Blog Post 4: Ethical Decision-Making/Grassroots Diplomacy Case: September 13, 2021
Team: Aidan, Alyssa, Carol, Jon, Layan
Date Submitted: 9/18/22
While traveling through Philadelphia in the summer of 2012, Ugochi Wilson got mugged by a young man in a high-crime neighborhood. Ugochi was deeply affected and moved by this incident, and started researching the challenges faced by young people in urban centers and the work done by non-profits to support them. She was astounded by how significant and complex the street crime issue was and how it impacted every aspect of life in these communities. Talking to local nonprofits educated her on the challenges of poor education and systemic racism that strengthened the school-to-prison pipeline and trapped youngsters in the vicious cycle of poverty. In conversations with the primary stakeholders, it became evident that the young people lacked the voice and vision to bring forth their concerns and co create viable solutions with various government actors, non-profits, and local businesses.
Ugochi, a serial entrepreneur, launched a social venture to give these vulnerable youth a voice and build their confidence to become employable and responsible adults. Ugochi launched a multi-pronged approach against homelessness and hopelessness through the global language of soccer. She founded the Soccer for Youth Empowerment Tournament (SYE-T).
SYE-T engages vulnerable young people in urban city centers across the U.S. in soccer coaching and tournaments. SYE-T staff members coach soccer camps in various cities and form city teams that participate in regional tournaments every three months. Over the course of a week, the young people play soccer, participate in leadership workshops, explore career pathways, and strengthen their communication and teamwork skills. These young people develop a growth mindset and learn how to channel their passion and talents to create happiness for themselves and others. The winners of the regional competitions compete for the national title once a year. Even the teams that don’t make it to national level attend the week-long tournament for personal and professional development. They learn how to socialize, relate with others, and become responsible adults. Local businesses in all of the host cities like to interact with and hire these youth. Today, although only 400 players from 20 cities compete in the regional tournaments, it has been estimated that about 30,000 youth benefit every year from pre-selection training and program engagement.
The first three tournaments that Ugochi organized had a total budget of about $100,000 which she raised from more than 600 supporters. The contributions ranged from $10 to $10,000 and many of them came with hand-written notes expressing their gratitude and support. One-third of the funds came directly from the youths’ communities. Ugochi was successful in securing in-kind support — uniforms to plane tickets to food and lodging — from over 50 organizations. Schools and churches provided their grounds for practices, healthcare systems provided free check-ups and preventive health education, and local photographers gifted them professional headshots. The supporting businesses had the opportunity to get to know some of these bright young people and hire them. Local community colleges and universities opened their doors and helped these marginalized youth explore opportunities for higher education.
In 2015, a major shoe manufacturer (we’ll call them…Spikey) sponsored the program to the tune of $2 Million which enabled Ugochi to expand the number of participating cities from 5 to 15. Spikey received excellent publicity through SYE-T, and their sales in participating cities skyrocketed. Spikey quickly recognized the opportunity for financial gain while projecting a socially-progressive brand image. Over a period of five years, their tax-free donation increased from $2 Million to $6 Million, which enabled thousands of young people from over 20 cities to participate. During those same five years, the entities providing Ugochi with in-kind support started dropping out, grossly raising the overall cost of the event (though all of the expenses were covered by Spikey). Gone were the workshops on finding purpose and building community. There were no professional headshots or rope courses to build teamwork skills. But there was more soccer, more competitive than ever, and for many more youth.
Part 1:
Fast forward to August 2021. Ugochi has found herself in a difficult situation, for it has come to light that three of the contractors that manufacture Spikey’s shoes in Cambodia employ children under the age of 12 at their facilities. One contractor restricts employment to 20 hours a week and, through their “study-to-work program,” mandates that children attend an on-campus school before they are allowed to work and support their families. The other two contractors expect the children to work upwards of 60 hours a week and provide no educational benefits. Spikey executives insist that the contractors are in compliance with Cambodian law and their PR staff are working aggressively to contain the fallout from the story. They have assured Ugochi that they remain steadfast supporters of SYE-T and might even increase the level of sponsorship with some strings attached. Ugochi is concerned not just about the labor practices employed by Spikey and their contractors but also how SYE-T is striving to address a major challenge in the U.S. while being complicit in perpetuating a similar problem abroad. She is wondering whether she should continue accepting sponsorship from Spikey or not. If you were Ugochi, what would you do?
Part 2:
Ugochi has a meeting with the head of Corporate Social Responsibility (CSR) for Spikey. Mr. Mikey evades all questions about the Cambodia situation and insists that there is nothing to worry about. Based on his conversations with senior management, he proposes that the focus of the competition should not be on vulnerable youth. After all, last year there were a few confirmed incidents of youth smoking marijuana before playing soccer, which creates bad optics for Spikey. Also, Spikey wants the competition to only include men over the age of 18 to make it more competitive. Mr. Mikey makes an off-hand comment that there isn’t much interest in women playing soccer anyway. When Ugochi objects to the idea of excluding women, he suggests that women could be involved as cheerleaders. There is a heated argument that ends in Mr. Mikey threatening to stop sponsoring the event. Ugochi realizes that she stands to lose 80% of her funding if Spikey backs out of their sponsorship deal. With only 20% of her previous funding, she will have to scale down operations significantly and greatly restrict the number of participants, which would be devastating to thousands of youth, their families, and their volunteer coaches. Mr. Mikey asks Ugochi to think about it and come back in a week for a meeting at a venue of her choice. If you were Ugochi, what would you do?
Part 1: Ethical Decision Making
Step 1: Determine the facts in the situation – obtain all of the unbiased facts possible. Clearly state the ethical issue.
- Ugochi was mugged in Philadelphia in the summer of 2012.
- Ugochi decided to research the challenges faced by young people in urban areas and how nonprofits were responding to these challenges.
- Ugochi founded a social venture as a response. She called it Soccer for Youth Empowerment Tournament (SYE-T), which included more activities than soccer.
- Ugochi designed the organization to help urban youth find their voice.
- SYE-T targeted at-risk youth throughout the U.S. Their staff coached soccer camps in various cities and formed city teams engaged in regional tournaments every three months. But during the week, these kids learned other life and leadership skills. They also had the chance to compete for the national title yearly.
- Four hundred players from 20 cities competed in the regional tournaments.
- 30,000 youth benefited every year from SYE-T’s engagement in communities.
- When she started her first three tournaments, one-third came directly from youths’ communities, and many expressed gratitude and support.
- The social venture also received in-kind support from 50 organizations, including plane tickets, food, lodging, uniforms, practice space, free health checkups, preventive health education, professional headshots, hiring these youth, and access to higher education.
- Spikey became a significant funder in 2015, which allowed them to expand their efforts to 15 cities, up from 5 cities.
- Because of positive PR as a socially-progressive brand, Spikey tripled its tax-free donations in five years, allowing SYE-T to serve youth in over 20 cities.
- Ugochi lost much of her previous funding, and costs increased after Spikey became more supportive/controlling.
- Spikey is involved in a PR problem because it was discovered that three contractors that make their shoes in Cambodia use child labor from children under 12 years old.
- Manufacturer 1: restricted work to 20 hrs per week, but they were required to attend on-campus school before they could work.
- Manufacturers 2 and 3: expected children to work 60 hrs per week and provided no educational opportunities.
- Ugochi could lose 80% of her funding if she does not continue to receive Spikey’s financial support.
The Ethical Issue:
Part 1: Ugochi needs the money from Spikey so she can continue expanding her organization to reach and help more kids/communities but Spikey has been directly linked to sweatshops, one of which exploits children. Ugochi must decide whether she should decline the donation and drastically scale back the size and effect of the organization or to accept the money despite social backlash.
Step 2: Define the Stakeholders – those with a vested interest in the outcome
- Spikey
- Ugochi
- Members of the community
- Soccer players under 18 years old
- Competitive male soccer players over 18
- Children involved in child labor
- Female youth involved in the organization
- Local businesses
Step 3: Assess the motivations of the Stakeholders
- Spikey
- Receive good publicity for sponsoring a social venture.
- Could make more revenue if people are more interested in their proposed over-18 league
- Ugochi/SYE-T
- Receives massive amounts of funding to run her organization and reach more youth.
- Opening up to additional funding opportunities by noting they received funding from Spikey, a large corporation.
- Members of the community
- Are offered the opportunity for social and professional development through Ugochi’s program if it continues to be sponsored.
- Businesses are able to market themselves by helping out
- Soccer players under 18 years old
- Develop more maturity, security, and access to community-based supports reaping the program’s benefits.
- Would have less time to engage in harmful or illegal behavior.
- Competitive male soccer players over 18
- Good publicity
- Might expose themselves to opportunities for their adult life (could be soccer or college).
- Children involved in child labor at the contractors that Spikey uses
- Make money to support their family but face awful work conditions. If Spikey continues to receive negative press on using the contractors, they might not use them and these children might no longer be employed, so they cannot support their families.
- Female youth involved in the organization
- Develop more maturity, security, and reap the benefits of the program
- Local Businesses
- Exposure
- A good relationship with community
- Access to future employees, clients, etc.
Step 4: Formulate (at least three) alternative solutions – based on information available, using
basic ethical core values as guide
Approaches [1/2/3: repeat for every action]
Potential solution 1
- Ugochi immediately approaches the social venture’s board of directors with a strategic plan to step down funding from Spikey while seeking out other funding opportunities.
- Ethical Principle or code
- Not selling out and going back on the initial mission of the organization.
- Would demonstrate that rejecting the funding entirely can negatively affect the youth and families they serve.
- SYE-T was explicitly created to help vulnerable youth. If they continue to accept funding from Spikey, which is exploiting vulnerable youth in Cambodia, turning a blind eye to Spikey’s business practices would violate their principles.
- Pros
- Approaching smaller possible funders to gradually reinstate their funding (soccer fields, lodging, health checkups, etc.)
- It keeps the families, who depend on the organization to keep their children involved in prosocial activities, from suddenly having to find other ways to assist their children. The kids would then continue to have access to the valuable services offered by SYE-T.
- Cons
- A large amount of fundraising is needed to make up the difference
- Inevitable scale down in the short term
- Deprives children and families of resources
- Spikey may react by entirely pulling funding after hearing Ugochi’s desire to gradually decrease.
Potential solution 2
- Ignore that Spikey is using contractors who rely on underage workers and dodge any questions related to this matter. Hence, following Spikey’s lead of ignoring the matter. However, SYE-T would remain focused on the future by diversifying their funding sources and in-kind supporters to other medium-large sized entities. The organization would then return to its initial mission of helping the youth find purpose and building community.
- Ethical Principle or code
- Protect the interests of the children the organization was founded to protect
- The inevitable scale-down after rejecting Spikey’s funding would undo work done by SYE-T
- Pros
- Spikey’s contractors’ sweatshops were not breaking any Cambodian laws by using child labor.
- Kids stay out of trouble.
- The public could forget about Spikey’s controversy.
- Spikey would be doing at least some good by funding an ethical cause
- Eventually, SYE-T would be receiving a more diverse mix of funding.
- Cons
- Endorsing child labor
- The people may lose trust in the organization
- The organization still strays away from its initial mission
- Furthering the “sell out” stigma behind the organization
Potential solution 3
- SYE-T schedules a Community Forum to discuss the funding crisis the organization is facing. It would be open to all the kids, their families, and 50 entities who had previously provided so much in-kind support. The media is invited.
- Ethical Principle or code
- Honor the voices of all of the stakeholders
- Understand what the families, kids, and entities want
- Avoids selling out and would return to the initial mission of the company
- Pros
- Stakeholders have a say in the outcome
- Liability spread out
- Would give insight into how quickly they could regain the support from those entities if they were to reject the funding
- They could open themselves up to additional donors who could fill the gap because they are making this crisis a very public matter.
- Cons
- Difficult to organize a community meeting.
- It could create additional bad PR for Spikey.
- If the community makes it clear that they want Ugochi to refuse the money, Ugochi is back at square one with the same decision to make.
- Less control over decision
- Runs the risk of the entities not wanting to offer their services back and Spikey could withdraw funding upon hearing SYE-T is interested in rejecting the donation. This would leave the organization in a worst-case scenario.
Step 5: Seek additional assistance, as appropriate – engineering codes of ethics, previous cases, peers, reliance on personal experience, inner reflection
Step 6: Select the best course of action – that which satisfies the highest core ethical values.
Explain reasoning and justify. Discuss your stance vis-a-vis other approaches discussed in the class.
The best course of action is to continue accepting Spikey’s sponsorship. Spikey ‘s value towards fulfilling the SYE-T mission of helping at-risk children outweighs the ethical issues at play with them using underage works in a foreign country. Ugochi and her organization have a responsibility towards the youth and their families who have grown to depend on them over the years.
However, SYE-T would remain focused on the future by diversifying their funding streams. She could seek in-kind and financial support from medium to large sized entities or even governmental backing, for example from Community Development Block Grants. The organization would then return to their initial mission of helping the youth find purpose and building community. Additionally, it takes monetary relief off of local businesses with less of a budget to spend, but they could still be engaged and able to connect with the youth directly.
Ugochi could also engage in a PR campaign of her own to collect testimonials of youth helped by SYE-T. The organization could demonstrate how the program helped at-risk youth not join gangs, attend college, and obtain good paying jobs. This would publicly expose the value of SYE-T in countless communities they serve. The goal would be to never mention the Cambodian controversy but instead focus on how all the funds they have received over the years, from Spikey and others, helped them fulfill their mission and the impact that has had.
Step 7: (If applicable) What are the implications of your solution on the venture. Explain the
impact of your proposed solution on the venture’s technology, economic, social and environmental aspects.
- Technology: Continued funding from Spikey would allow them to improve on the technology used to engage the youth. A sudden loss of financing could be too much of a shock to the organization and would undoubtedly affect the technology they use.
- Economic: Continued funding would keep the organization financially viable.
- Social: The organization could take a hit in this regard because continued acceptance of funds from Spikey might make the SYE-T appear hypocritical. However, Spikey’s funding allows more opportunities for the youth through soccer and other positive benefits associated with the additional funders.
- Environmental: Spikey has created safer neighborhoods that protected green spaces used for soccer fields. If not for this program, these spaces might have become blighted.
Part 2: Grassroots Diplomacy Strategy Development Methodology
Step 1: Determine the facts in the situation – obtain all of the unbiased facts possible
- Ugochi was mugged in Philadelphia in the summer of 2012.
- Ugochi decided to research the challenges faced by young people in urban areas and how nonprofits were responding to these challenges.
- Ugochi founded a social venture as a response. She called it Soccer for Youth Empowerment Tournament (SYE-T), which included more activities than soccer.
- Ugochi designed the organization to help urban youth find their voice.
- SYE-T targeted at-risk youth throughout the U.S. Their staff coached soccer camps in various cities and formed city teams engaged in regional tournaments every three months. But during the week, these kids learned other life and leadership skills. They also had the chance to compete for the national title yearly.
- Four hundred players from 20 cities competed in the regional tournaments.
- 30,000 youth benefited every year from SYE-T’s engagement in communities.
- When she started her first three tournaments, one-third came directly from youths’ communities, and many expressed gratitude and support.
- The social venture also received in-kind support from 50 organizations, including plane tickets, food, lodging, uniforms, practice space, free health checkups, preventive health education, professional headshots, hiring these youth, and access to higher education.
- Spikey became a significant funder in 2015, which allowed them to expand their efforts to 15 cities, up from 5 cities.
- Because of positive PR as a socially-progressive brand, Spikey tripled its tax-free donations in five years, allowing SYE-T to serve youth in over 20 cities.
- Ugochi lost much of her previous funding, and costs increased after Spikey became more supportive/controlling.
- Spikey is involved in a PR problem because it was discovered that three contractors that make their shoes in Cambodia use child labor from children under 12 years old.
- Manufacturer 1: restricted work to 20 hrs per week, but they were required to attend on-campus school before they could work.
- Manufacturers 2 and 3: expected children to work 60 hrs per week and provided no educational opportunities.
- Ugochi could lose 80% of her funding if she does not continue to receive Spikey’s financial support.
- Additional facts
- Ugochi met with Spikey’s head of Corporate Social Responsibility, Mr. Mikey.
- Mr. Mikey said that in his conversations with senior management, they propose that the focus of the competition they sponsor should not be vulnerable youth but only men over 18 to ensure that it is more competitive.
- Mr. Mikey further alluded to excluding females and perhaps instead have them as cheerleaders.
The Ethical Issue:
Part 2: Ugochi needs the money from Spikey but Spikey is beginning to interfere with the way the organization works and driving it in a direction that does not align with its original goals. Ugochi must decide whether she should let Spikey have a say in the organization so she can stay on their good side and continue to receive funding or whether she should decline funding for the sake of preserving the purpose of the organization.
Step 2: Define the problem and the stakeholders – those with a vested interest in the outcome
- Problem: The mission of Spikey conflicts with the original mission of SYE-T
- Stakeholders:
- Spikey
- Ugochi
- Members of the community
- Soccer players under 18 years old
- Competitive male soccer players over 18
- Children involved in child labor
- Female youth involved in the organization
- Local businesses
- Mr. Mikey
Step 3: Determine and distinguish between the personal and professional motivations of the stakeholders.
- Spikey
- Receive good publicity for sponsoring a social venture
- Could make more revenue if people are more interested in their proposed over-18 league
- Ugochi
- Receives massive amounts of funding to run her organization
- Members of the community
- Are offered the opportunity for social and professional development through Ugochi’s program if it continues to be sponsored.
- Soccer players under 18 years old
- Develop more maturity, security, and access to community-based supports reaping the program’s benefits.
- Less time to engage in harmful or illegal behavior.
- Competitive male soccer players over 18
- Good publicity
- Possibly open opportunities for their adult life (could be soccer or college)
- Children involved in child labor at the contractors that Spikey uses
- Make money to support their family but face awful work conditions. If Spikey continues to receive negative press on using the contractors, they might not use them and these children might no longer be employed, so they cannot support their families.
- Female youth involved in the organization
- Develop more maturity, security, and reap the benefits of the program
- Local Businesses
- Exposure
- A good relationship with the community.
- Goodwill; future employees, clients, etc.
- Mr. Mikey
- Using CSR to increase Spikey’s bottom line which could benefit him professionally
Step 4: Formulate (at least three) alternative solutions – based on information available, to have a win-win situation for your relationship and your venture.
Approaches [1/2/3: repeat for every action]
Potential Solution 1: Ugochi could view Mr. Mikey’s suggestions as completely unacceptable. She could then decline all of Spikey’s funding.
- How does it solve the problem?
- Pros:
- Have the opportunity to diversify their funding
- SWE-T will not implicitly endorse child labor
- SWE-T will keep their original mission and client base
- Cons: SWE-T has lost 80% of its funding
- How does it save face of those involved?
- SWE-T does not need to change the way they operate or be associated with a company that uses child labor
- The mission of connecting with community will be restored, contingent upon local businesses resuming their original funding to SWE-T
- Implications on relationships
o Short-term: Bridges burned with Spikey
o Long-term: opportunity to reconnect with the community
- Implications on the venture
o Short-term: might have to scale back for a few years
o Long-term: Ultimately, SWE-T would have stronger ties with the smaller
sponsors and be able to provide better quality services
Potential Solution 2: Ugochi should become hyper focused on persuading Mr. Mikey and Spikey to reconsider their proposals. She can remind Spikey of the organization’s mission and say they are unwilling to compromise on what it was established to do, which was to assist vulnerable youth by building their employability skills and becoming responsible adults. She could say that they would continue to serve all kids, male and female, including those under 18. She should remind Spikey of the benefits they have received over all the years they have sponsored her organization and how it counterbalances the negative PR they are receiving from the Cambodian subcontractors using underage workers. Ugochi could also increase the positive marketing of Spikey to build public goodwill. This would dissuade them from the divergent direction they were proposing for SYE-T. If Spikey was not supportive of this, SYE-T would be forced to decline their funding.
- How does it solve the problem?
- Pros
- Potentially keep Spikey’s funding while also still serving their community.
- Cons
- Mr. Mikey could say no and then the organization loses 80% of funding or resort to a different solution
- How does it save face of those involved?
- SYE-T does not need to change the way they operate or be associated with a company that uses child labor
- Mr. Mikey/Spikey takes time to reconsider.
- Mr. Mikey can spin this to Spikey’s senior leadership as positive, “free” PR.
- Implications on relationships
o Short-term: She cannot trust Mr. Mikey and Spikey’s senior leadership.
o Long-term: The relationship becomes strained.
- Implications on the venture
o Short-term: Uncertainty of funding.
o Long-term: Awareness for Ugochi/SYE-T of how to handle mission creep and large funders creating compromises to what the organization stands for.
Possible Solution 3: Ugochi could agree to Spikey funding a program just for males over 18, that would be more competitive. However, she argues for Spikey’s funding to continue to be used for programming for youth under 18 including females. It’s a win-win situation.
- How does it solve the problem?
- Pros
- Spikey gets to fund programming for males 18 years old and over that is more competitive in nature.
- SYE-T remains financially solvent, which allows it to retain its original mission of helping youth.
- Cons
- Requires additional efforts to plan for services to males 18 years and over.
- Opening the door to additional mission creep by Spikey.
- How does it save face of those involved?
- SYE-T remains operational without the loss of 80% of their funding.
- Spikey is not publicly criticized for suggesting to deny females and youth under 18 access to SYE-T’s programs.
- Implications on relationships
o Short-term: Spikey can view SYE-T in a favorable light because they were willing to accommodate the wishes of Spikey.
o Long-term: Perhaps respect that compromises could be achieved. The converse is also possible. There could be resentment from SYE-T that they are too beholden to their large donor that might make them change their programs on a whim.
- Implications on the venture
o Short-term: funding is maintained for original programming, additional facet is added to the organization
o Long-term: Partnership with Spikey is maintained, but solution does not prevent future power grabs by Spikey
Step 5: Seek additional assistance, as appropriate – previous cases, peers, reliance on personal experience, inner reflection
- Ugochi could consult with her peers and other nonprofit organization leaders for advice.
- Ugochi could hire a consulting firm to help her and the board navigate the PR and funding issues.
- Ugochi could put together a small committee of community professionals and leaders that could help her make the decision.
Step 6: Select the best course of action – that solves the problem, saves face and has the best short-term and long-term implications for your relationship and venture. Explain reasoning and discuss your solution vis-a-vis other approaches discussed in class.
Potential Solution 2: Ugochi should become hyper focused on persuading Mr. Mikey and Spikey to reconsider their proposals. She can remind Spikey of the organization’s mission and say they are unwilling to compromise on what it was established to do, which was to assist vulnerable youth by building their employability skills and becoming responsible adults. She could say that they would continue to serve all kids, male and female, including those under 18. She should remind Spikey of the benefits they have received over all the years they have sponsored her organization and how it counterbalances the negative PR they are receiving from the Cambodian subcontractors using underage workers. Ugochi could also increase the positive marketing of Spikey to build public goodwill. This would dissuade them from the divergent direction they were proposing for SYE-T. If Spikey was not supportive of this, SYE-T would be forced to decline their funding.
Ugochi would be using indirect pressure. She should also access senior management at Spikey and other ways to exert influence to help Spikey reconsider the direction they are proposing for SYE-T. This is a way for them to save face.
This approach allows for Spikey, through Mr. Mikey, to save face when Ugochi makes it clear the direction they are proposing is not something she’s willing to entertain but it provides benefits to Mr. Mikey.
Step 7: List the sequence of actions you will take to implement your solution.
- Prior to her follow-up meeting with Mr. Mikey, Ugochi should try to influence Spikey’s leadership to dissuade them from their proposed recommendations to change SYE-T’s programming.
- Ugochi holds an emergency meeting with her board of directors to plan the talking points during her meeting with Mr. Mikey. During the meeting, she:
- Reminds Spikey of the organization’s mission and say they are unwilling to compromise on what it was established to do, which was to assist vulnerable youth by building their employability skills and becoming responsible adults.
- Remains firmly committed to continuing to serve all kids, male and female, including those under 18.
- Notes all the benefits Spikey received over all the years they have sponsored her organization and how it counterbalances the negative PR they are receiving from the Cambodian subcontractors using underage works.
- Ugochi would suggest increasing positive marketing of Spikey to build public goodwill. This would dissuade them from the divergent direction they were proposing for SYE-T.
- If Spikey was not supportive of this, SYE-T would be forced to decline their funding.
Lessons Learned from the case:
- Funding is not neutral or positive. I can be associated with an individual or entity whose brand’s image could detract from the social venture’s mission.
- Everyday people tend to forget about any wrongdoing from a company with time. Scandals are more likely to blow over with the next news cycle.
- It is important to remember your purpose and stay true to your mission.
