Sun, Jan 15, 2012 - Page 10 News List

Apple discloses list of suppliers

BAD APPLES:Internal probes found a number of violations relating to pay, benefits, underage labor and environmental practices in plants in China

Reuters, SAN FRANCISCO

Apple revealed its closely guarded list of global suppliers for the first time and promised to deal with worker abuses, hoping to deflect criticism it was turning a blind eye to cases of poor working conditions in a mostly Asian supply chain.

The dramatic and unprecedented step — unveiling the names of 156 companies that represent 97 percent of the company’s supply chain — was an unusual move in an industry that relies heavily on foreign component suppliers to drive margins.

It is rarer still for a notoriously secretive company, underscoring speculation that new chief executive Tim Cook has ushered in an era of greater transparency. Predecessor Steve Jobs, who died in October last year, kept an iron grip on the internal workings of the company he founded and turned into the world’s largest technology company.

Apple’s list is the culmination of internal probes into its supply chain, spanning hundreds of audits over years and high-profile firms from Foxconn Technology Group (富士康集團) or Hon Hai Precision Industry Co (鴻海精密) to Samsung Electronics Co. Foxconn in particular has dragged Apple into headlines after a spate of worker suicides raised questions about conditions at its Chinese plants.

Apple said it found six active and 13 historical cases of underage labor at some component suppliers, but none at its final--assembly partners.

“With every year, we expand our program, we go deeper in our supply chain, we make it harder to comply,” Cook said in an interview. “All of this means that workers will be treated better and better with each passing year. It’s not something we feel like we have done what we can do, much reamins to be done.”

The audit conducted by Apple of suppliers found a number of violations, among them breaches in pay, benefits and environmental practices in plants in China, which figured prominently throughout the 500-page report Apple issued.

Other violations unearthed included dumping wastewater onto a neighboring farm, using machines without safeguards, testing workers for pregnancy and falsifying pay records.

Apple did not identify the facilities where it found violations.

Apple said it conducted 229 audits last year, representing up 80 percent over 2010. From 2007 to 2010, the company conducted only 288 total audits. It looked at all levels of its supply chain, including final assembly and component suppliers.

“I would like to make a significant improvement in the overtime area. I would like to totally eliminate every case of underage employment,” Cook said. “We have done that in all of our final assembly. As we go deeper into the supply chain, we found that age verification system isn’t sophisticated enough. This is something we feel very strongly about and we want to eliminate totally.”

Apple said it would grant access to an independent auditing team from the Fair Labor Association, in its continuing effort to overcome criticism regarding working conditions at its supply factories. It also terminated business with one unidentified supplier and was “correcting” the practices of another.

Both were repeat offenders, the report said.

Apple’s audit found out that only 38 percent of suppliers adhered to its code of a maximum work week of 60 hours. Also, foreign contract workers in 15 facilities paid excessive recruitment fees to labor agencies, the report said.

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