Today’s world can be characterized by the increasing role of globalization and complexity that make various spheres of human activity interconnected. In this context, organizations have experienced additional pressure enabled by several factors. The unparalleled degree of digitalization has facilitated the exchange of information between stakeholders across the globe. As companies benefit from the increased scope of their operations via a globalized digital environment, they also become subject to public scrutiny. Ultimately, each action taken by a firm is analyzed and discussed by stakeholders, resulting in the brand’s image changes. This paper discusses the aspect of corporate social responsibility in the context of Nike, one of the world’s leading sportswear manufacturers.
Nike is a universally known brand that is represented across most global markets. The company specializes in the production and distribution of sportswear, especially athletic footwear. According to the company’s official statement, its vision is to inspire and bring innovation to any person interested in sports. Nike’s strategy is focused on inclusive, unbiased sports available to everyone (Nike, 2021a). The social paradigm of the company relies on three Ps, which are People, Planet, Play. These principles imply that Nike exercises its practices with respect to all social groups, engages children in healthy activities, and makes meaningful efforts to protect the environment. Accordingly, the contemporary strategy of the company is executed under the direct influence of corporate social responsibility (CSR).
Avenues of Stakeholder Influence on Nike
In the case of individual stakeholders, Nike makes a significant portion of its profits selling sportswear in the retail format. Customers attend the selling locations or visit the partners’ electronic stores and execute the exchange of money for the product. In this context, the economic power of stakeholders implies a possibility of depriving the company of this income by refusing to purchase the required number of products (Li et al., 2017). At the same time, other primary stakeholders, such as suppliers and retailers, can disrupt Nike’s supply chain. As a result, the company will be unable to meet its primary objective of manufacturing the goods and selling them to the end consumers.
The aforementioned economic influence is tightly related to other factors of the corporate environment. In other words, to deprive the company of a stable income or disrupt its supply chain, stakeholders are to have serious reasons. These reasons may be purely economic and consist of the insufficient value of the product. From this perspective, Nike occupies a steady position in the rapidly growing footwear market and offers high value for its consumers (Jiang, 2019). However, the social aspect of business has acquired additional importance in the current environment. Customers, as of today’s leading primary stakeholders, have the power to damage and destroy a brand’s image through negative publicity (Feng et al., 2017). If an organization’s policies do not align with modern values, it becomes subject to serious criticism resulting in decreased purchasing intentions.
Simultaneously, the company regularly implements socially and environmentally aware policies. This way, Nike’s management mitigates the impact of stakeholder influence on the organization’s financial performance. According to Bowe (2019), modern companies actively contribute to the current political agenda by addressing topical issues. This tendency is related to another side of stakeholder influence, which is political. While the principles of a free market economy prevent authorities from direct interventions, their other responsibility is to follow the will of the people.
Therefore, the public may pressure the government into intensifying the legislative pressure on certain companies and industries. For example, Nike follows the modern trend of sustainable production, which is included in the company’s mission. If its environmental efforts become insufficient, the organization’s financial performance will be adversely affected by the green legislative framework. Ultimately, the lack of sustainability effort will translate into serious long-term repercussions enabled by the legal power of stakeholders.
Nike’s Organizational Environment
In today’s complex business environment, organizations need to acquire a complete understanding of the external factor that affects their success or lack thereof. In the case of Nike, the company appears to take into account the importance of sustainability discourse. Nike’s official website introduces an active discussion of this concept, aiming to reinforce the organization’s commitment to it (Nike, 2021b).
In the 21st century, environmental issues have become a reason for public concern, as governments and corporations are pressured into reducing their ecological impact. Further emphasis on green practices will ensure the company’s success amid the intensifying pursuit of sustainability. This discourse is to be supported with tangible actions, such as sportswear recycling, emissions reduction at production sites, and sponsorship agreements with environmental organizations. This way, Nike’s actions will remain aligned with the stakeholders’ perspective, contributing to the company’s growth.
At the same time, it is vital to remain loyal to Nike’s primary area of business. In the domain of sportswear, the company’s reputation is a valuable resource that can ensure further success. According to Nike’s Chief Executive Officer, innovation is the second pillar of its continuous growth, along with sustainability (Nike, 2021a). In this regard, the company actively implements new solutions that advance the understanding of high-tech athletic equipment. Nike’s achievements in this area are supported by a commendable range of professional sponsorship agreements (Childs & Jin, 2017).
The company’s products are worn and promoted by the world’s leading athletes, including sprinters and soccer teams with millions of supporters. This fact accounts for the brand’s reputation, making it a source of immense power. This reputable innovation and the aforementioned pursuit of sustainability for the nexus of sustainable innovation ensure Nike’s success in the 21st century.
Nike’s Social Issue Performance
As one of the world’s leading organizations, Nike may be subject to public pressure caused by the perceived lack of compliance with contemporary values. According to Bowe (2019), Nike has been allocating increasing resources to corporate social responsibility. In 2018, the company partnered with Colin Kaepernick, a Black Lives Matter activist, for an anniversary campaign. Many stakeholders saw this decision as a case of business politicization, whereas others supported Nike’s social awareness (Kim et al., 2020). Such CSR strategies risk raising serious controversy surrounding the organization. From one perspective, active participation in topical social movements may be seen as the politicization of business (Kim et al., 2020).
On the other hand, Bowe (2019) argues that, in the current interconnected environment, the public craves stronger political agency of companies. As such, an accurate choice of the side may become more effective than a neutral position. By addressing a topical matter and rising against discrimination, Nike may have caused a negative response from certain archaic groups. Nevertheless, the company’s political agency improved its image among more progressive consumers, positively affecting the brand’s image and stakeholder attractiveness.
Ultimately, Nike remains a thriving company that has retained its success in the current environment. The business potential of the organization is enabled by the sustainability and innovation nexus that allows it to remain up-to-date from both technical and moral perspectives. Nike continues to be well represented in professional sports, which speaks of the high quality of its products. At the same time, the company has chosen to voice its political stance in support of democracy and inequality. Such actions improve the brand’s image among stakeholders, translating into better financial outcomes.
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