For several years, we have been extolling the importance of Labor and Human Rights violations as a critical component of sustainable supply chains. In a previous post, we also identified a number of companies identified as the “best” in our list. Apple was one of the companies on our list! We also discovered that the highest ranked components of sustainability include:
– Code of conduct – availability
– Internal evaluation
– Code of conduct – penalties
The lowest ranked attributes included:
– Evaluation of second tier suppliers
– Independent evaluation of criteria
– Supplier enforcements – codes of conduct
– Independent evaluations of reporting
– Use of code of conduct language in contracts
In my blog, I emphasized that companies are often “making a public show” of their sustainable efforts, but in many cases truly doing little to enforce it in the industry.
Apple released a recent report on the sustainability of their Asian contracting operations.Apple_SR_2012_Progress_Report This report clearly supports many of our earlier contentions. The first element of our assessment was whether a code of conduct is applied. The report states that Apple’s goal is that every supplier complies with their Code. “We perform a verification audit to confirm that actions have been resolved, and we collaborate with the supplier until issues are fully addressed. However, if a supplier’s actions do not meet our demands, Apple will terminate the business relationship.”
But how can Apple (or any company for that matter) truly determine whether the issue has been addressed? This is where it gets tricky. Only 73% of suppliers were compliant with the conditions in the code. Elements such as discrimination of workers, excessive overtime, payment violations, unlawful deductions of pay, lack of overtime, use of underage workers, and other violations are difficult to track in an audit. This doesn’t even include environmental violations, and worker safety (such as combustible dust).
One of the important elements we use to rate companies on their environmental and labor human rights record is TRANSPARENCY. That is to say, the first step is to admit there are problems, and to expose the problems. To end labor and human right violations, companies like Apple will need to work with local governments, local communities, and work to publicize violations they find in their own supply chain. For that they should be commended. Now let’s see how others in the electronics and other industries will do the same.