Apple Talks Corporate Social Responsibility

Editor’s Note: This article originally appeared in the May issue of Green Money Journal.

By Bennett Freeman

Over the last decade, Apple has become one of the most iconic brands in the world.  It stands for innovation — innovation in its technology, design and product experience. And it has been a magnet for responsible investors, whose portfolios have been served well by holding the company.

At the same time, like its peers and competitors in the consumer electronics industry, it faces tough issues around labor and human rights in its relationships with its suppliers — some of which manage massive workforces in countries such as China. Apple has been a leader in the supplier responsibility space, but has learned that it is difficult — if not impossible — to achieve the same level of perfection on these issues as it does in its products.

Jacky Haynes, Apple’s senior director of supplier responsibility, has been at the forefront of the company’s efforts to manage these relationships. Unlike many of her peers at other companies, she has built her career in operations and on factory floors, giving her a unique perspective on how supply chains and assembly lines work — and an unusually informed perspective on workers and workforce management. Jacky has been tireless in her work with Apple’s suppliers, but she's the first to admit that she is constantly learning new lessons along the way on how the company can continue to improve its approach to these complicated issues.

I sat down with Jackie to hear her thoughts on corporate social responsibility (CSR) and supply chain management.

Bennett Freeman:  Unlike many other companies, Apple’s social responsibility team sits within its operations team. What are some of the insights you bring from your many years on the operations side of Apple to the company’s social responsibility function?

Jacky Haynes:  The way we think about supplier responsibility at Apple is that it’s entirely intertwined with operations. We can’t do the work we do, deeply embedded in the supply chain, without the operations team. They are as likely to knock on my door to ask for help as I am to knock on their door. I came into this role with 30 years of experience in operations, so I have real experience and relationships in that world. I can tell you without a doubt I would not have come back from retirement to take this job if we did not have a management team, up through and including our CEO Tim Cook, who was totally committed to the work we are doing.

At Apple, we believe that every worker in our supply chain has the right to safe and ethical working conditions. That’s just not a slogan on our website; it’s something we live and breathe every single day. And it’s not just the responsibility of my team; it’s also the responsibility of the hundreds of Apple employees in our factories every single day. One of the things that really distinguishes the work we do in supplier responsibility is that we have boots on the ground all the time. I don’t believe that my job can be done from behind a desk, so I spend a lot of time with my team in the factories talking to managers and attending audits.

BF:  In the wake of the New York Times investigative reporting on Foxconn in early 2012, Apple faced sharp scrutiny regarding its supply chain practices and has addressed these issues by joining the Fair Labor Association and strengthening its policies and management systems in recent years. What improvements have been made and what lessons has the company learned?

JH:  In fact, we’d been working on these issues for some time. We had what we believed to be — and still do believe — one of the strongest codes of conduct in the industry. I think we had to learn that this work is a journey. We really looked at ourselves and realized that we don’t know if, when and how we’ll ever be done, no matter how good of a job we are doing.

We care so much about perfection in our products. We want that same level of perfection in our supply chain, but it’s very hard. So I’d say looking in the mirror and dealing with that reality was a very, very difficult thing for us to do, and so we redoubled our efforts on many fronts.

Our first lesson was that we needed to be sure that we were designing supplier responsibility programs with the same level of attention to detail and innovation that we bring to our products—and we need to be able to do that at Apple scale. And for Apple, scale means that our top 200 suppliers manage over 750 facilities worldwide at all levels of our supply chain — and manage over 1.5 million workers. So, that’s the challenge ahead of us.

We learned that we really needed to focus on tackling the root causes of any issues we observed within the supply chain. For example, we saw that workers weren’t wearing the appropriate personal protective equipment. It wasn’t that workers were intentionally violating the policy, but that factories didn’t have properly trained people to evaluate workers’ health and safety and put a program into place. So we took that observation, among others, and launched the Environment, Health, and Safety Academy to try to address the root cause of some of the health and safety violations.

And then finally, we realized we needed to be more transparent and open around the work that we are doing. If you look at our reports for the past three years, we have increasingly added transparency into our reporting, including listing our suppliers, our smelters in the conflict minerals program, and the standards that sit behind our code of conduct. We think it’s really important to talk to our friends, our critics, and our partners about the work that we are doing, because hopefully we can inform them and they can inform us, and we’ll improve.

Read the complete interview here. 

Image credit: Flickr/Aurimas

Bennett Freeman was the Senior Vice President for Sustainability Research and Policy at Calvert Investments for nine years from April 2006 through April 2015.