What is unethical business practices??

Unethical behavior in business refers to actions that fail to rise to acceptable standards of business practices. As you can see, unethical business practices can creep into every type of business imaginable.We should also raise the bar and hold businesses to a higher standard of conduct.

Some of the common unethical business practices done by many businesses all over the world for success are:

• Misleading Product Information

Many companies promote injurious products with misleading information that can be harmful to consumers or the environment, purely for the sake of improving the bottom-line.

Maker of Nutella, Ferrero USA, Inc. had to pay $3.05 million as settlement for a lawsuit filed in New York for pitching the chocolate spread as a nutritious breakfast for children.

In 2015, the biggest German carmaker, Volkswagen, publicly accepted that it had installed software in several of its cars to fool the Environmental Protection Agency’s emissions testers into believing that the cars were environmentally friendly. The popular brand lost a staggering $20 billion in market capitalization and was badly hit by the negative publicity.

• Unfair Competition

Defamation of a competitor, misappropriation of their trade secrets, and trade mark infringement – all these fall under unfair competition which gives a wrong impression to the consumers about the competitor and its products.

In 2009, PepsiCo sued Coca-Cola for promoting its sports drink, Powerade, as being more refreshing than PepsiCo’s Gatorade because it contained more electrolytes. However, PepsiCo argued that there was no scientific evidence behind the claim.

• Mistreating Employees

This has become a familiar scenario in small as well as big companies who make employees work for long hours and underpay them. Many employees are made to work under stressful conditions and are subjected to mental and even sexual harassment.

• Manipulating Accounts

Most companies are involved in the cooking of their books to hoodwink investors, lenders and end-consumers. They tweak their financial reports to show inflated profits and lowered depreciation. This makes investors think that the company is faring well, and they end up buying more stocks from the share market.

In 2015, Toshiba, the Japanese multinational, was held responsible for the mismanagement of its accounts. They exaggerated their profits by $1.2 billion for more than seven years.

Nike's Unethical Practices

As we all know that Nike  is an American multinational corporation that is engaged in the design, development, manufacturing, and worldwide marketing and sales of footwear, apparel, equipment, accessories, and services.

The company is headquartered near Beaverton, Oregon, in the Portland metropolitan area. It is the world's largest supplier of athletic shoes and apparel and a major manufacturer of sports equipment.

But as one of the world’s largest athletic brand, Nike faces great criticism in regards to their use of labor sweatshops in Asia.

• Employees were forced to work over sixty hours each week and were punished if they refused to work overtime.
  
• In these sweatshops, women are much underpaid, hardly enough to cover their basic living.

Workers have claimed to be both verbally and physically abused by their employers.

Although the use of sweatshops in Asia reduce production costs and enable companies to rake in much greater revenue, the importance of morals and ethics still come into play. Being such a popular and well-known brand, Nike has an image to uphold. Though Nike claims to put effort into resolving these issues of abuse among their factories, some are skeptical as to how dedicated Nike really is to put an end to the horrendous working conditions of their Asian factories.