For better or for worse, Apple has become the poster child for how not to manage an IT supply chain. They are a perfect target as their brand is a global super star and they have a reputation of being shamelessly secretive, a characteristic that is especially taboo when Corporate Social Responsibility is the topic of conversation. Last week Apple was the focus of the International Action Day for Sustainable IT Supply Chains put on by makeITfair and Good Electronics and where the driving slogan was “Time to bite into a Fair Apple!” and on the very same day news broke that Foxconn International Holdings Ltd. (the infamous Chinese IT manufacturer of the Apple iPhone) asked employees to sign a pledge not to commit suicide. Apple was again bombarded by bad press here, here and here. But let us not forget that Foxconn is also a key supplier for Motorola, Microsoft, Nintendo, Nokia, Sony, Amazon, Dell and others.
After 14+ employee suicides and 18 attempts in 2010, Foxconn, with pressure and guidance from Apple, hired psychological counselors, established a 24-hour care center and attached large nets to the factory buildings to prevent impulsive suicides. While such measures are arguably a step in the right direction, they do not address the root cause of the issue (a severely misaligned management system) and the suicide pledge itself is a blatant step backwards as it is simply a legal mechanism so that employees cannot sue the company. Foxconn did raise wages, three times, but their actions keep missing the point and have failed to properly address their stress-ridden workforce and various labor rights abuses.
As part of International Action Day for Sustainable IT Supply Chains, Students & Scholars Against Corporate Misbehaviour (SACOM) published a report disclosing the progress made by Foxconn one year after Apple first responded to the labor issues. Below is the summary, and it seems that not much progress has been made where it counts most. The details can be read in the report here.
It is unlikely that pressure upon Apple, FoxConn and others in the IT industry will let up any time soon as the spotlight is burning bright. Suffice to say, it is not just up to Apple to step up to the plate. In the Apple Supplier Responsibility 2011 Progress Report more than 40% of their suppliers inspected last year (127 in total) said that Apple was the first company to have audited them for social responsibility. Even without knowing the exact make up of the suppliers assessed, this figure is nonetheless very high. Having the resolve to assess and audit suppliers is only a first step, so what is everyone waiting for? There may only be one Foxconn, but the looming social, environmental or otherwise ethical risks across supply chains are unquestionably present. In moving beyond assessments, where lasting change will happen is when companies begin working with suppliers towards implementing corrective actions, actions that go beyond simple defensive measures, actions that help to embed corporate social responsibility into supplier management systems.