Did Apple become more ethical since Steve Job’s Death?
Despite the fact that most multinationals are increasingly becoming aware of the consequences that would befall them for soliciting cheap labor and creating sweatshop conditions, the absence of universally defined standards defining the acceptable corporate citizenship restricting them, they will continually push the bounds of what is corporately unacceptable in their quest to reap maximum profits out of the least possible investment. Apple Inc is an example of such companies that has attracted numerous critics for its disregard of human rights and corporate social responsibility. Apple Inc is a multinational tech company compan y based in America with its headquarters in California. he company specializes in developing software for computers, phones and tablets. Apple was founded in !"#$ by %teve &obs, %teve 'oznia(, and )onald 'ayne. 'ayne. %ince its inception into the mar(et, the company compan y has significantly grown to becoming one of the mar(et leaders as evidenced by the huge revenues. Apple Inc is the world*s largest largest publicly traded company with a value of over +%D #--billion /ucas et al. 0-!12. he company en&oys significant levels of loyalty among its customers based on the Inter3brand 4est 5lobal 4rands report. Despite the huge revenues and high levels of loyalty, the company has faced challenges related to ethical issues in the recent past. he issues range from poor wor(ing conditions to harassment and intimidation. In 0--$, a media report revealed how the company*s employees based in China wor(ed for more than $- hours earning !-- a month. In addition, several media reports have indicated that the company compan y engaged in child labor. herefore, this paper see(s to investigate whether Apple Inc increased the level of C%) after the death of %teve 6obs. he paper provides evidence to support the researcher*s argument that that the company has increased its C%) levels after the death of %teve 6obs. 7art 7 art one outlines the various ethical issues that implicating
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Apple Inc. citing specific instances. he subsequent section discusses some of the steps that apple has underta(en to reinforce its image and corporate social responsibility and the last part of the paper highlights some of the recommendations and the conclusion. Ethical Issues Surrounding Apple Inc
According to Clar(e and 4oersma 0-!<2, Apple Inc has attracted many critics due to the issues surrounding its supply chain management. Although the company en&oyed a period of economic progress after the return of %teve 6obs, evidence shows the serious consequences of unresolved human rights issues in the Apple*s supply chain based in China. Despite the quality and beauty associated with Apple*s products, Clar(e and 4oersma 0-!<2 noted that the employees producing the gadgets have poor wor(ing conditions and disregard for human integrity is a normal thing. =owever, poor wor(ing conditions are common in ma&or electronics manufacturing companies based in Asia, including the supply chains for Dell, 9o(ia, and %ony. As the mar(et leader in the field of electronics, Apple has the responsibility of ensuring high integrity and dignity of the supply chain. 1. N-heane poisoning at !inte"
8arly in 0--", one of the primary Apple*s primary suppliers, 'inte(, that manufactured touchscreens for the i7hone, used n3hexane in one of their plants, 8ast China /CD so as to accelerate the production process due to inflation in demand. 'or(ers reportedly suffer from nerve disorders due to the chemical. It is alleged that 'inte( coerced the affected wor(ers to resign so that they could absolve the organization of any future liabilities. 'inte( offered cash settlements. >or those wor(ers who refused, the company forced them to wor( for long hours disregarding their state of health. #. Suicides at $oconn
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According to /ucas et al. 0-!12, >oxconn echnology group, another primary Apple*s chief suppliers, produces around ?-@ of the world*s total electronics. Additionally, the company has employed approximately !.0million people. +nfortunately, ma&ority of these people wor( under deplorable conditions. he wor(ers live and wor( in a highly populated area commonly referred to as the >oxconn CityB. In 0-!-, fourteen employees committed suicide in >oxconn City within a period of eight months, four suicidal attempts failed and twenty attempts were prevented by the security officials. hese high rates prompted the %cholars and %tudents against Corporate isbehavior to conduct undercover investigations of the >oxconn organization. he investigations revealed that the wor(ers were exposed to harsh wor(ing conditions, thus denying them dignity. he report also established that the ultimate principle was profit maximization and the wor(ers welfare was not a concern %AC:, 0-!-2. Another report by Chinese sociologists revealed that many immigrant wor(ers had appealed to the authorities to rid some policies that allowed >oxconn to exploit the vulnerable %AC:, 0-!-2. Apple was at the center of the accusations as it is the largest customer of the > oxconn group. >oxconn group produces high profile Apple gadgets such as the i7od music and iphone mobile products. he suicidal attempts too( place despite Apple*s 0-!- supplier code of practice that stipulates, All suppliers must uphold the human rights of wor(ers and treat them with dignity and respect as recognized by the international communityB. A group of !<- wor(ers participated in mass protest at >oxconn in 0-!0. hese wor(ers were protesting the harsh wor(ing conditions. %. &a Evasion
According to Eerschoor 0-!12, Apple Inc avoids paying billions of money due to strategies that many consider as illegal. Eerschoor 0-!12 noted that Apple*s tax structure is difficult if not impossible to understand. he company has stationed its offices in areas of low
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tax rates, a move that saves the company a lot of money. Infanti 0-!<2 points out that since 0--" to 0-!0, Apple*s tax system has managed to evade taxes amounting to ?? billion. he iax structure is simpler as compared to the Double Irish, Dutch %andwich structure used by other multinational companies. o ensure the company evades significant taxes, Apple Inc established wholly owned subsidiaries in various parts of the world such as the Apple :perations International A:I2 and Apple :perations 8urope A:82 in Ireland in !"F-. Ireland tax rates are reported to be significantly lower as compared to the tax rates in America. he Apple :perations International is a shell company based in Ireland with no employees. he move to station the company in Ireland was motivated by the definition of corporate tax residence of Ireland that ma(es the country a better partner than the America. According to Infanti 0-!<2, the Irish definition of corporate tax residence is determined by the central management*s location. :n the other hand, the +% corporate tax residence is determined by the location of incorporation. Apple :perations International does not fall into the category of the +% law nor the Irish law. %ince the company is an intermediate holding company for many groups of companies with operations overseas, it saves lots of money that would have otherwise been taxed. >or instance, for the period between 0--" and 0-!0, the company received dividends of about +%D 1-billion but has not paid any corporate tax. 'orrective Actions &a"en () Apple to Address the Ethical Issues
Although Apple Inc has attracted critics due to the neglect of ethical issues, the company has underta(en significant steps in the recent past to address the critics. According to >rost and 4urnett 0-!<2, the company has intensified audits since 0-!1. he audits aim at revealing non3 compliance with the %upplier Code of Conduct. 'here noncompliance is revealed, the company
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wor(s in hand with the supplier to address the issue and drive change. he company has also expanded education opportunities to its wor(ers. his is a corporate responsibility issue that Apple was in the past accused of neglecting >rost and 4urnett, 0-!<2. he company has also engaged in numerous campaigns aimed at cleaning its name against tax avoidance. Also, the company has defended itself from Congress arguing that it has not evaded tax and that it has fully complied with the laws of the land. =owever, no visible steps have been ta(en to show that the company is willing the tax in which it is accused of evading 'allace et al. 0-!?2. )egarding the issue of poor wor(ing conditions for the supply companies, Apple has continually emphasized the need for >oxconn to comply with the supplier code. According to %AC: 0-!?2, >oxconn has significantly improved the wor(ing conditions of its employees although they do not meet the international standards. he >air /abor Association shows that >oxconn has reduced the number of wor(ing hours to $-hours. Apple in the recent past has ta(en stringent measures against its suppliers who violate its code of conduct. >o r instance, Apple dropped 7ingzhou 8lectronics as one of her supplier for engaging in child labor. 'onclusion and *ecommendation
It is agreeable that Apple Inc has attracted numerous critics due to failure by the management to address the critical issues. =owever, I feel that the company has made significant steps to promote good wor(ing conditions not only in its headquarters, but also in the supplier companies. %tringent measures such as dropping the supplier are among the recent steps that the company has ta(en to uphold dignity and integrity. Apple should as well consider increasing its scope of Corporate %ocial )esponsibility activities to create a better na me for the company as well as improve the customer loyalty.
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)eferences Clar(e, ., G 4oersma, . 0-!<2. he governance of global value chainsH +nresolved human rights, environmental and ethical dilemmas in the apple supply chain. Journal Of Business Ethics, doiH !-.!--#s!-<
>rost, %., G 4urnett, . 0--#2. Case studyH the Apple i7od in China. Corporate SocialResponsibility & Environmental Management , 1402, !-13!!1. doiH!-.!--0csr.!?$
In Infanti, A. C. 0-!<2. Controversies in ta la!" # matter of perspective. /ucas, J. Jang, D. G /i, K. l. 0-!12. 'or(place Dignity in a otal InstitutionH 8xamining the 8xperiences of >oxconns igrant 'or(force. Journal Of Business Ethics, 114!2, "!3 !-$. %AC:. 0-!-2. 'or(ers as machinesH ilitary management in >oxconn. )etrieved from httpHsacom.h(wp3contentuploads 0-!-!!report3on3foxconn3wor(ers3 asmachinesLsacom.pdf Eerschoor, C. C. 0-!12. aximizing )eturns or +nethical ax AvoidanceM. Strategic $inance, %#2, !13!$.
'allace, D., In % Nabah Ni, 4., In 4irch, 9. 6., In /aird, I. A., G In )ivas, 6. 0-!?2. # revolution in the international rule of la!" Essays in honor of 'on (allace) Jr .
