We at Apple believe everyone carries social responsibility; we must do our part to ensure other’s receive fair treatment. That is why our company has implemented such powerful supplier policies. Not only are we committed to providing opportunities for our employees, we expect our business partners to share the same values.
Apple’s code of conduct is among the strictest in the world, a trait that is not only because were one of the first businesses to begin focusing on human rights violations in third world countries. Apple maintains a large supply chain, with business being conducted in over 20 countries and affecting over 1.6 million people. For a country as large as Apple (“Supplier Responsibility”, 2016), one would think it difficult to be able to affect the policies of so many outside corporations; indeed, it is because of their size that they are able to have such power over external companies. The company’s swing towards social activism occurred after 2012, when Apple was facing fierce criticism because of its supplier’s inhumane treatment of its employees (Foley, 2012). Unfortunately, we simply were unaware of the problem. The situation was horrible in China, where the Independent reports that thousands lived in crowded conditions and were frequently injured in accidents. Most disturbing is the number of suicides by workers during this time period. These factors contributed to a large change in public opinion towards Apple. In keeping with its goal of ensuring a high quality of life worldwide, it became apparent that Apple had to change its policies to reflect our core values. Our reports during the last few years show that the situation has increased substantially, and workers everywhere enjoy a higher standard of living.
Apple requires several key standards to be enforced. The company requires that its suppliers do not discriminate based on age, sex, color, etc. They also do not allow external companies to conduct pregnancy tests (“Supplier Responsibility”, 2016), unless authorized or required by law. Suppliers are not allowed to harass their employees, hire underage laborers, or have a regular work week extended past 60 hours, including overtime. According to Apple, their suppliers are also required to ensure that third party agencies that help hire employees are not furthering human trafficking. Apple’s actions here are significant as the areas with the highest volume of human trafficking are in the regions Apple regularly buys from, and we want to ensure that all laborers are there by their own choice. We also believe in educating all workers, and have incorporated numerous programs to do so. Since 2007, we have required all workers be educated about our Code of Conduct, and as of 2013 3.8 million workers had gone through the program. Our Supplier Employee Education and Development (SEED) program has continued to expand, where workers take free courses in design, English, computer skills, and more. The SEED program is part of our commitment to workers around the world. We are also proud of the Rural Education Action Program (REAP), where we partnered with several large companies to develop a university credential program in China. We increased our intern rate, and decreased the dropout rate in several universities.
Suppliers are required to provide wages in accordance with the local government’s laws, and to provide vacation time. Suppliers cannot stop workers from joining outside organizations, and they must provide workers with ways to address their grievances, either in person or anonymously. Apple also imposes safety controls, but does not specify the exact methods that its suppliers must implement to ensure the standards are met. Suppliers must also allow workers to implement safety committees, and to post safety information throughout the workplace.
Apple maintains a commitment to the environment, even with their suppliers. They require companies to regulate air pollution, water pollution, and even noise pollution. This has had a considerable impact in heavily industrialized, but unregulated economies, like China. In 2015, 93% of Apple’s energy came from renewable resources, a fact we are proud of and something we seek to see increased in our supplying companies. In 2014 we launched a Clean Water Program, partnering with thirteen suppliers to aid in water recycling. We are also growing closer with the Democratic Republic of the Congo, ensuring our mineral supply chain is environmentally friendly and the workers are kept safe. We also teamed up with the government of Indonesia and the Tin Working Group. The TWG’s investigations have caused the Indonesian government to increase safety standards for its workers, which we are happy to hear.
Our company allows its suppliers time to change their behavior before concluding their business. Apple uses external and internal audits to ensure its suppliers are complying with company policy. Since 2012, the Fair Labor Association (Foley, 2012) has investigated incidents in the area and recommended how the company could change its practices. Today, Apple has its own auditors, and contracts through third parties as well (Green, 2015). These audits increased exponentially every year since their inception, reaching a 42% increase in 2014 (“Green supply chain news: Apple increases supplier Audts by 42% in 2014,” 2009). As of 2016, we conduct roughly 640 audits per year.
The Supplier Responsibility Report of 2015 (Green, 2015) shows that Apple quit working with eighteen suppliers due to violations of their terms of conduct. Apply achieved a compliance rate of 81%, higher than previous years. While our Code of Conduct has remained unchanged, the numbers from the Responsibility Reports have increased, as our suppliers increased their compliance, furthering the rights of workers. We hope to continue this trend, and if your company is unwilling to pursue such goals, Apple may not be the best business partner.
Companies today are stretched to innovate faster than their competitors. We understand that many corporations believe that pursuing policies that are seen as inhumane are also viewed as more profitable. We want to change this outlook. Without being seen as a socially responsible company, public opinion would falter, and also drive down revenues. Therefore, we have economic reasons and moral reasons to pursue these policies. Our increase in business is passed on to our suppliers, who reap large profits from our business. Apple believes its Code of Conduct motivates other companies to pursue reasonable policies that better the standard of living for all involved. We significantly increased our standards since 2012. Progressively, we have been increasing our audits every year, and have been increasing our progress towards sustainable solutions. For this year and 2017, we are projected to increase our compliance rate among all suppliers to above 93%. We would like to thank our suppliers for continuing our joint goal towards making a positive environmental and social impact.
References:
Inc, A. (2016). “Supplier Responsibility”. Retrieved June 3, 2016, from Apple, http://www.apple.com/supplier-responsibility/
Foley, S. (2012, February 14). Apple admits it has a human rights problem. The Independent - Asia. Retrieved from http://www.independent.co.uk/news/world/asia/apple-admits-it-has-a-human-rights-problem-6898617.html
Green, W. (2015, February 14). Apple “terminated relationships” with 18 suppliers due to sustainability code violations. Retrieved June 4, 2016, from Supply Management, http://www.cips.org/supply-management/news/2015/february/apple-terminated-relationships-with-18-suppliers-due-to-sustainability-code-violations/
Green supply chain news: Apple increases supplier Audts by 42% in 2014. (2009). Retrieved June 4, 2016, from Green SCM, http://www.thegreensupplychain.com/NEWS/15-02-16-2.php
