Apple: Breaking new ground on supply chain responsibility?
Posted by on Jan 18, 2012
Apple sent waves through the international media and CSR (corporate social responsibility) communities by publishing the names of its leading suppliers in its latest Supplier Responsibility report. While information on which factories are suppliers to major brands like Apple may be an “open secret” in the industry, it was less clear how far Apple (and other brands in the same position) would go to take responsibility for those factories.
By naming its supply chain partners Apple acknowledges that it must be responsible not just for the Apple products coming from those factories, but also for their social, environmental, and regulatory records. After all, those factories are serving Apple, and exist but for the grace of their Apple order book.
It wasn’t always this clear. Years of globalisation and “advances” in shareholder capitalism have resulted in supply chains that are spread across multiple geographies and many different shareholders. Outsourcing helped firms to control risk and maximise investor returns. Conveniently, some firms misunderstood this to mean that responsibility could be outsourced too – particularly where their suppliers were far away and couldn’t be seen by home market investors and consumers.
Today that information is available in spades. Many say that Apple’s move to reclaim responsibility over its supply chain is the result of a series of high-profile exposés on employment conditions and suicides at some of its key suppliers.
Whatever the reason, Apple’s move is just one more step in a clear trend amongst major consumer brands. One could even argue that Apple is a relative latecomer. HP disclosed its supplier list as early as 2008. Nike started disclosing its supplier lists in 2005; Adidas did so soon thereafter. All three have run extensive social compliance and environmental programmes for years.
Importantly, this is not just an exercise in reporting and disclosure. Once you disclose, you have to make good on the actual and implied promises. Nike, for instance, recently had to step in to ensure that workers at one of its Indonesian suppliers received their due wages and has faced similar situations in Honduras as well. So being responsible is not just a “feel good” exercise for marketing – but has real costs and impacts as well.
So perhaps the moral of the story is that even Apple -- with such brand power and consumer cachet – can’t get by on its products and profit alone. Let that lesson be heard far and wide.
Share your views on this blog post