« Back to Home Page

Sign up for the 3p daily dispatch:

5 Reasons Why Apple’s CSR Strategy Doesn’t Work

Raz Godelnik
| Friday May 18th, 2012 | 5 Comments

When a company is “starring” on TriplePundit every couple of weeks it’s usually an indication that either a lot of CSR activity is going on there or that the company has a chronic CSR problem. In the case of Apple it seems unfortunately to be the latter. Last week in a very interesting article on HBR Blog, Prof. Gregory Unruh of Harvard offered the explanation that Apple has a reactive CSR strategy, which he described as the “Little Dutch Boy” Strategy. In other words, Apple bothers to act only when there’s a complaint or protest against the company, hoping like the little Dutch boy that poking its fingers in the holes in a dyke will stem the flow and let the company go back to concentrate on designing and selling great products.

While Prof. Unruh is certainly right about Apple’s reactive strategy, I believe the CSR problems of Apple go beyond its reactive strategy. Looking at the main issues Apple has been struggling with in the last couple of years, I identified 5 main problems that cause Apple to fail time and again when it comes to CSR:

1. Lack of stakeholder engagement strategy – Apple simply doesn’t believe it needs to engage stakeholders, not to mention having an engagement strategy. We can see it every time, from not sharing information with Greenpeace about why Greenpeace got it wrong about the power consumption of Apple’s North Carolina data center to not responding at first to Chinese environmental groups investigating pollution issues in Apple’s supply chain in China. Another example is Apple’s tendency to reply to questions from the media about working conditions issues in its supply chain with a generic reply, such as: “Apple is committed to driving the highest standards of social responsibility throughout our supply base.“

These examples show that Apple is very reluctant to engage with any stakeholder that has a critical point of view of the company. The thing is that in all of these cases Apple had to change course eventually, revealing to everyone the information it didn’t want to share with Greenpeace in the first place, talking with the Chinese organizations and even providing more meaningful information to the media. If Apple will establish a strategic way to engage with stakeholders, just like Gap did successfully couple of years ago, it can save itself a lot of trouble.

2. Lack of triple bottom line thinking – Apple hasn’t really adopted the triple bottom line. For Apple it has usually been about maximizing its profits and addressing environmental and social issues as long as they didn’t make a significant impact on Apple’s income. Now, even when Apple claims to promote one of the other elements of the triple bottom line, like people for example, its practices show that it’s still really about the profits.

Take its supply chain – while Apple has a very progressive code of conduct, it also, as the New York Times reported, allows suppliers only the slimmest of profits, which often results in suppliers trying to cut corners, replacing expensive chemicals with less costly alternatives, or pushing their employees to work faster and longer. As Apple could see in the case of Foxconn, this approach can work for some time, but not for the long run. If Apple will start thinking about people and the planet as seriously as it thinks about profits, it might even find out that in the long run there’s no contradiction between these elements.

3. No CSR leadership or team – Unless you’re a company with a CEO devoted to CSR or an established CSR culture, you can’t really do CSR right without a dedicated CSR team. As Andrew Winston put it: “You need people to ride herd and drive the agenda — to do the cross-cutting analyses such as lifecycle assessments, to track and get a handle on the many diverse and complex issues, to present a unified front to employees and external stakeholders, to question business models and find new, heretical ways to operate and serve customers…the list goes on.”

4. Low level of transparency – While it is providing more information than many of its competitors (Amazon for example), Apple’s transparency is still far from being satisfactory. The company does not release a sustainability report, does not reply to the CDP surveys and, until recently, it also didn’t disclose the name of its suppliers or allow a third party to audit the working conditions in its supply chain. It’s time for Apple to stop being so hush-hush and start being more open about the way it does business.

5. Dated approach – Apple still doesn’t have a holistic approach when it comes to sustainability. You can easily see it on its website where there’s a separate page for environment, dedicated mainly to its footprint and a separate page for supplier responsibility, which is focusing on Apple’s supply chain. The division between social and environmental impacts is really out of date and even oil companies like Chevron now have a CSR page. All Apple has to do is to address its CSR approach just like an iPhone or iPad and remember to update it on regular basis.

Raz Godelnik is the co-founder of Eco-Libris, a green company working to green up the book industry in the digital age. He is an adjunct faculty at the University of Delaware’s Department of Business Administration, CUNY and the New School, teaching courses in green business and new product development.


▼▼▼      5 Comments     ▼▼▼

Newsletter Signup
  • http://www.sDialogue.com/ Perry Goldschein

    I’ve been wondering about Apple – good piece!  How do you think this CSR failure will affect Apple over time, unless it fixes this problem?

  • http://twitter.com/nery78 Nery Orellana

    Here is the hard truth. CSR won’t affect Apple period. Nor has it ever. And it’s real easy to pick on the biggest company on  the planet. Now ask yourself what is RIM doing? Nokia? Samsung? Here is the spoiler. A lot less then Apple.

  • Tam

    Nice piece.  And I think a lot of big companies in Apple’s position has dealt with these issues/criticism at one point or another.  It is my personal opinion that it is the responsibilities of companies in general (but especially those in Apple’s position, with a strong foothold in the market) to take a leadership position that not only impacts their bottom line, but people and the planet.  As much as we all love Apple’s creativity and many other great assets, companies in their position have more resources to serve as a good role model.

  • Jagdish Mahajan

    Interesting article. Basically it has two facets.It is but natural that we should expect the world’s most valuable company to lead in all aspects of social responsibility.And it is likely that in some aspects of CSR it may not be the leader. At the same time it is easy to pick on this company by saying that it has a reactive strategy because it attracts attention.A quick analysis of the Apple’s website will depict that their environment concern encompasses complete life cycle of a product.Their Data Centers run on renewable energy, their carbon footprint has been aggressively declining, products are free of toxic material, suppliers are monitored for workers’ conditions, environment stipulations and human rights violations etc. A fair comparison calls for similar analysis of competition.

  • Tanya

    Thank you for this great article!