Adidas


Introduction

Whether you like sports or not, you cannot deny the fact that they play a huge role in society today. At a basic level sports can help children to become more social and build teamwork skills, but on a much broader scale they are far more important than that. Sports generate billions of dollars, provide millions of jobs and can bring people and communities together even at the worst of times. For a short period of time, they give people the opportunity to forget about the world around them. However, sometimes people get too caught up in sports that they become blind to what is actually going on. For example, people look past companies who exploit workers; as long as they are able to purchase their favorite players jersey at a reasonable price. Consumers do not question how or who made it possible for them to wear the newest pair of basketball shoes and this sad truth is something that must change. In this paper I am talk about Adidas and some of their controversial means of production and what has resulted because of this.

Company Background

Founded in 1924 by Adolf Dassler (then known as Gebruder Dassler Schuhfabrik), Adidas has become a well-known multinational corporation. The company is headquartered in Germany, but provides products to men and women all around the world. It is the largest sportswear manufacturer in Europe and one of the biggest in the United States as well. Adidas is mainly known for selling sports footwear; however, it also sells shirts, bags and other sport-related clothing. In its early years Adidas was rather successful, but it was at the 1936 Olympics when business began to boom. Dassler drove to the Olympics and convinced Jesse Owens to wear a pair of his shoes, which marked the first sponsorship for an African American. By doing this, many other athletes became interested in Adidas and began to purchase shoes from the company. As a result, sales increased drastically and business was going as well as ever. Then, after a feud with his brother, Rudolph Dassler, the company split and competition started to increase. After leaving Adidas, Rudolph founded Puma, which also sells footwear and other sport-related clothing. The two competed for sales and attempted to be the best at what they were doing. Adolph and Rudolph competed back and forth for many years and despite trying to steal customers away from each other were both successful. After family troubles for Adolph and various different ownerships over the late 1900s, Adidas’ CEO is now Herbert Hainer. Upon taking over in 2001, Adidas has been prosperous; however, things have not always been smooth. Hainer has been in the midst of criticism regarding some of its apparel, its contracts and its production methods.

Criticisms of Adidas

Adidas’ management was trying to figure out the most efficient and profitable way to supply their consumers with their products. They wanted to market their brand and become a powerful company in the sportswear industry. So, Adidas decided to outsource. They felt that if they were able to do this effectively they would have the ability to produce large quantities of apparel and supply it to their consumers at a reasonable price. What Adidas did not factor in was that they would be exploiting thousands of workers in the process. Production was outsourced to Indonesia, where the laborers are paid low wages, work in horrible conditions and as a result cannot provide for themselves or their families. For a time Adidas was able to do this without being condemned for it, but they quickly came under fire. War on Want, an anti-poverty charity that campaigns for the needs of impoverished people, took stand against Adidas during the 2012 Olympics. “Campaigners attached 34p tags to Adidas products at stores around Britain—the minimal hourly wage rate for Indonesian workers making the brand’s goods” (Collins). A War on Want campaigner Murray Worthy says, “Adidas is clearly now on the rack through growing pressure over sweatshops. Thousands of our tags are being put on its products across the country. It is high time Adidas recognized exploitation is not OK and ensured a living wage for its factory worker” (Collins). You would think consumers would stop supporting Adidas’ brand, but unfortunately, not many people seem to care. War on Want estimated that four billion people would be watching the Olympics games, while Adidas would also rake in 100 million euros worth of sales as a result of the games. It is shocking that so many people know about what Adidas is doing, yet they will still sit down, turn on the game and cheer for their country while they are wearing uniforms that represent exploitation.

badidas

Another issue Adidas has encountered in 2012 was the formation of the “Shackle Shoe”. This product was approved by Adidas Research and Development and was set to be sold in stores, but faced large amounts of criticism right before. The shoes were seen by Reverend Jesse Jackson and he responded by saying, “The attempt to commercialize and make popular more than 200 years of human degradation, where blacks were considered three-fifths human by our Constitution is offensive, appalling and insensitive” (Solomon). More opinions on the shackle shoe were heard when Ms. Rodwell spoke out saying, “Wow obviously there was no one of color in the room when the marketing/product team ok’d this” (Solomon). It is evident many people were enraged with Adidas after this incident as well, but once again nothing happened to them. They did not continue with the sale of the shoe, yet their profit and sales continued to rise once again despite public scrutiny over the matter.

shackle

Ethical Issues and College Contracts

As just mentioned, Adidas has and is still involved in unethical practices. They continue to exploit workers overseas and, for the most part, ignore all the campaigns and protests against them. As we have seen in class discussion regarding Nike and Adidas, this topic is a complicated one. Trying to figure out whether to blame Adidas or the Indonesian government may seem easy (many blame Adidas), but it is not. Nevertheless, one thing we, as consumers, can control is what products we buy and do not buy, which is where I question people’s judgments. If one family decides to stop purchasing Adidas products for their wrongdoings, nothing will happen to Adidas. But, if large, influential groups of people do, Adidas will have to listen. So, why aren’t the larger entities doing anything about it when there are alternatives within the same industry? The larger entities I am specifically referring to in this paper are college campuses. Over seventy-five colleges have signed a contract with Adidas knowing that they are involved in oversea exploitation, one of which is Bucknell University. After extending our contract with Adidas in 2012, John Hardt, Bucknell director of athletics and recreation states, “We are very pleased to continue our relationship with Adidas. Over the last eight years, our partnership with Adidas has provided Bucknell student-athletes with top-of-the-ling training and game equipment and apparel. The Adidas brand is highly recognized internationally and the ability to align each of our varsity programs with a consistent identity has been extremely positive” (Bucknell). Mark Daniels, director of team sports for Adidas America then responds, “Our goal at Adidas is to help athletes perform better and we are excited to extend our relationship with Bucknell as part of the Adidas family of schools and look forward to their continued success” (Bucknell). Colleges are supposed to foster and support students so they are able to succeed in their future endeavors, but by promoting Adidas, they are hurting the underage children working in the Indonesian factories. How can Bucknell University, a prestigious university, support the wrong-doings of Adidas?

Although Bucknell University has not said or done anything about it, some schools have. A factory in Indonesia that manufactures for Adidas, PT Kizone, did not receive payments for its workers from Adidas. It was reported Adidas was refusing to pay $1.8 million to 2,800 workers. As a result, schools such as Penn State, Michigan and Wisconsin began to “give ultimatums and threaten contract termination. Not coincidentally, that’s when things took a turn for the better for the PT Kizone workers…The agreement is confidential, but a press release from the former PT Kizone workers states, “The former workers will receive a substantial sum from Adidas” (Dosh). Three of the top college sports teams took a stand and were able to influence Adidas into paying workers what they deserved. This clearly shows that if colleges can have a large say in what Adidas does. Their contracts are worth millions of dollars, money Adidas does not want to lose, so they can use this as leverage to increase the conditions in Indonesian factories related to Adidas.

Virtue Ethics

When thinking about Adidas, one may question its ethics. They are a billion dollar company who has been known not to pay under $2 million dollars to workers, pay workers 34p and come up with offensive apparel, all of which are unacceptable. According to Austin Cline, an agnosticism/Atheism expert, “Virtue-based ethical theories place less emphasis on which rules people should follow and instead focus on helping people develop good character traits, such as kindness and generosity. These character traits will, in turn, allow a person to make the correct decisions later on in life. Virtue theorists also emphasize the need for people to learn how to break bad habits of character, like greed or anger. These are called vices and stand in the way of becoming a good person” (Cline). If Adidas were to follow this way of thinking, I do not think they would be doing what they are overseas. The two words that stuck out to me in Cline’s definition are kindness and generosity. Knowing this information about Adidas, I cannot say their company is ethical at all. I do not know how any of their employees can work and continue helping the company knowing that they are not being ethical and moral

Conclusion

            In closing, outsourcing production to other countries has become a major problem for Adidas. Yes, it does save them a lot of money, but it hurts their public relations with various groups of people. There does not seem to be any reason for Adidas to stop doing what they are doing, they are succeeding financially, but hopefully in the near future there will be. Adidas and many other large companies have looked past the ethical standpoint and have tried to block it out completely. There are executives and high up workers at Adidas who have never traveled to Indonesia, most likely because they do not want to know or see what is going on. Because so much production is done overseas, it also makes it difficult for the general public to know exactly what is going on, which plays a role in them not caring about purchasing Adidas products. The only way for companies like Adidas to change their ways is if management finally decides to adhere to virtue ethics or if people decide to fully terminate their contracts until massive change occurs. Colleges are huge money-makers for Adidas and if they took a stand I would not be surprised to see change. So, who is going to be the one to stand up against Adidas on Bucknell’s campus?

           

Bibliography

“Bucknell, Adidas Agree to Multi-Year Extensions.” N.p.,16 June 2011. Web, 12 Nov. 2014

Cline, Austin. “Virtue Ethics: Morality and Character.” N.p., n.d. Web. 22 Nov. 2014.

Collins, Paul. “War on Want Homepage.” War On Want. N.p., n.d. Web. 12 Nov. 2014.

Dosh, Kristi. “Why Are Colleges at Odds with Adidas?” ESPN. ESPN Internet Ventures, 29 Apr. 2013. Web. 20 Nov. 2014.

Solomon, Jesse. “Adidas Cancels “shackle Shoe” after Outcry.” N.p., 20 June 2012. Web. 15 Nov. 2014.

photo 1 = https://c1.staticflickr.com/9/8338/8237135225_4c24b5be4b_z.jpg

photo 2 = http://www.nydailynews.com/life-style/fashion/adidas-pulls-shackle-shoe-outcry-racism-article-1.1098306

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