multinational Companies Case Studies

Question 1

multinational company affecting development

Answer 1

Nike in Vietnam

Question 2

advantages of Nike investing in Vietnam

Answer 2

• created employment opportunities
• inward investment and payment of taxes has allowed the government to invest in infrastructure health care and education in local areas
• workers at the Nike factory have an average monthly wage of $54 which is three times higher than most stated own companies
• employees are given free or subsidised meals during their shifts
• many workers receive free medical services as well as training and education opportunities which improves their skills
• helps attract other multinational companies to Vietnam
• Nike employs 350,000 workers in 150 factories

Question 3

disadvantages of Nike investing in Vietnam

Answer 3

• wages are often low and people are forced to work overtime
• conditions in factories are said to be dangerous
• cohabitation of trade unions gives workers very few rights
• accusations of child labour damages the companies reputation as they are often described as sweatshops- strikes in 2007, 2008 and 2010
• The companies image and its advertising may undermine national cultures
• workers only get $1.25 a day
• The jobs aren’t secure as branch plants can pull out very easily

Question 4

management of Nike investing in Vietnam

Answer 4

• introducing a new code of conduct for its factories in 1999
• increasing the legal working age to 17
• making workers more aware of their rights and entitlements
• it is eliminating the use of toxic solvents and glues in production of trainers