There is no question that Apple is a remarkable company. In addition to its business turnaround, its innovative design, and its media content and apps, the unadulterated sexiness of all its products makes Apple hard to resist. For me, what isn’t hard to resist, is asking: How can a company that is this extraordinary in other respects be missing in action on corporate social responsibility? Apple’s Supplier Responsibility Report reveals that the company is taking action to stop unethical practices among its suppliers. These have included use of underage labor at 10 facilities, dangerous working conditions at two facilities, falsification of audit materials at four facilities, and bribery at one facility (Forbes, 2014).
Apples Current Position on Ethics and Social Responsibility
Recently, Apple released a list of suppliers that accounts for 97% of the company’s supply chain expenses. The company also became the first technology enterprise to join the Fair Labor Association, which works to improve labor conditions and boasts such members as Nike, Adidas, and H&M. The increased transparency is welcome after a spate of bad press regarding overseas supplier Foxconn and others raised doubt about Apple’s commitment to corporate social responsibility (CSR). Apple’s public image has the rosy glow of a crisp Gala. A national survey conducted by the New York Times in November 2011 found that 56% of respondents couldn’t think of anything negative about the company, while 14% cited expense as the worst thing about Apple. A mere 2% noted overseas labor practices, but that may be changing with recent stories about appalling labor practices in some of
Apple’s suppliers in China picking up pace after the report.
The new year ushered in a provocative radio report titled “Mr. Daisey and the Apple Factory” from “This American Life,” detailing awful living and working conditions for people at Apple. Suppliers like Foxconn note that “This American Life” has since retracted parts of the story, claiming that Mike Daisey “embellished” portions of his tale, although the radio show acknowledges that the overall problematic conditions at various Chinese manufacturing plants are well documented elsewhere. Soon after, the New York Times followed with an article titled “In China, Human Costs Are Built Into an iPad,” highlighting similar depressing working conditions at iPad and iPhone factories. The most e-mailed article of the day, it detailed deaths from explosions caused by aluminum dust, n-hexane poisoning caused by screen cleaner, suicide attempts, underage workers, and workweeks of more than 60 hours.
Finally, reports came in about a potential mass suicide by 150 Foxconn workers, who threatened to jump from the factory roof. While the crisis was averted, it followed 18 deaths from “falling” at the plant in 2010 Examine Apple’s Core: Will CSR Prevail? (2012). Business & the Environment, 23(3), 7-8. Apple has had many CSR challenges; over the years; however, Apple has worked to strengthen its programs to help suppliers protect student interns and other at-risk workers. Apple continues to ensure efforts to end excessive work hours. In 2013, Apples suppliers achieved an average of 97 percent compliance with maximum 60-hour workweek. Apple is driving responsible sourcing of minerals, and has publicly released a list of smelters and refiners to its supply chain to promote transparency. In June 2013, Apple’s work hour compliance was 100% the current June 2014 compliance is down slightly to 95%.
Apple states that if companies want to do business with Apple, they must uphold the highest commitment to human rights. Apple also states it is looking to eradicate unethical hiring and exploration of workers even when local law suites permit such efforts. Apple is continuing efforts to end excessive work hours and driving sourcing of tin tantalum, tungsten and gold
Apple’s 2014 report shows Apple has met its social responsibilities. Apple conducted 33 specialized audits at facilities employing migrant workers who may be at risk for unfair treatment. Apple required suppliers to reimburse US$3.9 million in excess foreign contract worker fees, it was confirmed, in January, 2014 that all active third-party auditors verified identified tantalum smelters in Apple’s supply chain as conflict-free (Forbs, 2014). Apple’s position on climate change is also a work in progress. Apple is working to improve its position in the world on climate change. Apple says it wants to leave the world better than they found it. Apple strives to create products that are the best they can be in every way. Products that is beautiful, easy to use and powerful. Apples passion for innovation goes into to how Apple thinks about its social responsibility of being environmentally responsible.
Apple works tireless on reducing its impact on climate change by finding ways to use greener materials, and conserve the resources we all need to thrive. The Impact of Publications of Ethics and Social Responsibility on Apples Reputation Apple’s reputation was challenged by the impact of the publications of ethics and social responsibility violations made by suppliers. Like every company, Apple faces five types of external pressures that influence its strategies and operational policies: customer loyalty; industry best practices; expectations of major shareholders and the investment community; civil society organizations or NGOs; and, increased government pressure and regulatory oversight.
Despite extensive media publications on the impact of the ethics and social responsibilities violations made by Apple’s suppliers, Apple’s reputation has not suffered. There has not been any loss in demand for its products or revenues, which continues to grow unabated. Apple also enjoys broad customer loyalty in China even though customers there have a better knowledge of these working conditions. This is not surprising. Product boycotts are usually very short-lived, except those for products that pose a threat to consumers’ health and safety, such as contaminated food products. Public pressures and media coverage also decline when the issue ceases to be a news event and other more newsworthy items catch media attention. It is highly doubtful that it will be any different this time Two Faces of Apple PRAKASH SETHI APRIL 2012.
In sum, Apple’s business model is no different than its competitors. Yet as an industry leader, it surely has the ability, and I contend the obligation, to set standards of conduct that enrich the “commons” at the same time as it enriches the company’s investors. Methods Apple Can Utilize To Ensure Wages And Benefits Standards Going forward, Apple can make sure that its suppliers adhere to wage and benefits standards by giving employees a voice and direct connections to its corporate CEO with surveys and frequent meetings either virtual or face – to – face for comments regarding treatment and fair wages. A taskforce can be established to mentor workers, keep in touch and understand what is needed. There are often problems of communication and the taskforce could improve this gap between Apple and its employees, thus creating satisfied workers and less scrutiny and unwanted media publications for Apple.
Apple’s Customers and Increased Cost
Apple’s customer satisfaction is stellar in light of all of the negative media publications. In addition, Apple’s customer base is loyal. Pundits often refer to them as “zealots” or “fanboys.” The more polite references include “Mac loyalists.” I am, of course, talking about Apple’s (AAPL) more vocal customers, those who will defend the company and its products in any debate going on around them. The Secret Behind Apple’s Loyal Customer Base Apr. 11, 2007 9:32 AM ET| About: Apple Inc. (AAPL) By Carl Howe Notably, I believe Apple’s customers will pay an increased price to own one of Apples products and stand in overwhelmingly long lines to purchase them. Apples customers would be willing to pay more to keep the most innovative product in the industry if there was a price increase due to Apple needing to pay higher wages to employees to produce an Apple product.
What is it that drives their passion for most things Apple? Is it a deluded mind warped by the Reality Distortion Field that Steve Jobs so successfully wraps every new product in? In short, the answer is no. The truth behind the scenes is not that Apple has a large group of customers that are too dedicated and passionate about their products, or the company as a whole. The reality is far more simple and obvious: Apple simply has a large group of very satisfied customers — and that’s the secret ingredient, left out of nearly every analysis or op-ed piece that mentions these “zealots.”
The obvious side to Apple’s customer satisfaction lies in their attention to detail in every facet of product development. All their products are designed, at every stage, with the customer clearly in mind and each product is tailored to make it as easy to use as possible for the customer, regardless of how technically savvy or not they may be. The less obvious side involves two keywords: freedom and choice. Customers do not really want freedom of choice they want satisfaction in the product they purchase this is what keeps customers satisfied and loyal.
Apples Current Overall Marketing Strategy
Apple’s current overall market strategy is excellent for developing a very distinct strategy through industry leading innovation. This strategy has allowed them to be the frontrunners in new product introductions and the improvement of existing products. Apple has employed a differentiation strategy in an attempt to meet the needs of a global market by offering customers innovative new products and improved existing products. An important part of their strategy involves meeting the needs of the evolving digital electronics and computer markets. Apple has chosen to implement its strategy by designing and developing its own operating systems and software technologies. This has allowed them to be very flexible in developing new products as they have complete control over the software and hardware.
Apple’s strategy is still evolving in an effort to keep up with evolving technology. Initially, Apple sole focus was on the computer industry as they were introducing innovative products. Apple continues to introduce innovative products in the computer industry, but recently has focused a great deal of strategic attention and resources on entering into the digital electronics and computer markets. This, along with the successful entry into the personal media player industry, marks a clear evolution in Apple’s strategy. Also, Apple’s entry into the tablet computer industry with its iPad and the mobile phone industry with its iPhone are evidence of a further evolving strategy. (2012, 02)What Are the Chief Elements of Apple’s Overall Competitive Strategy? Study Mode.com. Retrieve 02, 2012 from htt1://www.studymode.com/essays/What-Are-The-Chief-Elements-Of-928263.html
Examine Apple’s Core: Will CSR Prevail? (2012). Business & the Environment, 23(3), 7-8.
Lisa Jackson Vice President of Environmental Initiatives www.insidebusiness360.com › Management › Management Ethics
Two Faces of Apple PRAKASH SETHI APRIL, 2012
The Secret Behind Apple’s Loyal Customer Base Apr. 11, 2007 9:32 AM ET| About: Apple Inc. (AAPL) By Carl Howe
(2012, 02)What Are the Chief Elements of Apple’s Overall Competitive Strategy? Study Mode.com. Retrieve 02, 2012 from htt1://www.studymode.com/essays/What-Are-The-Chief-Elements-Of-928263.html