Corporate governance refers to various policies, practices, and regulations used by various parties to oversee a company’s operations. The role of corporate governance is to ensure that managers deliver the company’s long-term objectives (Bhagat & Bolton, 2019). Corporate social responsibility (CSR) is a business practice that allows companies to integrate social and environmental concerns into their daily operations. In other words, a management practice that ensures that business organizations ethically interact with all their stakeholders. Sustainability means protecting natural resources to maintain an ecological balance (Breuer et al., 2018). This paper aims to discuss issues surrounding the corporate social responsibility of Apple Inc. Read more

Apple is a giant tech company based in California, specializing in software and hardware and online services. Apple Inc. was accused of gross labor rights violations in China at Foxconn in 2009 (Lee, Mol, & Mellahi, 2016). Additionally, similar allegations were reported about the company in 2014. However, this time the labor rights violations involved another Pegatron, an extensive Apple company’s supplier specializing in the assembly of iPhones (Lee, Mol, & Mellahi, 2016). The author of this article believes that Apple Inc. was only singled out unfairly as its competitors were also engaging in similar practices. In my view, it is also not Apple’s responsibility to take the blame for the labor rights violation that occurred at Foxconn and Pegatron. This is because most of the company’s operations are undertaken outside the United States. In other words, Apple Inc. operations are outsourced to independent suppliers, located in different countries such as China. Order

The BBC documentary on labor laws aimed at painting Apple’s public image negatively. However, Jeff Williams did not comment on the documentary on camera. Still, he responded by writing a letter to all of its employees in the U.K. William reiterated on the company’s commitment to ensuring fair and safe working conditions, investigating problems and fixing them, and providing transparency regarding the operations of suppliers (Lee, Mol, & Mellahi, 2016). In response to prior allegations, Apple Inc. prepared codes of conduct and enforced its suppliers to comply with some of the regulations (Lee, Mol, & Mellahi, 2016). However, compliance was difficult to ensure as the company was not involved in the day-to-day monitoring of its suppliers’ activities. Corporate Social Responsibility

Apple gave a deaf ear to the labor laws violation claims for several reasons. One of those reasons is that the company chose offshore suppliers rather than sourcing from the United States because they could produce what was needed within a short period (Lee, Mol, & Mellahi, 2016). For instance, Steve Jobs ordered a change in the iPhone screen material from plastic to glass before the debut of the first iPhone in 2007 (Lee, Mol, & Mellahi, 2016). He wanted it to be done within six weeks, but no American company could manage to supply glass screens within a month. A Chinese company took the challenge and made it through an increased workforce and operating in shifts.

The second reason why Apple preferred sourcing from companies in other countries is that they are cheap compared to sourcing from within. For instance, Apple chose Pegatron to Foxconn as the former was willing to accept thinner margins than the latter. In other words, Pegatron accepted a margin of 0.8 percent, while Foxconn was seeking to work with a margin of 1.7 percent (Lee, Mol, & Mellahi, 2016). This allowed Apple Inc. to produce cheaper versions of the iPhone 5 series without jeopardizing its profit margins.

This article observed that the numerous CSR failures did not affect the business performance of Apple Inc. As a matter of fact, Apple company featured in Forbes in 2015 as one of the world’s most valuable brands (Lee, Mol, & Mellahi, 2016). Moreover, the company enjoyed unwavering customer loyalty despite the negative publicity. As we advance, Apple Inc needs to consider several things. One, the company should not ignore the public image created by labor law violations. Secondly, the company should consider improving its suppliers’ working conditions or sources for other suppliers who meet all the labor laws requirements. However, it is imperative that working with a company that meets all the requirements would negatively impact its profitability. Corporate Social Responsibility

In conclusion, Apple Inc. has been linked with CSR issues relating to two of its leading suppliers, Pegatron, and Foxconn. However, it is mysterious how Apple was picked out from its competitors such as Samsung, Nokia, and Huawei, engaging in the same practices. Despite the claims of labor laws violations, Apple Inc. prefers working with offshore suppliers because they can produce the required products within a short time and are not expensive, like American suppliers. Apple Inc. doesn’t need to make further changes to the CSR policies; neither is it reasonable to apply different ethical standards to other countries. The numerous CSR failures did not affect the business performance of Apple Inc. However, it is important to reconsider how suppliers’ labor law violations may affect the company as profitability, and positive public image are essential.

I recommend that Apple apply CSR approaches on a scale-by-scale basis as ethical standards differ between countries where suppliers are based. Additionally, I do not find it necessary for Apple to make further changes to its CSR policy. If I were in Jeff William’s position, I would endeavor to work with companies that meet all the labor laws provisions but relatively cheap. This is because both increased profits and an excellent public image are essential to Apple company. If I were a socially responsible investor, I would still invest in Apple company. This is because Apple company has no control whatsoever of the numerous CSR issues of its suppliers. Corporate Social Responsibility