Whoever said one bad apple spoils the bunch?

Rotten Apple

Announcements were made recently that technology industry leaders Apple are falling behind in terms of international sales, after Samsung overtook the brand with a £3.4bn global profit. Apple made a £2.1bn profit in the first quarter of this year, which means their market share has decreased by 3%. Aside from all the number crunching, it seems this is not the only thing Apple need to be mindful of. Stop The Traffik have been less concerned with ‘Apple’s turnover’ and more interested in how they increase their profile as an ethical brand by preventing human trafficking…

Apple became the first technology company to join the Fair Labour Association (FLA) in 2012. Interestingly, the Fair Labour Association held both Apple and Samsung under scrutiny last year for their dealings with electronics supplier Foxxcon, who allegedly facilitated cases of forced labour and excessive working hours. Most recently, Apple have also come under fire for holding contracts with Taiwanese manufacturers Pegatron, following breaches of several ethical and human rights violations. Chinese Labour Watch recently undertook investigations to discover that a portion of employees were subject to underage labour, insufficient wages and again, long hours of work.

So what efforts have been made to prevent occurrences such as these? Samsung have demonstrated their approach in their sustainability report:

-In September 2012, 249 audits were undertaken in China to inspect their major suppliers and no workers under the age of 16 were found. Recommendations for improvement have been made by China Labour Watch to increase third-party audits, which will increase impartiality and independence.

Auditors also, observed irregularities such as overtime work beyond the legal limits, failures to deliver employment contracts to workers.

-A compliance management team have been set up to monitor international and domestic suppliers to ensure they are complying with Samsung’s guidelines.

-On-site inspections were carried out in 105 of its suppliers in China, in an investigation that covered more than 65,000 employees as a result of the Foxxcon allegations.

Apple are also competing to be the best in the sustainability arena, having publicly stated:

“We’re going deeper into the supply chain than any other company we know of, and we’re reporting at a level of detail that is unparalleled in our industry”

This self-proclamation, extracted from Apple’s sustainability Progress Report released this year, communicates their dedication to issues such as underage labour, responsible supplying and their ethical accountability. But how effectively have Apple managed to tackle the following:

Ending Excessive Hours In April 2013, Apple suppliers achieved an average of 92% compliance with the maximum 60-hour workweek across all employees they track. Despite this, the national Chinese law states that the legal limit is 40 hours per week. Apple have stated that this is something they are continuously trying to reduce, but they will need to work harder to eliminate cases such as those found in Pegatron.

-Stopping excessive labour and Debt bondage: In cases where this has occurred Apple have reimbursed a total of US$1f3.1 million to contract workers since 2008, including US$6.4 million in 2012. In addition to this, they conducted 27 targeted bonded labor audits to protect workers from excessive recruitment fees.

– Dishonest third parties: Business relations were ended with one of their main suppliers in China after auditors discovered 74 cases of workers under age 16. This could be rectified by publishing the names of the factories on their website for ultimate transparency.

It often occurs that companies release a Social Responsibility report on an annual basis and do not act upon it during the interim following its release. It seems that Apple have fallen into this pattern, following the recent Pegatron scandal. Although Apple have provided consumers with figures over a significant period of time, it is important that their work on the ground is far-reaching and supports the data they release to the public. They have held the reigning title in technology for as long as we have known that Apples can make phone calls and churn out music. Profits may be falling and their ethical crown may need a re-polish. Nevertheless, if they continue to be transparent and take adequate corrective measures, they may be able to regain the trust of the ethical consumer and boost those sales.

Useful links:

Apple sustainability report

http://images.apple.com/supplierresponsibility/pdf/Apple_SR_2013_Progress_Report.pdf

Samsung Sustainability Report 2013:

http://www.samsung.com/uk/aboutsamsung/citizenship/download/2013_Sustainability_Report.pdf

 Samsung Child labour allegations:

http://www.guardian.co.uk/environment/2013/apr/25/samsung-tin-mines-indonesia-child-labour

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