It seems like the “Apple” of the eye is the talk of town this year. January was all sweet news as the world anticipated and later debated the features of iPad – Apple’s flagship device that’s shipping April 3. On the other hand, the month of February has not been as kind to Apple – especially its supply chain. First, came reports that an Apple Supplier (read Foxconn) had roughed up a Reuters reporter in China. This news caught wind and brought back memories of the Foxconn iPhone leak suicide case. I’d debated whether these acts were turning into a New kind of Supply Chain Risk caused due to over-secretive company policy. Later towards the end of February, reports started floating around claiming Apple’s supplier responsibility report contained a mention of illegal child workers – an issue that spread like wildfire and prompted many strong reactions. I wrote a post about this issue detailing what companies need to do if they were faced by similar issues. This post, entitled “The Apple that ate the child” went on to become the one of SCM Blog’s most popular posts in February. Today, I aim to compare Apple’s Supplier Responsibility Reports from 2009 and 2010 and present my findings. I think you’re going to be quite surprised. The impact – as always, lies in the minute details.
Change in focus: As I looked through both reports, closer to the top, I saw a slight change in how the report opened. I’ve pasted screenshots here to show you what I mean. In 2009, the introductory passage looked to familiarize the reader with Apple’s supply chain structure and make him understand who was being measured. In the 2010 report, Apple looks to make the reader understand the importance of the supplier code of conduct. It clearly articulates the areas in which the Supplier Code of Conduct seeks to exercise its authority.
This is a good step forward. Apple has looked to depict the seriousness with which it looks at the various aspects of Supplier Responsibility in the 2010 report. Apple gets a plus for this one.
Number of facilities audited: Apple has audited more locations in 2009 than it did in 2008. In the 2009, they’d audited 102 facilities compared to 83 in 2008 and 39 in 2007. However the rate of increase in the number of facilities audited has reduced dramatically. I’m not quite sure if this is because they plainly ran out of facilities to audit or something else. My tries to find out the total number of facilities Apple’s suppliers run ended a blank. Do let me know if you have some insight into how many facilities Apple has in total.
The Child Labor Saga: This fact is something that shocked me too. After all the angry commentaries we’d read about Apple finding illegal child workers in their supply chain. Check out the images to the left. Turns out, the 2009 report tells of Apple having found illegal child workers in SEVEN facilities compared to the THREE facilities quoted in the 2010 report. I wonder if there was as much noise made about the same issue last year. Any comments?
Environmental Impact: There are a few more disturbing facts that I was able to uncover from the report for those concerned about the Green Apple. The percentage of compliant comapnies has gone down from 2009 to 2010. While this is probably because of the increase in the number of facilities they audited this year, the decrease is uniform across a lot of categories. For instance, the percentage of “Management systems in place” for over 5 categories went down in 2010 compared to 2009. Check out the two graphics here. The one colored blue is from the 2009 report and the green image is from the 2010 report.
You can look at the reports for yourself here. It certainly looks like there is a lot of information in the supplier reports that a company could use. Especially if you’re Apple’s supplier and have not been audited yet. Should Apple really have rated themselves so high? Are they doing enough? What do you think? Let me know in the comments section.