Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 1)

Photo credit: Int'l Business Times

Apple is the Bill Clinton of the high tech industry. On one hand, the bigger-than-life tech giant is put on a pedestal of excellence; a representative example of what is possible when innovation and supply chain brilliance come together (for both customers and shareholders). But on the other, Apple has been accused of having deep character flaws hidden behind closed supplier doors for tolerating certain behaviors amongst its suppliers, turning a semi-blind (squinting) eye away from problems it should have surfaced long ago. Unfortunately, there is no better half to Apple, unlike Bill, so we must evaluate it in a vacuum. Yet like Bill, Apple is willing — at least in part — to own up to some of its faults and address them. However, whether its actions end up further polluting the supply chain or truly changing behaviors is the question that we all want answered.
Apple’s 2012 Supplier Responsibilityreport suggest that they might be taking a step in the permanent right direction — becoming “organic” and “sustainable,” to borrow two buzzwords if you will, rather than addressing toxic supplier behaviors with a similar near-sighted response. In a series of posts highlighting some of the findings from Apple’s recent supplier auditing programs plus our perspective on what Apple could be doing in addition to its current efforts, setting a broader example for the industry, we’ll hope to get to the bottom of a topic that has only been superficially covered in the mainstream press. Above all, our goal in looking at Apple’s latest CSR findings in this multi-part series is to surface the most salient points and analysis which other procurement organizations (inside and outside of high-tech) can leverage in their own CSR initiatives, especially in a global sourcing context.

Today, we’ll start with just a few highlights from the report before digging into some of the specific sections and nuances we find most telling. Unfortunately, even though Apple has disclosed quite a bit in the report, we’re left in the dark around specific supplier findings and activities on a year-over-year basis. But on a high-level, the news appears good. Apple’s audits in 2011 represented an over “80% increase” from 2010 levels. And “more than 100 of these were at factories that we had not audited before,” according to Apple. Moreover, it appears that initial auditing investments do result in better behavior in the following years. To wit, “facilities where we conduct repeat audits consistently show fewer violations, and the vast majority improve their audit scores year-over-year.”

Yet the most important question here is whether, like Bubba, Apple is making up for its flaws with its public image strengths or fundamentally changing its tune when it comes to engaging suppliers with both carrots and sticks. Stay tuned.

Read this and other articles @ Spend Matters

Obsessed with how companies manage, spend and save money, Jason writes about procurement, trade and supply chain issues @ Spend Matters. He has significant first hand experience developing and marketing technology and services products, has advised numerous companies on sourcing and related techniques as well as M&A pursuits.  In previous lives before tech, he was a management consultant and merchant banking analyst.
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