Business Ethics Now, 4eVideo Lecture Notes
Chapter 1: Understanding Ethics
Nike Reaches Tipping Point, Terminates Armstrong Contract
Run Time: 4:29
Link:
Summary
Nike’s decision to terminate its relationship with cyclist Lance Armstrong came as a bit of surprise to some and a bit too late for others. The decision to drop the seven time winner of the Tour de France came as public pressure intensified amid mounting speculation that Armstrong had used prohibited performance enhancing drugs while competing. Indeed, Nike cited the seemingly insurmountable evidence that Armstrong was guilty of doping as the reason for the end of the multi-year relationship. Earlier in the day the beleaguered athlete had stepped down from his position as head of the charity he had started, Live Strong.
Speculation that Armstrong was cheating has dogged the athlete for years despite his claims of innocence. During much of this time, Nike has stood by Armstrong, expressing strong commitment to their relationship even as rumors of his misconduct continued. In fact, just a few days prior to the announcement that their relationship was ending, Nike had publicly announced its support for Armstrong despite a negative report by the United States’ anti-doping agency.
Nike has a history of supporting disgraced athletes. The company initially stood by Tiger Woods when it was revealed that he had been engaged in numerous extramarital affairs notwithstanding criticism from the public. Now, though, it seems that Armstrong’s doping scandal has reached the point at which Nike is concerned that continuing the relationship will only serve to harm its own reputation as an ethical and moral company.
Discussion Questions
1. Did Nike really have a choice as to whether to terminate its relationship with Lance Armstrong? Did the decision to end the association come too late? What else, if anything, should Nike have done?
2. Consider ethics and personal integrity. Is there any difference between how Lance Armstrong acted as compared to Tiger Woods? In your opinion, do athletes that have reached celebrity status like Armstrong and Woods live by a different moral compass than other athletes?
3. Nike terminated its relationship with Lance Armstrong only when the pressure from the public to do intensified. Is it rightfor companies like Nike to stand by their spokespeople when they are behaving in unethical ways?
4. How would you interpret this situation using the Golden Rule? Consider your response both from the perspective of Lance Armstrong and from the perspective of Nike’s CEO.
5. Consider the implications of Lance Armstrong’s fall from grace for the charity he started, Livestrong. Should the charity distance itself from the athlete?
1-1