Apple has and continues to make its largest social responsibility investments in the area of supply chain management which has receive global attention and scrutiny. As mentioned in my early blog postings, Apple’s global manufacturers, primarily Foxconn, have dealt with accusations of poor employee work conditions, riots, employee suicides and military-like guards enforcing long hours and low pay. These issues have impacted Apple’s reputation with many stakeholders and Apple has recognized that “more and more, a reputation for corporate social responsibility is vital to doing business” (Palmer, 2008) so has continually improved their supplier code of conduct mandate. Apple is “committed to driving the highest standards for social responsibility throughout our supply base” and demands that “suppliers must live up to Apple’s Supplier Code of Conduct as a condition of doing business with us (“Apple supplier responsibility 2012 progress report”, 2012, p. 3). Additionally, Apple has introduced more internal and external assessments.
Apple has made significant strides in its own internal auditing of those in its supply chain. In 2011, Apple’s Supplier Responsibility team conducted 229 audits, with more than 100 at factories never audited before, which was an 80% increase in the number of audits made in 2010 (“Apple supplier responsibility 2012 progress report”, 2012, p. 4). Apple auditors, who are fully trained in every aspect of the supplier code of conduct, are placed at supplier’s facilities to lead each audit. These auditors are supported by local third-party auditors and materials experts to monitor and measure compliance with all mandates in the supplier’s code of conduct (“Apple supplier responsibility 2012 progress report”, 2012, p. 5). Apple reports that these increased audits have shown significant improvements in “facilities where we conduct repeat audits consistently show fewer violations, and the vast majority improve their audit scores year-over-year” (“Apple supplier responsibility 2012 progress report”, 2012, p. 4).
Apple has recognized that internal audit is not enough and “takes these demands for accountability, responsibility and transparency very seriously” (Waddock, 2009, p. 285) so has worked with the Fair Labor Association (FLA) to become the first technology company they have accepted. The FLA Workplace Code of Conduct defines labor standards that aim to achieve decent and humane working conditions. In addition to Apple’s Supplier’s Code of Conduct, Apple suppliers will now be required to be compliant with laws of their own country as well as the FLA Workplace Code of Conduct. The FLA Workplace Code of Conduct provides specific guidelines and requirements in the areas of employment relationships, nondiscrimination, harassment/abuse, forced labor, child labor, freedom of association and collective bargaining, health/safety and environment, hours of work and compensation. The FLA then goes on to actively monitor compliance of the Workplace Code of Conduct and works with companies to develop sustainable mechanisms to ensure ongoing compliance (“FLA workplace code of conduct”, 2012).
With all the improvements in the supplier code of conduct and the number of audits performed, there is still a question as to whether Apple is doing enough. Although Apple has had a supplier code of conduct in place for years as recently as 2 months ago riots erupted in China which led many to question why Apple is still in China (Bloomberg News, 2012). Will their recent alliance with the FLA change the work conditions still found in many supplier facilities? Or will Apple need to enforce their own policies and stop doing business with Foxconn, their largest supplier? Hopefully, Apple’s Supplier Responsibility 2013 Progress Report will continue to report 80% increase on the number of facilities inspected and better compliance by all in their supply chain.
Apple supplier code of conduct. (2012, 03 04). Retrieved from http://www.apple.com/supplierresponsibility/code-of-conduct/
Apple supplier responsibility 2012 progress report. (2012, 11 01). Retrieved from http://images.apple.com/supplierresponsibility/pdf/Apple_SR_2012_Progress_Report.pdf
Bloomberg News (2012). Foxconn Workers Labor Under Guard After Riot Shuts Plant. Bloomberg News. Retrieved from http://www.businessweek.com/news/2012-09-26/foxconn-workers-labor-under-police-watch-after-riot-shuts-plant
FLA workplace code of conduct. (2012, 11 02). Retrieved from http://www.fairlabor.org/our-work/labor-standards
Palmer, A. (2008). Do the Right Thing. (cover story). Incentive, 182(7), 16.
Waddock, S. (2009). Leading Corporate Citizens: Vision, Values, Value Added. New York, NY: McGraw-Hill Irwin.