Much has been written over the past few days about the BBC’s exposé of Apple’s supply and assembly chain in the Far East. Many people seem to think that Apple are being picked on because only Apple came under the BBC's spotlight. I don’t think Apple are being unfairly picked on but that they’ve put themselves into this position.
The programme in question, the BBC’s current affairs spotlight programme, Panorama, was broadcast on Thursday the 18th December in the UK. For those within the UK, the programme can be streamed from the iPlayer, and for all others the programme can be found on YouTube.
The Apple way: to seek perfection
At the outset, the programme showed the rabid enthusiasm of the crowd queuing to be amongst the first to own a new iPhone, and interviews with those present extolled the virtue and perfection of an Apple product. The programme’s focus then shifted to China, to the Foxconn and Pegatron plants where Apple’s products are assembled. Over the next 50 or so minutes the programme makers showed how these companies under contract to Apple have little or no regard for employee welfare or safety. The programme makers also married each of their claims to Apple’s publicly-disclosed code of conduct which they claim to enforce at all contractors' workplaces.
To be quite fair, I don’t think there are a large number of people who will be too surprised that a large assembly plant in China is forcing people to work long days and is rushing the staff through required induction programs. However, the detractors of the programme claim that Apple has been unnecessarily and unfairly singled out as the culprit of flagrant contempt for human wellbeing.
While I do think that the programme should have made it clear that Foxconn and Pegatron do not only manufacture and assemble Apple products, there are two problems I have with the contention that Apple have been unfairly singled out.
Are Apple better than everyone else?
While Foxconn is tight-lipped about who they manufacture and assemble for, the list of clients is known to include most of the top firms in the computing/technology industry: HP, Dell, Acer… Sony's PlayStation 3, the Nintendo Wii and Amazon's Kindle Fire (source). But here’s why I think the finger should be pointed chiefly at Apple: Apple’s products carry a profit markup of around 40-45%, while the industry average is closer to a third of this. Furthermore, Apple are the richest company in the world by market cap, and one of - if not the - most influential brand in the world; they have vast cash reserves and all but a license to print iMoney.
If anyone could do anything about the human rights violations of those mining for, manufacturing and assembling their products, it’s Apple.
If Apple really cared about those people responsible for making them money, they could throw a minor percentage of their profits into benefiting the approx. 1 million people involved in the raw material production, manufacture and assembly chain.
Could, say, Acer be expected to do the same? They have a long way to catch up on Apple’s dominant position, the company’s value is far, far lower, their markup is far thinner, how could anyone expect a company in Acer’s position to take such an altruistic step?
No, it’s Apple that claims to be whiter than white, and it’s Apple that has both the means and influence to make a difference.
So my first argument to show that Apple were not unfairly picked on is that Apple have more money, power and influence than all other players, and they inspire more fervent obedience than all other players. Anyone in Apple's position should take the lead.
What Apple say is not necessarily what Apple do
It was a string of Foxconn employees' suicides in 2010 that prompted Steve Jobs to first publicly speak about what Apple were doing to support employee welfare at Apple’s contractors. Since then the issue has never been far away, which has caused a trail of comments from both Jobs and his successor, Tim Cook, along the lines of “No-one cares as much about the welfare and human rights of our workers as Apple”. I don’t recall Sony’s chief executive being quizzed about this; I don’t recall Michael Dell sitting onstage at an event such as All Things D and stating how much Dell are doing to ensure that the families of everyone involved in their supply chain were being closely monitored by his company.
I actually think Apple does one of the best jobs of any companies in our industry, and maybe in any industry, of understanding the working conditions in our supply chain. I mean, you go to this place, and, it’s a factory, but, my gosh, I mean, they’ve got restaurants and movie theatres and hospitals and swimming pools, and I mean, for a factory, it’s a pretty nice factory.
And if you’re going to make such a claim, there has to be something to back it up. What the BBC’s Panorama exposé showed was that Apple’s employee code of conduct isn’t worth the paper it's printed upon (and what a code of conduct it is – one of Apple’s stipulations is a limit of a 60-hour working week! 60 hours!). One is left with the impression that Apple are paying lip-service to the complaints while spending as little of their oceans of cash as possible on making the real problems go away.
Thus my second argument to show that Apple were not unfairly picked on is that Apple have said that they're taking the lead on this, whereas the evidence shows that their efforts do not match their claims.
Apple have responded to the BBC’s claims in a letter to staff which The Telegraph reprinted in full. Here are a couple of selected quotes from that letter.
Panorama also made claims about our commitment to working conditions in our factories. We know of no other company doing as much as Apple does to ensure fair and safe working conditions, to discover and investigate problems, to fix and follow through when issues arise, and to provide transparency into the operations of our suppliers.
Apple are claiming that they do more than anyone else to ensure employee welfare, while at the same time there are safety nets up at the factories to stop employees committing suicide. Very clearly, Apple are not doing enough.
The BBC also made the claim that illegally-sourced tin was finding its way into Apple’s products, tin which is being mined in some places by 12-year-olds with virtually no safety.
Apple has two choices: We could make sure all of our suppliers buy tin from smelters outside of Indonesia, which would probably be the easiest thing for us to do and would certainly shield us from criticism. But it would be the lazy and cowardly path, because it would do nothing to improve the situation for Indonesian workers or the environment since Apple consumes a tiny fraction of the tin mined there.
So just to be clear, Apple could ensure that their raw materials are being sourced legally (and presumably safely) but they see this as "cowardly and lazy" because then they wouldn’t be engaging with (and helping?) the people who are currently mining the illegal and hazardous tin? Wow, that’s so altruistic of them. Nothing to do with costs, I’m sure.
Mr Cook, if you’re going to get on stage and announce that no-one else does as much as your company to provide good employee welfare, you have to be able to prove that you're making a difference with real results, not just signatures on paper. It’s one thing to say it in front of an audience of adoring fans, it’s another to enforce your code of conduct; printing a code of conduct does not mean that it is adhered to.
I wonder what the price of an iDevice would be if working conditions at Foxconn and Pegatron were raised to the point where the suicide nets could be taken down? I wonder how much Apple’s profit margin would be affected.
No, Mr Cook, I don’t believe that you’re doing enough for employee welfare. You may be right that Apple are the only Foxconn or Pegatron customer who has a code of conduct but I’m sufficiently convinced that this code of conduct carries no weight and it is not being adhered to.
Until Apple give up something of theirs to help those who are generating the profit for them, they have no right to expect those workers to be forced to give up something for Apple – something more valuable than profit.