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Challenges in the Business Environment Essay

There has been no change to Apple Code of Conduct policy since 2014 when Apple started taking previous audit scores into consideration and conduct detailed risk assessments with suppliers who had not been audited in the past before awarding the new business. In 2014, we reviewed 459 suppliers, and factored their responsibility performance into our decisions. This engagement has allowed Apple to address over 700 findings related to labor standards, worker safety, permits, environmental hazards, and chemical management before production began (Apple – 2014 Supplier Code of Conduct). Apple has made significant progress, gaps still exist, and there is more work to do. Apple knows that workers are counting on them and they will not stop until every person in their supply chain is treated with the respect and dignity they deserve (Apple – Supplier Responsibility 2015 Progress Report). Apple believes that it is not enough to just set high standards they must work every day to make sure they’re upheld. Apple Supplier Code of Conduct is among the toughest in the industry.

To track working conditions at suppliers’ facilities, we conduct regular, in-person audits deep into the supply chain. Audits remain essential to Apple work, but they’re only the beginning. Apple reports monthly on working hours for over one million workers with hopes that their openness will inspire other companies. But more important, Apple believe the feedback that transparency invites makes us even better (Apple – Supplier Responsibility 2015 Progress Report). Apple’s suppliers are required to provide safe working conditions, treat workers with dignity and respect, act fairly and ethically, and use environmentally responsible practices wherever they make products or perform services for Apple. Apple requires its suppliers to operate in accordance with the principles in this Apple Supplier Code of Conduct (“Code”) and in full compliance with all applicable laws and regulations.

This Code goes beyond mere compliance with the law by drawing upon internationally recognized standards to advance social and environmental responsibility. This Code outlines Apple’s expectations for Supplier conduct regarding labor and human rights, health and safety, environmental protection, ethics, and management practices. Apple assesses its suppliers’ compliance with this Code, and any violations of this Code may jeopardize the supplier’s business relationship with Apple, up to and including termination. This Code applies to Apple suppliers and their subsidiaries, affiliates, and subcontractors (each a “Supplier”) providing goods or services to Apple, or for use in or with Apple products (Apple – 2014 Supplier Code of Conduct). To show that Apple believes that it is not enough to just set high standards and that they must work every day to make sure they’re upheld. In 2014, over 2.3 million workers were trained on Apple’s Code and their rights. Apple invested millions of dollars to expand our Supplier Employee Education and Development (SEED) program since it began.

SEED now totals 48 classrooms in 23 facilities equipped with iMac computers, iPad devices, education software, video conferencing systems, and more. To make sure the standards were upheld Apple performed 633 audits covering over 1.6 million workers in 2014. Apple also audited suppliers in 19 countries and calls were made to 30,000 workers to make sure their rights were being upheld (Apple – 2014 Supplier Code of Conduct). Apple Suppliers Understanding of Their Standards, Responsibilities, and Company Relationship Apple is proud of the strong relationships they have built with their suppliers, many of whom have been working with them for years. Apple periodically reviews their relationships and adds new suppliers as needed. Apple requires each of its suppliers to meet the highest standards for all goods and services. Our requirements include a commitment to rigorous quality assurance. In addition, suppliers must be committed, as we are, to ensuring the highest standards of social responsibility. The ideal suppliers are those who understand our culture and expectations.

We value suppliers who take the time to learn about and understand our business and who look for ways to add value. These suppliers know the importance of making and meeting commitments and delivering the highest quality goods and services (Apple – Apple and Procurement). Apple business environment is competitive and fast-paced. Apple suppliers must understand this dynamic and be agile and flexible in responding to changing business conditions. All over the world, people are building Apple products and Apple has a responsibility to make sure that each person is treated with dignity and respect. It’s a massive challenge where Apple work is never done, but each year they implement meaningful, lasting changes across their supply chain. Because of this around the globe, Apple employees are united in bringing equality, human rights, and respect for the environment to the deepest layers of their supply chain.

Apple goes deep into their supply chain to enforce their social and environmental standards by empowering workers through education, demanding that suppliers treat workers fairly and ethically at all times, having safe and healthy facilities, and hold their products and processes to the highest environmental standards (Apple – Supplier Responsibility 2015 Progress Report). Apple believes that in order to make impactful changes across their supply chain, it’s important to understand firsthand what’s happening inside their suppliers’ facilities. That’s why they don’t simply employ and review audits from behind a desk in Cupertino. Instead, they directly gauge how their supplier facilities are doing by regularly visiting and partnering with their suppliers around the world, so when they discover a problem, they can work together to get it fixed (Apple – Accountability). To make sure the standards are understood and upheld Apple performed 633 audits covering over 1.6 million workers. Apple also audited suppliers in 19 countries and calls 30,000 workers to make sure their rights are being upheld.

Every audit is led by an Apple auditor and supported by local third-party auditors. These third parties are experts in their fields and all have been trained to use our detailed auditing protocols. During each audit, Apple grade suppliers on more than 100 data points corresponding to each category of our Supplier Code of Conduct (Apple – Accountability). Apple auditors are highly skilled at identifying when suppliers are covering up information. Apple audits are proven to improve supplier compliance. Each year we review and raise our already strict requirements, and suppliers continue to meet our increasingly stringent standards. In 2014, facilities audited two times scored 25 percent higher than those facilities with first-time audits. Facilities audited three times or more scored 31 percent higher than facilities audited for the first time (Apple – Accountability). In addition to these regular, prescheduled audits, Apple randomly select facilities to audit unannounced.

These surprise audits help ensure that our suppliers continue to meet our standards at all times not just during scheduled visits. Apple conducted 40 surprise audits in 2014, where their team visited suppliers on the spot and inspected the facility within hours. After the audit Apple conducts physical inspections, reviews documents, and interviews workers in their native languages, without their managers present. Afterward, workers are given a phone number, so they have the opportunity to securely and confidentially provide additional feedback about a facility to our team, including anything they consider to be unethical behavior. Apple encourages workers to report any retaliation to us, and we follow up with all suppliers to address each reported issue (Apple – Accountability). Inclusion these audits, code of conduct, and standards give Apple suppliers the understanding of what it means to be part of the company.

Apple – Accountability. (2015, January 1). Retrieved March 7, 2015, from http://www.apple.com/supplier-responsibility/accountability/ Apple – Apple and Procurement. (2015, January 1). Retrieved March 7, 2015, from http://www.apple.com/procurement/ Apple – 2014 Supplier Code of Conduct. (2014, January). Retrieved March 3, 2015 from https://www.apple.com/ca/supplierresponsibility/pdf/Apple_Supplier_Code_of_Conduct.pdf Apple – Supplier Responsibility Progress Report. (2015, January). Retrieved March 3, 2015 from https://www.apple.com/supplierresponsibility/pdf/Apple_Progress_Report_2015.pdf

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