Essay: Apple Corporation and Ethics

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[. . .] But instead of taking stock of its available resources to at least reduce the already exposed and publicized abusive management practices in its supply chain, Apple chose to minimize the cost of its business practices, which even pressure suppliers to resort to cutting corners in production. The intricate designs and very high demand for iPhones in addition to low margins compels Apple suppliers to compete with one another. They in turn compel workers to work overtime and, in so doing, engage or expose themselves in unsafe production practice as well as employ underage people to work. Foxconn's new quality control standards for iPhone 5 in October 2012 required greater precision levels, which increased the number of abuses in Apple suppliers' factories. As a result, their workers went on strike to protest the extreme working conditions imposed and the compulsory work during the Chinese Golden Week holiday. This occurred in spite of Foxconn's fresh promise of improving compliance to Chinese labor laws as well as Apple's Supplier Code of Conduct. This pledge was made just after the FLA's audits discovered violations in Foxconn's factories. Despite the efforts exerted by Apple and its suppliers to ameliorate harsh labor conditions, its seemingly unlimited profit maximizing policies consider the elimination of workplace abuses only a second concern. This thus explains the continued abuses and sufferings of its factory workers (Myers).

V. Two Actions to Improve Global Competitive Advantage

One is to exert real efforts at ridding its supply chain free of workplace abuses not only to improve working conditions in its factories (Myers, 2012). This would also set an example to many of Apple's giant consumer electronic competitors to observe the practice. Apple can do so by increasing funding for improving work environment, offer financial incentives to suppliers by shifting supply chain with preference to those with better records in observing labor laws, and reducing demand from each supplier so as to correspondingly reduce the pressure currently imposed on them to cut corners on production. An anonymous Apple executive commented that this task should not be difficult at all for Apple considering its excellent performance and huge available resources (Myers).

Another is to maintain its outsourcing operations while improving workers' conditions in supplier factories. A lot of its manufacturing tasks are performed overseas, specifically in 600 manufacturing locations in Asia, 331 of which are in mainland China (Myers, 2012). Outsourcing of manufacturing, at least for Apple, has reduced labor costs. Suppliers have established access to the huge Chinese supply chain in assembling the company's products. This has been particularly important to reducing production cost. Assembling iPhone alone has reduced the cost for each unit to 47% less than what it would cost them if assembled in the United States (Myers).

Reduced costs were not the only advantage that outsourcing has brought to Apple (Myers, 2012). It also rewarded them great flexibility in the production process. Its major partners like Asustek and Foxconn assemble iPhones in dormitories located on factory grounds. This proximity or set up allows an almost immediate use of thousands of workers and their speedy adjustments of assembly line products. Their established relationship with these contracted workers allows last-minute changes on product designs, needed changes and the production of several thousands of products each day in less than a week's notice only (Myers).

While labor rights violations are high up in the list of considerations for improving its competitiveness in the global market, Apple should keep open to the pressure placed by media and its suppliers to continue making those improvements and maintaining them. On the whole, the issue that turns up about corporate social responsibility has to do with deciding whether corporations should be solely or more strongly motivated by economic considerations than fulfilling their social and moral obligations to people under them and around them. How they should be measured and accounted for is a sub-issue. How far down the supply chain should these responsibilities go is one more consideration. There are those who believe that corporations like Apple should establish and faithfully follow a strict set of standards, which will protect the rights of those who work for them. Others, on the other hand, argue that non-corporate bodies, such as government entities, international institutions and unions should initiate and lead the implementation of labor reforms and oversight of these. Corporations more and more in recent years feel the pressure of taking responsibility for the behavior of their partners overseas. Many hope that this trend should continue until workplace abuses around the world are eliminated (Myers).

Apple Corporation and other multinational corporations must determine the extent of their responsibility in insuring the respect of workers' rights (Myers, 2012). Under the current system where the stakeholders are spread out globally, there are no clearly set standards. Corporations, subcontractors, governments, NGOs and individual workers follow different rules or systems. Yet actions must be taken when basic human rights are violated. Multinationals like Apple Corporation are becoming more and more aware of the painful and troublesome consequences of exploiting cheap labor and fostering sweatshop conditions through outsourcing, there remains a great lack of some widely accepted or acceptable and clearly defined set of global standards for appropriate corporate citizenship for everyone to follow and to control everyone. Without these standards, these corporations will tend to take risks they see fit in the primary pursuit of making and maximizing profit (Myers).

BIBLIOGRAPHY

Apple (2014). Apple, Inc.. Retrieved on February 23, 2014 from http://www.apple.com

- (2006). Apple supplier code of conduct. Apple.com. Retrieved on February 23, 2014

from http://www.apple.com/.../Apple_Supplier_Code_of_Conduct.pdf

Forbes (2014). Apple at a glance. Retrieved on February 24, 2014 from http://forbes.com/companies/apple

Myers, C.(2012). Corporate social responsibility in the consumer electronics industry: a case study of Apple, Inc. Edward A. Walsh School of Foreign Service: Georgetown University.

Retrieved on February 23, 2014 from http://lwp.georgetown.edu/wp-content/uploads/Connor-Myers.pdf

Satariano, A. And Culpan, T. (2014). Apple tallies labor-rights… [END OF PREVIEW]

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