GLOBAL MARKETING AND ETHICS
Apple and many, if not most, companies today are taking their operations global. Manufacturing in particular is being taken to China. This can mean much higher profits for a company, but there are other implications to consider here. In pursuit of the highest possible profits, often a company will overlook unacceptable practices of its outside suppliers. A “don’t ask, don’t tell” attitude is frequently adopted. Even when companies make commitments to the environment and respecting workers, the same commitment cannot always be counted on from outside suppliers. This happened even with Apple, a company known for being incredibly controlling. The rotten practices of Apple partner suppliers make us question, once again, the ethics of the company and also the significance of globalization.
Global marketing relations not only open up foreign markets of consumers, but also a foreign workforce, which is often a much cheaper workforce. Companies, in pursuit of lowest-cost providers for optimal profits, are now typically looking globally to manufacture and outsource work. Job outsourcing has been highly controversial, not only because it threatens job stability and wages here in the US, as more and more manufacturing, technical, and higher skilled, higher paying jobs are being exported, but also because of the sometimes questionable working conditions in many developing nations.
Apple’s 10K report states, “Currently, the supply and manufacture of many critical components is performed by sole-sourced third-party vendors in the U.S., China, Germany, Ireland, Israel, Japan, Korea, Malaysia, the Netherlands, the Philippines, Taiwan, Thailand and Singapore. Sole-sourced third-party vendors in China perform final assembly of substantially all of the Company’s Macs, iPhones, iPads and iPods. If manufacturing or logistics in these locations is disrupted for any reason, including but not limited to, natural disasters, information technology system failures, military actions or economic, business, labor, environmental, public health, or political issues, the Company’s financial condition and operating results could be materially adversely affected.” This suggests that a lot of Apple’s manufacturing is done by foreign suppliers and that they out-source much of the production process.
Apple assures us that they are “committed to ensuring the highest standards of social responsibility in everything [they] do… and use environmentally responsible manufacturing processes wherever Apple products are made.” Apple has a Supplier Code of Conduct, which they require their suppliers to commit to and they audit their suppliers for compliance. Apple also points out that they go “beyond compliance” to assure “safe working conditions and to treat workers with respect.”
When Apple discovers a violation of our Code, we demand immediate corrective actions. If the violation appears to be common across a section of our suppliers, we take broader measures to build a foundation for sustainable compliance.
Apple’s Supplier Responsibility 2011 Progress Report gives “details about Apple’s efforts to improve worker protections and factory conditions.” The report also includes results of recent audits, how they monitor for compliance, and how they have dealt with those that have not – all the bad apples. The report reveals some bad news: underage workers in countries that had a minimum working age of 16, over 50 factories keeping workers on the job for longer than the maximum 60 hour work week and at least 24 factories paying workers less than the minimum wage, among other controversial issues. This was all found by the company’s own audits. The company has taken steps to fix some of these problems, including putting more resources toward finding these problems and terminating relations with at least 2 of these suppliers.
Now, a shocking report released by a collection of Chinese environmental and human right groups, titled “The Other Side of Apple” reveals even more controversy. The report was published on January 20, 2011 in Beijing by three civil society organizations – the Institute of Public and Environmental Affairs (IPE), Friends of Nature and Green Beagle. The groups investigated working conditions at several tech manufacturers. Included in the report was a ranking of transparency levels at 29 technology companies, Apple came in last place. Once again we see this issue come up. I have previously discussed this “culture of secrecy" at Apple in an earlier blog post. Greenpeace has ranked Apple low on environmental issues largely due to “their lack of transparency.” This report once again leads us to question whether the company is as green as it promotes in the media…or a little rotten at its core.
In the report, Apple is accused of "ignoring hazardous and unhealthy conditions at the factories in China where its components are assembled." The report lists 10 incidents that, according to the authors, show Apple’s suppliers have violated occupational health commitments, environmental-pollution commitments and promises to ensure workers are treated with respect and enjoy dignity. The suppliers in question are scattered across cities including Suzhou, Guangzhou and Dongguan. And the incidents include: the suicides of 12 employees at a Foxconn factory in Shenzhen, cases of n-hexane poisoning, a poisonous chemical used for production of iPhone and iPad screens that has caused workers to be hospitalized due to nerve damage, at Wintek Corp (a partner supplier for Apple in China), and numerous instances where emissions standards have been exceeded by subsidiaries of glass manufacturer CSG Holding Company. Even though in their reports Apple claims to be progressive and transparent they have not been willing to answer questions when it comes to criticism of their operations.
We have to be watchful of manufacturing being so aggressively imported overseas. This not only takes jobs away here, but working conditions in other countries that are “legal” may be conditions that we consider unethical and even illegal, or at times questionable working conditions may just be overlooked because of the desperate need for any jobs and income in developing nations.
