Apple Inc. is the largest information technology (IT) company in the world. With IT being one of the fastest growing industries in the world, this is a monumental feat. On the path to the achievement of such a mammoth goal, it is possible for some critical issues to be overlooked and this is clearly seen regarding the supply chain of Apple Inc. The changing market dynamics occasioned the company to outsource most of its supplies including labor. In 2006, the initial accusations began trickling reprehensible conduct by Apple Inc. suppliers (Duhigg, Greehouse, & Barboza, 2012). The company commenced efforts to stem this conduct and all seemed well until 2010 when there was a suicide attempt at Foxconn, one of Apple Inc.’s Chinese Contractors. It was until investigations showed massive abuses that Apple revised its entire supplier code of conduct and endeavored into the path of reforms. This reformation endeavor is still ongoing.
The main change in the supplier code of conduct was internal to Apple Inc. and it regarded an adoption of responsibility for the conduct of members of the company’s supply chain. This meant that the company could no longer assume that what happened to its suppliers did not fall under its ambit. Initially, Apple would only be interested in its suppliers to the extent of its supplies, but with the adoption of responsibility, Apple became a stakeholder in the affairs of its suppliers (Duhigg & Wingfield, 2012). To achieve this, Apple made its suppliers account for all their acts and omission whether they relate to the goods and services supplied to Apple or not.
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The first area of interest in the new code of conduct was labor and human rights. This followed accusations of child labor, underpayment, overwork, and poor employee housing. With most manufacturing of Apple’s gadgets being done in factories in China, it was necessary for Apple to superintend the relationship between the Chinese contractors and their members of staff. According to the new code of conduct, the fundamental human rights for all employees must be adhered to and issues such as inhumane living conditions and corporal punishment, which are common in rural Chinese factories, were banned. Further, proper labor relations procedures as provided for by the international organization (ILO) must be adhered to by all suppliers (Duhigg, Greehouse, & Barboza, 2012).
From the perspective of Apple’s suppliers, it denotes careful studying and adherence of international human rights and labor rights with a bias to the US where Apple has its headquarters. It is no longer possible to hide behind local human rights and labor customs of the country where the contractor has their factories. Issues like the maximum number of hours per week, the minimum working age and the minimum wages must be adhered to. If the human rights and labor relations do not conform to international standards as aforesaid, it may lead to termination of services by Apple Inc (Duhigg, Greehouse, & Barboza, 2012).
Other than labor relations, the code of conduct also provides for employee empowerment. This denotes the improvement of the services the employee is capable of providing through in- service education. Employee empowerment through education increases the chances of promotions, pay increase, and career advancement. Further, Apple expects members of its supply chain to innovatively improve the working conditions of their employees by providing better tools (Duhigg, Greehouse, & Barboza, 2012). This is meant to make the employee work easier and the working circumstances better.
The other area of change in the code of conduct involved the health and safety of employees. Among the accusations labeled against Apple’s suppliers regarded a Chinese industry where over 200,000 employees lived in one compound. The employees’ quarters were crumpled with over 11 employees sharing a room and lying on plywood with no bedding and this created a lot of health challenges for the employees. Further, the chemical elements used in the factories adversely affected the health of the employee. With regard to safety, lack of protective gear within the factories also made part of the accusations.
To remedy these problems, all Apple suppliers must provide adequate and relatively comfortable accommodation for their employees. Further, the chemicals and other elements used must be in line with international standards to prevent adverse health effects as aforesaid and if for any reason an employee is to come into contact with harmful substances, proper protective gear must be provided for by the employer (Apple Inc., 2016).
In a factory setting however, there is always a high susceptibility for industrial accidents despite all efforts to the contrary. This was also envisaged in the changes to the code of conduct. The contractors who run factories must show that they have done anything practically possible to avoid such eventualities. Further all factories must put in place well planned and practiced contingency safety measures. Equipment for combating fires and other calamities must meet international standards (Apple Inc., 2016). Other elements of safety specific to the industries supplying Apple must also be put in place and fine-tuned.
The other change in the code of conduct involves environmental factors. IT related devices are made using elements such as heavy metals and corrosive cleaning agents which have high propensity for environmental degradation. All factory wastes must, therefore, be delicately handled to avoid adverse effects on the environment. With regard to fuels, a private environment regulator Climate Counts gave Apple 11 out of a possible 100 points for environmental friendly in 2008. Two years later, apple had improved this to 52 points and by 2012, Apple had committed to the total gradual elimination of all coal and fossil based fuels (Duhigg & Wingfield, 2012). Special mention regarding environmental factors is made to water ways around and proximal to factories. Innovative ways are encouraged to ensure that no contamination is made in all waters ways close to factories owned by Apple suppliers (Apple Inc., 2016).
In conclusion, Apple incorporates the amorphous issues of ethics in the pursuance of all the above and in all other aspects of decision making in the company. Ethics entails the incorporation of the philosophical element of morality within entrepreneurship. It calls for all entrepreneurs to augment the pursuit of profits and over heads with doing what is right and what is moral. Whereas there is no definite science towards ethical conduct, as the suppliers account to Apple for their acts and omissions, it pays for them to show the attributing ethical reasoning (Apple Inc., 2016). Under the ambit of ethics, all human beings must be treated as an end in themselves and not as a means to an end. Further, the overall conduct of the contractors must be seen to be tending towards universal good. The contractors must also adopt a culture of self-betterment.
To achieve the above changes in the code of conduct from a practical perspective, Apple has undertaken two major elements of regulation and evaluation (Duhigg & Wingfield, 2012). The first is self-regulation, which entails the sensitization and training of the contractors to develop mechanisms to test adherence to the aforesaid code of conduct through internal audit. Apple then expects the suppliers and contractors to avail the results of these audits for review by Apple’s auditors (Apple Inc., 2016).
By 2010 however, Apple realized that internal regulation was insufficient and commenced inspections and audits by Apple’s own experts (Duhigg & Wingfield, 2012). This was followed by suggestions for improvement. In extreme circumstances, Apple dropped such vital suppliers who were unwilling or incapable of compliance. This began to bear fruits and by 2012, Apple was getting applauded by international regulators for improvements emanating from its supplier code of conduct. Some regulators however, continue to criticize Apple citing cosmetic rather than actual changes, a good example thereof being the Economic Policy Institute through their article named A ssessing the reforms portrayed by apple’s supplier responsibility report . There is however, a general consensus that Apple has made great progress in streamlining its suppliers.
References
Apple Inc. (2016). Accountability - supplier responsibility . Retrieved from <https://www.apple.com/supplier-responsibility/accountability/>
Duhigg, C., & Wingfield, N. (2012, February 14). Apple asks outside group to inspect factories. The New York Times.
Duhigg, C., Greehouse, S., & Barboza, D. (2012, March 30). Electronic giant vowing reforms in China plants. New York Times.
Economic Policy Institute. (2016). Assessing the reforms portrayed by apple’s supplier responsibility report . Retrieved, from <http://www.epi.org/publication/assessing-reforms-portrayed-apples-supplier/>
