On 16/08/2022, Ethical Consumer viewed the Apple Inc website for information on how the company managed workers' rights in its supply chain. The following documents were consulted: People and Environment in Our Supply Chain 2022: Annual Progress Report; Apple Supplier Code of Conduct (updated 2022)
1. Supply chain policy
Ethical Consumer looked for the following commitments: no use of forced labour, permission of freedom of association, payment of a living wage, the restriction of working hours to 48 hours plus 12 overtime (without exception), no use of a child labour (under 15 or 14 if ILO exempt), no discrimination by race, sex or for any other reason.
The policy on forced labour was adequate, as it prohibited all forced labour.
The policy required suppliers to respect employees' rights to freedom of association.
The policy on wages was considered to be inadequate, as it required suppliers to pay only the national minimum wages set by law rather than a living wage.
The policy on working hours was considered to be inadequate, as it appeared to allow working week of over 60 hours in exceptional circumstances.
The policy required suppliers to to eliminate all child labour, and defined the age of an adult as at least 15 years of age, the applicable minimum legal age for employment, or the applicable age for completion of compulsory education, whichever is highest.
The policy prohibited suppliers from all discrimination by race, sex etc
The code was stated to apply to the entire breadth of the supply chain: "This Code applies to Apple suppliers and their subsidiaries and affiliates, as well as any subcontractors and sub-tier suppliers (each a “Supplier”) providing goods or services to Apple or for use in or with Apple products.
2. Stakeholder engagement
Ethical Consumer deemed it necessary for companies to demonstrate stakeholder engagement, such as through membership of the Ethical Trade Initiative, Fair Labour Association or Social Accountability International. Companies were also expected to engage with Trade Unions, NGOs and/or not-for-profit organisations which could systematically verify the company's supply chain audits, and for workers to have access to an anonymous complaints system, free of charge and in their own language.
The company was a member of Responsible Business Alliance. However, this body did not meeet Ethical Consumer's criteria for a multi-stakeholder initiative because an industry-only body.
No evidence was found of systematic input from NGOs and/or labour and/or not-for-profit in the country of supply into the verification of labour standard audits.
The company had a mechanism by which supply chain workers could provide anonymous feedback on working conditions to the retailer or brand at no cost and in their first language, demonstrated by the following statement: "Our Code and Standards require feedback channels,
including grievance mechanisms at supplier sites. In addition, we provide third-party anonymous hotlines and the ability to contact the Apple Environment and Supply Chain Innovation (ESCI) team directly at any time and in any language."
3. Auditing and Reporting
Ethical Consumer deemed it necessary for companies to have an auditing and reporting system. Results of audits should be publicly reported and quantitatively analysed. The company should have a scheduled and transparent audit plan that applies to their whole supply chain, including some second tier suppliers. The company should also have a staged policy for non-compliance. The costs of the audit should be borne by the company.
Apple's report staed: "In reporting year 2021, 1,117 independent, third-party assessments were conducted in 52 countries" and In "FY2021, 11 Core Violations were found, including two debt-bonded labor violations, and nine instances of working hours or labor data falsification
The company published some data on the resullts of supply chain audits, however, this was considered to be inadequate because it did not publish complete results at the level of individual suppliers.
No published schedule for supply chain audits could be found.
The report stated: "Since 2007, Apple-managed assessments have covered 94 percent of Apple’s direct manufacturing spend", however, no statement was found comitting the company to auditing its entire supply chain on an ongoing basis.
The company had an adequate policy for handling instances of non-compliance with its code of conduct, which included a staged approach to dealing with violations demonstrated by the following statement: "If we uncover non-compliance, we take prompt action
to ensure suppliers not only correct the issue, but make meaningful, long-term changes. We do this through a Corrective Action Plan (CAP), during which 30-, 60-, and 90-day check-ins with Apple are required. We then conduct our Corrective Action Verification (CAV) process to verify that all corrective actions have been successfully implemented, and necessary steps have been taken to prevent a reoccurrence."
No information was found regarding whether or not the company paid for the costs of supply chain audits.
4. Difficult issues
The company was not considered to have adequately addressed difficult issues around purchasing by committing to either long-term relationships with suppliers, training for buying agents or rewards for suppliers.
The report stated that Apple conducted unannounced audits of suppliers:. "Every year, we also conduct unannounced assessments
and unannounced visits in response to workers’ grievances and allegations, or to verify risks at supplier facilities based on predictive analytics. In FY2021, 211 unannounced assessments and investigations were conducted where the supplier facility was provided no advance notice of our arrival." This was considered to be addressing the difficult issue of audit fraud.
A measure the company was taking, which was considered to be significant was aof particularly vulnerable migrant workers, and Apple stated that it was "mapping the higher-risk migration corridors for foreign contract workers"
No evidence was found that the company was taking steps to address the issue of living wages.
Overall, Apple Inc received a middle Ethical Consumer rating for Supply Chain Management and lost half a mark in this category.
2022 Annual Progress Report People and Environment in Our Supply Chain (16 August 2022)