and how many workers were coerced into extreme long working while being heavily underpaid.
Since this was one of the first instances of a company being accused of violating both workers rights and using underage workers it is fair to assume that Nike did not have an immediate standardized answer for the accusations. Nevertheless, Nike responded and denied that they could not be held responsible for how their sub-‐contractors and suppliers treated their workers.
After the report was released, the case continued to emerge through the media and received heavy focus at the 1992 Olympic games in Barcelona, where Nike sponsored several of the competing athletes. Nike was portrayed by several mediums as an abusive and greedy company that treated workers as expendables in the process of increasing profits.
By 1994 newspapers and magazines such as New York Times, Foreign Affairs, Rolling Stone and The New Republic started to bring the stories of Nike’s abusive sub-‐contractors and in 1995, protests started in front of Nike’s flagship stores. The issue continued to surface until 1998, when Nike started to see the impact in falling sales and realised they had to change.
4.3.2 Water pollution and pesticides
Coca-‐Cola experienced two scandals in India in 2000-‐2008. While the first scandal caused water shortages, over-‐extraction of groundwater and water pollution, the second scandal addressed a more ethical concern of responsibility as an Indian NGO reported evidence of Coca-‐Cola products that contained unacceptable levels of pesticides (Torres et al., 2012).
In 2000, Coca-‐Cola established its production operations in the community of Plachimada in Kerala, in southern India (theguardian.com, 2006). Soon after the Coca-‐Cola’s production began, local people started to claim that they were experiencing water scarcity. In 2003, the government responded to these claims by initiating proceedings against Coca-‐Cola. This resulted in a trial where Coca-‐Cola was brought to court and prohibited from over-‐extracting groundwater (righttowater.info). Despite the company’s own argument that decreasing rainfall was the main cause of draught in the production area, Cola-‐Cola suspended all its production operations by 2004, while they tried to renew the licence to operate within the community of Plachimada in Kerala. Through a long judicial procedure and on-‐going
demonstrations, the company finally succeeded in renewing their licence and resumed production in the area.
Unfortunately in 2006, short after the company had successfully re-‐established their operations, the government reversed the situation, as they banned manufacturing and sale of Coca-‐Cola, due to unsafe levels of pesticides in their beverages (theguardian.com, 2006).
While the investigation of water pollution and over-‐extraction of groundwater took place, an Indian NGO in 2003 published a report providing evidence of high levels of pesticides, which led to several campaigns and demonstrations (csr-‐asia.com). The evidence showed that Coca-‐
Cola from India contained pesticide levels that exceeded European standards. After the evident was brought to the Indian government, they introduced a series of new and more appropriate standards for carbonated beverage (theguardian.com, 2006). Despite not living up to the European standards, the level of pesticides were still considered safe under local standards (Torres et al., 2012), but they arguably still presented an ethical issue. The government therefore concluded that Coca-‐Cola did not violate any national laws. Three years later, in 2006, the Indian NGO published a second report that showed no measurable changes since the first allegations were put forth (csr-‐asia.com).
Finally, in 2008, an independent investigation, made by The Energy and Resources Institute, ended the long-‐standing allegations towards Coca-‐Cola as they concluded that the company’s products were free of pesticides (indiaresource.org). Furthermore, in 2010, Coca-‐Cola’s production in India received a fine of $47 million from the government for damaging the water and soil in Kerala (nytimes.com, 2010).
4.3.3 Factory suicides
One of the more grotesque CSR scandals involves Apple’s suppliers and the suicides of 14 employees at the Foxconn factory in 2010. The Chinese factory is the world’s largest contracted electronics manufacturer, which is also contracted by electronic companies such as Sony and Dell (the.telegraph.co.uk). There are over 900.000 workers at Foxconn, of whom 420,000 work at the Foxconn Shenzhen plant, where iPhones and iPads are manufactured.
The plant consists of 15 factories, including a hospital, a grocery store, restaurants, a bank, and dormitories (the.telegraph.co.uk). Furthermore, the plant offers free access to swimming pools, tennis courts, and 500 LED screens which beam out exercise programmes across the
site. There are also company clubs that organise and offer activities like chess, mountain climbing, fishing, or calligraphy. From the outside, it would seem that Foxconn takes care of their employees and has invested in their workforce. However, it has been documented, that the working conditions for the majority of the workers are both terrible and inhumane.
Back in 2006, local press in China had already reported their concerns for violations of the excessively long working hours, which took place at the Shenzhen plant under the supervision of Taiwanese superiors (Torres et al., 2012). In May 2010 multiple media sources were able to report on several incidents of suicide at Foxconn (the.telegraph.co.uk). During undercover investigations, evidence was gathered by filming an iPhone 6 production line, which showed violations of labour and human rights and that Apple’s promises of protecting their employees were routinely broken (bbc.com). The employees’ rights were violated through the conditions set by Apple’s Supplier Code. Workers were working up to 70 hours per week, ten hours above the agreed maximum hours. They were denied days off and sometimes forced to work up to 18 days in a row, and they were not allowed to interact with each other during work. Workers that violated the rules were penalized with a fine or psychically punished (bbc.com).
Despite the comfortable facilities surrounding the employees, none of the workers had the time to enjoy them. The stressful working conditions resulted in exhausted employees who regularly fell asleep during shifts and workers who continued to twitch their hands during the night because their minds where never able to relax. Furthermore, instead of addressing the stress-‐contributing factors, the factory started to implement safety precautions, such as nets between the dormitories that should prevent more employees committing suicide (the.telegraph.co.uk).
4.3.4 Dieselgate
After several years of promoting “Clean Diesel” as an alternative to hybrid and electric vehicles, Volkswagen was on September 18th, 2015, accused by the US Environmental Protection Agency (EPA) of having fitted almost 500.000 cars with ”defeated software”
(Chicago Tribune, 2016). This software enabled the cars to cheat on emission tests by activating a nitrogen oxide trap that drastically reduced emissions when they were being
tested. Thus, when not being tested, the software would disable the trap to improve performance and fuel economy, but emit almost 40 times the US permitted levels of nitrogen oxides.
Only four days later, on September 22nd, Volkswagen admitted to having equipped 11 million cars worldwide with the “defeated software” and the CEO, Martin Wintercorn publicly apologized. On the 23rd, Martin Wintercorn resigned and took responsibility for the
“irregularities” found by the EPA, but insist he was “not aware of any wrongdoing on [his]
part” (Kollewe, 2015).
In the following days, a series of investigations were launched in both the US and Europe and Volkswagen claimed that a small group of engineers were responsible for the cheating software. They were reportedly suspended. Furthermore, Volkswagen announced to recall more than 8 million cars across Europe and set aside € 6.5 billion to deal with the costs of the scandal.
Looking at the different scandals, they differ from each other in more than one way. First of all, the time in which they occurred and thus what people expected from companies at that time. Secondly, the area of which the company has been caught greenwashing is different and finally how the company has greenwashed.
The Nike case occurred in a time when corporate CSR had not yet become mandatory and people had not nearly the same knowledge about corporate supply chains and business models than they do today. Therefore, the ethical consumer segment described above had not yet been established. Since Nike CSR was not an established corporate concept yet, Nike’s scandal cannot technically be characterised as greenwashing as they did not lie about their actions. However, Nike had still failed to live up to the ethical standards regarding the exploitation of child labour.
In Coca-‐Cola’s case, it is difficult to pinpoint society’s expectations regarding ethical standards, but Coca-‐Cola had already experienced similar problems on a smaller scale in both the US and Belgium before the incident in India. Thus, it would be expected that they were aware of consumers’ demand for non-‐contaminated products. Unlike Nike, Coca-‐Cola had already addressed their own responsibility in relation to their operations and it was these