decide arbitrarily when they do and do not have to follow the rules, the community will break down, thereby bringing pain to the community. Whereas, if everyone were to follow the rules of the community it would be a far happier place in the long run.

There are, of course, criticisms to both rule and act- utilitarianism. Act utilitarians often measure their happiness- pain cost benefit in "utils" or "units." The application of units to certain situations is a matter of arbitrary opinion and would be impossible to subjectively support. The first major criticism of act utilitarianism is that only the future is taken into consideration and not the past. For example, if Jeremy promises to help Christy study for a chemistry test, but finds out that Jenny also needs help, he has a dilemma. Jeremy figures that Christy is doing fairly well in chemistry and perhaps his help would provide five units of happiness by raising her grade from a "B" to an "A" on the exam. On the other hand, Jenny is really struggling and Jeremy figures he could provide 10 units of happiness to Jenny by raising her grade from a "D" to a "B." Jeremy estimates he would do two units of harm by breaking his promise with Christy. Therefore, by helping Jenny instead of Christy, he is contributing eight units of pleasure instead of the five units Christy alone would receive. The problem is that Jeremy had made a promise to Christy and is now breaking it. "Utilitarianism seems to regard the only morally relevant relationship between human beings as that between possible benefactor and possible beneficiary" (Van Wyck, 103). Another example,

"Suppose that on election day I decide to stay home and watch TV. Since there is very little likelihood that my one vote will make any difference to the election, and therefore very little likelihood that it will produce any good in the world, and since there is every likelihood that I will get some pleasure from watching TV, it seems that I should watch TV. But if everyone acted as an act utilitarian, the result would be disastrous for the democratic system" (Van Wyck, 104).

There are also problems with rule Utilitarianism. Situations may arise prompting one to break a rule. For example, if a child swallows an overdose of aspirin, and his mother needs to rush him to the emergency room, but cannot go over the speed limit, the child might die. Rationally, most people would argue that such a situation would allow for an exception to the rule to prevent the child from dying. However, a strict rule utilitarian would say the mother does not have the right to arbitrarily decide when it is okay and not okay to break the rules of a society. Therefore, even though her child might die, less pain would come to the community over one child's death in the long run than if everyone chose when it was okay or not okay to break the rules.

The second major group of theories are those referred to as deontological theories. Such philosophies look at obligations that must be followed irrespective of consequences. Deontologists urge us to consider that actions are morally wrong not because of their consequences, but because the action involves a moral violation (Boxill, 15).

One example is the divine command theory. This theory says that "morally right" means "commanded by God." Likewise, "morally wrong" means "forbidden by God." Therefore, the will of God is the ultimate standard about right and wrong (Rachels, 31). In some ways, this simplifies the question of right and wrong. It is no longer relative to social beliefs and cultural customs, it is either right or wrong depending on God's will. The problem of course is atheists throw this theory out all together and who gets to decide what God does and does not command? If one does subscribe to the divine command theory, one must answer the question, is it right because God commands it, or God commands it and so it is right? Therefore, even though this command appears to simplify morality, in actuality, it causes further questions and problems (Rachels, 42).

The German philosopher Immanuel Kant, in his book, "Groundwork of the Metaphysics of Morals" (1785), proclaimed his ethical theory. Kant's theory is rule oriented and requires that an act is morally praiseworthy not for self-interested reasons nor as a result of natural inclinations, but only if done from duty. Kant believed that morality could be summed up in one ultimate principle, moral law, from which all our duties and obligations are derived. The person's motives for acting must be a recognition that the act is done from duty (Boxill, 15). He called this the "categorical imperative."

The first form of the categorical imperative is the universalizability principle. It requires that one act according to that maxim by which you can at the same time will that it should become a universal law. One cannot make exceptions of oneself or situations. The "golden rule" might be considered this kind or principle. The second part of his categorical imperative says that one must act to treat humanity, whether your own person or in that of another, always as an end and never as a means only (Boxill, 15). This requires that people treat each other with dignity and respect not as things or means to an end. People are rational agents, capable of making their own decisions, setting their own goals, and guiding their conduct by reason. Kant says that because the moral law is the law of reason and people are rational and reasonable, people embody the moral law.

Although Kant has been the most influential of the deontological theorists, there have been others that need to be looked at. British philosopher W.D. Ross proposed a theory to help people resolve the problem of "conflicts of duties" that arise in Kant's theory. Ross's views are based on what he calls "prima facie" duties. A prima facie duty is a duty to be acted upon unless it conflicts with an equal or stranger duty. In other words, under certain circumstances some duties have more moral weight than others (Thomas, 94).

John Rawl proposed a theory that supports Kantian ethics while conflicting with utilitarianism. Rawl objects to utilitarianism because social distributions produced by maximizing pleasure could entail violations of basic individual liberties and rights that ought to be guaranteed. According to his theory, valid principles of justice are principles we would all agree to freely and impartially. Rawl says we have to look at situations from an "original position", a position in which everyone is behind a "veil of ignorance", whereby no one knows what position one will have in society. Therefore, you would not have any idea about your race, sex, IQ, family background, station in society, talents, or anything else compared to others. Rawl says if this were the case we would all agree to two rules.

First, each person is permitted the maximum amount of equal basic liberty compatible with similar liberty for others. Rawl calls this the "liberty principle." Second, inequalities in social primary goods such as rights, income and opportunities, are allowed only if they benefit everyone, especially the least advantaged, and only if they are open to all, or everyone has fair equality of opportunity. Rawl calls this the "difference principle." The liberty principle takes priority over the difference principle, and therefore, no one can justify an inequality that may benefit society, but take away a basic liberty of another. Obviously, this is a direct challenge to utilitarianism. Rawl would disagree with Nike labor and business practices. For example, Rawl would argue that it is unethical for Nike to overwork its employees, or perhaps pay them meager wages, just so it can supply shoes to America. Overworking and underpaying employees for the benefit of American society is placing a society's wants in front of an individuals rights as Rawl defines them (Boxill, 16).

The final ethical principle that needs to be looked at because of its implications to the class, is that of "cultural relativism." The theory of cultural relativism states that different cultures have different moral codes. There is no objective standard that can be used to judge one societal code better than another. The moral code of one's own society has no special status, but is merely one code among many viable codes. There is no "universal truth", meaning there are no moral truths that hold for all people at all times. The moral code of a society determines what is right within that society. It is arrogant for people to judge the conduct of other people and people should adopt an attitude of tolerance toward the practices of other cultures (Rachels, 15).

Just like all theories, there are problems with cultural relativism. The first problem is saying there is no "universal truth." It is a paradox, because if there is absolutely no universal truth, that is a truth statement in itself. Secondly, just because people disagree about what is right and wrong, does not mean there is not a correct answer. For example:


Although there certainly are differences in values among cultures, there are "universal values" shared among cultures. For example, all cultures must care for their young. Infants are helpless and cannot survive if they are not given extensive care for a period of years. Therefore, if a group did not care for its young, the young would not survive, and the older members of the group would not be replaced. After a while the group would die out. Therefore, any cultural group that continues to exist must care for its young. Infants that are not cared for, (such a female babies killed in China) must be the exception rather than the rule (Rachels, 21).

In applying these ethical principles and theories to Nike's business practices, one must be very careful. All of these theories have both make strong arguments, but also have strong counter-arguments. It is important to understand both in order to formulate a valid argument for either side. For example, if one is going to argue in favor of cultural relativism, and therefore, Nike is doing nothing more than acting as it should be expected to act within the culture, one must also acknowledge that relativism between cultures does not always exist, and give evidence to support Nike's case that relativism does exist with Nike's business practices in southeast Asia. One who is not a cultural relativist would argue against Nike's practices in Asia by saying, it does not matter which country Nike is working in, there are some basics all people should receive by virtue of being a human being. Perhaps there should be a internationally set maximum number of hours an individual can work in a week, or there should be a global minimum hourly wage. Nike has taken the middle road when it comes to cultural relativism. Nike has acknowledge there are some labor practices that are wrong such as corporal punishment and sexual intimidation, but it also clearly believes laborers in Southeast Asia do not have to be paid as well as laborers in America. Nike is a business and therefore must maximize its profits, but it can be argued Nike has been vague as to where it draws the line betweens absolute wrongs and rights and cultural wrongs and rights. Nike has established its code of conduct to clear up some of the grey and by enforcing the code better, Nike could improve its standing among the anti- cultural relativists of the world.

If one is going to use Rawl's theory of individual liberty, one must be able to define individual rights, and place it in the context of the Nike example. The Nike contract requires all UNC athletes to wear Nike equipment. Rawl would likely disagree with the contract for the lone reason being the athletes have lost their individual right to chose. The institution maximizes pleasure for itself, but at the same time infringes on the choices of its athletes. Rawl would say the social institution does not have the right to take away a basic individual right. One could argue UNC athletes do have the right to chose, because they have the right not to play. That would be true for freshmen entering after the contract had been negotiated, but an unfair argument for an athlete already on campus who had no voice in the negotiation. The University and Nike could solve this problem by allowing athletes already participating at UNC before the contract to wear the apparel of their choice, while only making it mandatory for future athletes. By doing this, the rights of the athletes would not be taken away, and entering athletes would understand that by choosing to play at UNC, they are also choosing to wear Nike apparel.

If a person were to argue that UNC should accept Nike's money based on the Utilitarian concept of money bringing pleasure to the athletic department and student athletes by virtue of wearing Nike equipment, that person must also answer the question of whether the University should take all money as a rule, or only take money from corporate sponsors in certain situations. If the University should always take money from corporate sponsors, how would those agreements affect the academic integrity and goals of the institution? What if the history department made a deal with a publishing company requiring all the professors to have their books published by that one company, and the professors could only use that company's books in their classes? Most scholars would likely think such an agreement would infringe on their choice of textbooks and therefore damage the academic integrity of the institution. If the University should only take corporate money from some corporations such as Nike, how does it decide when it is okay to take the money and when it is not okay? If McDonald's offers the athletic department 15 million dollars to rename Kenan stadium, should the athletic department accept the offer because of the pleasure 15 million dollars would bring to UNC? The athletic department would likely say it would not sign such a deal because it would be blemishing the name of Carolina athletics. In order to solve these problems, the University should come up with a tangible way to decide when it is okay and is not okay to accept corporate sponsorships. By doing this, when the University does agree to corporate deals, it can not only have a better ground to negotiate on, but offer the public much better and more understandable reasons for accepting or denying corporate contracts.

If Kant is right and an act is morally praiseworthy not for self-interested reasons, but only if done from duty, is Nike looking after itself or others in its business practices? Kant would argue that Nike has a moral duty to insure the health and financial well-being of all the people who work for it. Therefore, Nike must do all within its power to ensure the information it is receiving from factories overseas is correct. Nike has said many times it wants to be a "good citizen" and a leader in ethical business practices. It is very likely Nike is doing a much better job with foreign labor relations than many other corporations are, however, according to Kant, Nike should not be comparing itself to other companies, rather it should be holding itself to the absolute highest ethical standards it can attain. Nike has made an effort to increase its independent monitoring system overseas, but it cannot stop improving. Nike must strive to find a system that continues to improve until it can alleviate as many unethical labor practices as possible.

According to Kant, the University also has a moral responsibility to itself and Nike. The University is morally obligated to use its position of power to encourage Nike to work harder to improve its business practices. The University also has a moral obligation to back out of a contract with any corporation that lacks ethical business integrity.

These are all big and difficult questions, but if there is dispute, and there is, over if Nike and the University are right or wrong, there must be a rational and tangible way to define right and wrong in order to support an argument for either side. It is therefore important to understand what some philosophical theories say about defining what is, and is not, morally acceptable. By understanding these theories, and applying them, with or without success, one can in some ways, simplify the complexity of the Nike case.


Boxill, Jan. "Coursepack: Phil 034, Bioethics," The University of North Carolina. (1993).

Rachels, James. "The Elements of Moral Philosophy," Random House,Inc. (New York, New York, 1986).

Thomas, Geoffry. "An Introduction to Ethics," Five central Problems of Moral Judgement, Hackett Publishing Company (Indianapolis, Indiana, 1993).

Van Wyck, Robert. "Introduction to Ethics," St. Martin's Press, Inc. (New York, New York, 1990).

Copyright, 1998
Craig Kocher, INTS 092
UNC - Chapel Hill