Global Business Environment Challenges

Apple’s Code of Conduct for Suppliers

Apple takes seriously its code of behavior. The corporation wants to make sure that the production and distribution of its products are done in an ethical way. To be able to oversee the production process and ensure that the workers are treated fairly, Apple evaluates its code of conduct and conducts thorough audits in-person (Suppliers Responsibility, 2017). Apple made certain revisions to the code of conduct for the business. Because it wanted to ensure that the products reached consumers through the proper channels, the corporation considered this as important. Suppliers who violate the company’s code run the danger of losing their commercial connections as well as their rights to produce and sell products. Apple aims at delivering a complete package. It wants to its products made in a safe environment and up to the standard of the company. Lastly, the company wants to make sure that the suppliers ethically treat their workers.

Supplier Audits and Risk Assessment

Apple usually conducts a risk assessment before making the decisions of contracting with any supplier. The company does not just extend such privileges to anyone. The supplier must meet some level of standards. Apple decided to assess its suppliers because of past incidences when the company was scrutinized because of the way its suppliers were handling their employees with some of them being underage and getting low wages as well as incidences of forced labor (Moren, 2014). In the year 2014, the company did an audit for 459 of its suppliers before any productions (Suppliers Responsibility, 2017). The company has many audits scheduled because it wants to make sure that the products are of the required standards about manufacturing and supply. The audits also cover the working conditions and qualifications of the employees. These supplier audits enable apple to remain compliant and sort any recurring issues.

Actions Taken to Address Violations

Secondly, every audit usually reveals specific violations which are on a rating system. The core violations need immediate action to prevent the reoccurrence of that breach (Lepelt, 2013). All the violations which took place over the supplier audit created the opportunity for the company to become more ethical and efficient in its operations. Fighting employment of the under-age staff was one of these violations which needed immediate correction because it is unlawful to recruit children who are supposed to be schooling (Suppliers Responsibility, 2017). Therefore, Apple had to pull these children from the supplier’s workforce and enroll them in school, paying all their tuition fee which shows how this issue is of great significance to apple. Additionally, the audits revealed that some of the employees were working overtime and getting low pay when Apple had paid money to cater for wages. Therefore, the company introduced a new rule stating that employees could only work for 60 hours every week. Doing this was effective in avoiding forced labor and ensured that employees working overtime entitles one to overtime pay.

Education and Training Initiatives

Apple believed that knowledge and education was the key to eliminating all the violations found in the course of the audits. Therefore, Apple has since reeducated 2.3 million employees and retrained them on the company’s code of conduct as well as Apple’s rules and regulations (Suppliers Responsibility, 2017). The company takes the education part of its foundation earnestly and has had 861,000 employees since 2008 take courses for their personal growth as well as college degrees through Apple’s foundation. The company has all these revisions and programs in its code of conduct because it wants the suppliers to be serious about this issue. Suppliers are to account for failing to follow the given code of conduct. Those who do not abide by this risk being closed out of production.

Focus on Health, Safety, and Environment

Health and safety are of extreme importance to Apple. The company has introduced over 870 EHS academy projects to facilitate training of midlevel managers on health and safety. Apple believes that training the managers will contribute to safer work environments. Therefore, educating on chemical management, ergonomics, and fire safety were introduced to the EHS academy and by the year 2014, 73 students graduated (Suppliers Responsibility, 2017). Both the suppliers and their employees are supposed to undertake these training to increase their awareness of health regulations of the company as recommended by the employment laws (Lepelt, 2013). This move translates to work environments which are safe for the employees. The other positive outcome of the EHS Academy is the optimistic attitude of the students who have been through the academy. Therefore, this proves Apple’s point that education and knowledge are essential in improving the services of the suppliers.

Environmental Responsibility

Regarding the environment, Apple works towards making sure that it does more than the legal requirements. Apple has a clean water project that aims at conserving water. The company wants to make sure that it is not missing the resources of the local community in its production process. The water project covers 50% of Apple’s suppliers (Suppliers Responsibility, 2017). So far, the company has terminated the contracts for 13 of its suppliers for not following this code and wasting the resource at their disposal. Ending contracts with these suppliers saved Apple about half billion fresh water gallons. The operations vice president made it clear to the suppliers that the company is serious about the issue of water conservation and any supplier who goes against the code will face serious consequences. The company employed more environmental managers to help with ruing of the facilities.

Conclusion

In conclusion, a look at Apple suppliers’ code of conduct shows the seriousness with which the company takes issues that keep recurring within the factories. The company can keep itself informed of its supplier’s activities through the audits. Apple has introduced projects over the years which are in line with its code of conduct, and this guarantees that the suppliers will comply and employees will get fair treatment. Apple is aware of the other pending issues, however, with the scheduled audits and education the company will stay updated and improve the supplier’s services. The company takes all the violations seriously. It has come up with new ways of communicating with its suppliers and guarantee the fair compensation of the employees for their efforts as well as their safety. The company has also been able to stay ahead of the competition by being aware of the environment. Apple wants to make sure that it operates in an ethical environment and that its decisions and operations contribute to a better environment. Thus, Apple’s objective is to continue auditing its suppliers to make sure that the suppliers are improving their efficiency and the employees are getting fair treatment.

References

Suppliers Responsibility. (2017). Progress Report. Retrieved From https://images.apple.com/supplier-responsibility/pdf/Apple-Progress-Report-2017.pdf

Lepelt, T. (2013). Corporate Social Responsibility in Buyer-Supplier Relationships: Is it

Beneficial for Top-Tier Suppliers to Market their Capability to Ensure a Responsible Supply Chain? Supply Journal, 6 (2), pp.126-152.

Moren, D. (2014). Apple’s 2014 supplier report: Better working conditions, fewer conflict minerals. Retrieved from http://www.macworld.com/article/2097723/apples-2014-supplier-report-better-working-conditions-fewer-conflict-minerals.html