1. Business Ethics Ethics and Supply Chain Management Prepared by: Daniel Jolly Iris Hu Rini Ernawati Virginia Lam

2. Responsibility of the dominate firm in a supply chain Should they be responsible for the ethical conduct of its suppliers? YES!! Being “big means “extra responsibility” Backward Integration Marketing Tool Competition

3. General Motor’s Policy on gift, entertainment & gratuity Covered by Policy! No GM employee can accept gift, entertainment or other gratuity from any supplier or bidder It applies to all employees regardless if they are involved in purchasing activities. Is this policy sufficient to ensure ethical conduct when managing with suppliers? Role Play 1

4. General Motor’s Policy on gift, entertainment & gratuity Is this policy sufficient to ensure ethical conduct when managing with suppliers? Role Play 2 Covered by Policy! Gray areas include inexpensive mementoes (logo pens, cups, caps or items with nominal value) maybe accepted. Questionable situation should be discussed with supervisors If there is a reason to accept gifts of real value, they should be reported to management and returned to GM.

5. General Motor’s Policy on gift, entertainment & gratuity Is this policy sufficient to ensure ethical conduct when managing with suppliers? Role Play 3 Many gray areas not covered by Policy! Personal relationship????? I’m sure you can think of many of ideas…

6. Nike’s Policy What is Nike Doing Right ???? Environmental Policies ! Establishment of NEAT and MESH to answer the problems the sports industry poses to the environment. Consistent environmental responsibility across global market Other companies have followed Nike’s lead.

7. Nike’s Policy What is Nike Doing Wrong? Sweatshop Labour ! Criticized for contracting with factories that use sweatshop labour in countries such as China, Vietnam, Indonesia and Mexico. As late as 1996 Nike has violated minimum wage and overtime laws in Vietnam. Criticised for use of child labour in Cambodia and Pakistan. Accused of poor working conditions, exploitation of cheap overseas labour and forced labour camp like work conditions.

8. Nike’s Policy “A RIGHT DOES NOT MAKE A WRONG RIGHT” Environment, employees, contractors, suppliers are stakeholders Nike has an ethical and moral responsibility to all stakeholders Doing right for one side does not allow Nike the right to do wrong to another side (not a mutually exclusive tradeoff). Nike ethical reputation is built on the consistency of its policies (not just the environment at the detriment of labor policies) Why no greater leeway in Labor Policies????

9. Q&A