Question

Evaluate how the business ethics and regulatory issues for Apple, Inc will impact the community. Support your response with research in best practices in CSR.

Global Environment: Evaluate how the business ethics and regulatory issues that you previously described will impact the global environment of Apple, Inc. Support your response with research in best practices in CSR.

Answer 1

Apple Inc, is a American multinational company which manufactures technology products such as mobile phones, laptops, etc. The company was established in 1976 and has its headquarters in Cupertino, California, USA. Although Apple has been known for its innovation in technology, however, it has also recently come into light for certain ethical issues.

Every company has a different supply chain structure. In case of Apple, the raw materials are sourced from different countries and are assembled in countries like China. Millions of Chinese people are employed by Apple’s supply chain located in China with a contractor called Foxconn. Primary reason for choosing China can be accounted for lower manufacturing costs. This has however resulted in neglect of the company with regards to ethical issues.

I have listed some the ethical and legal issues/cases against Apple Inc:

1. Poor pay and excessive work hours – In 2011, serious ethical issue allegations where raised against Apple Inc. Poor working conditions were reported in its manufacturing plants located in China. The employees were also made to work overtime beyond the specified time set by the Chinese government. Other issues such as environmental hazards, child labour, etc also came to light. There have also been cases of employee suicides due to intensive work requirements.When the loyal Apple customers found out about these issues, they boycotted the company’s products. This resulted in not only the loss in sales but also made a major dent in the company’s international reputation.
2. Apple users sued the company for recording and selling their data – Iphone users location was being monitored by their smart phones. A judge ruled that consumers could sue the company for allegedly letting advertisers track the users activities.
3. Discrimination Lawsuits – Apple’s ex-employees filed discrimination cases against the company for paying lower salaries on the basis of the employee's race

These issues when highlighted came as surprise to many of its customers who thought that the company would have high ethical values because of its reputation in the field of innovation. The negative impact created in the minds of stakeholders due to these issues may have led to the company focusing on CSR activities to maintain its good image in front of its stakeholders such as investors and customers. Today, with increasing awareness about environmental and social issues, its important for companies to look for ways to give back to the society. Apple companies now follows certain best practices with regards to CSR and these have also been highlighted in the company's website in their policies section.

Some of the best practices in CSR are :

1. Stakeholder engagement : It is important the company as well as its stakeholders hold the same values and ethics. The company should take active measures to ensure that regulations and guidelines are followed by all. The policies section in Apple's website showcases its promise to the stakeholder that it ensure regulatory guidelines are followed by its suppliers

2. Sustainability Management System : To ensure environmental, social and economic concerns are taken into consideration in the organisation's decision making. The company highlights its efforts in employee training and education as well as focusing on creating an environment for their development.

3. Lifecycle Assessment : The companies responsibility does not end with the sale of the product. In today's scenario it is also important to consider environmental issues such as E-waste. Company like Apple has taken measure to minimize its e-waste by associating with its customers and suppliers