Apple Inc. Corporate Ethics and Marketing Strategy

Introduction: Apple's Global Supply Chain

Apple is known across the globe for its quality products and up-to-date technology that allows users to feel ahead of other brands, fostering an ardent brand community with strong brand loyalty. In order to develop these technologies, Apple often outsources parts and services from developing nations, particularly in Asia. The preference for Asian manufacturing stems from the ability to achieve unprecedented turnaround times on new products with speed and flexibility unlike any other region. Apple also prefers sourcing component production from China, which places it close to hundreds of component manufacturers and engineers who are central to the production of final products (Harjani, 2014). This business model has proven highly profitable and has been used successfully over many years.

However, outsourcing services and manufacturing comes at a human cost, especially when companies source from countries where labor laws are weak or largely absent. Suppliers in such countries often treat employees as expendable — hiring and firing workers by the thousands in line with production cycles, pushing them to work extremely long hours, and leaving them physically exhausted and ill. These suppliers are also known to ignore safety issues, disregard environmental concerns, and fail to provide appropriate healthcare. Such conditions contribute to a negative perception of the companies that use their services and cast a shadow over their corporate social responsibility credentials (Hawthorne, 2012).

Apple's Ethical and Social Responsibility Guidelines

Faced with the potential loss of corporate integrity, Apple Inc. put in place guidelines that define the ethical standards and social responsibilities that all suppliers and their secondary partners must observe. These measures are designed to ensure that Apple customers do not become indirect supporters of inhumane production processes, and to make Apple products ethically sound from the manufacturing stage through to the point of sale.

The Apple Supplier Code of Conduct requires suppliers to observe the highest possible standards of environmental and social responsibility, as well as ethical conduct within their operations and toward their employees. Suppliers must provide safe working conditions, treat all workers with dignity and respect, act ethically and fairly toward each employee, and use environmentally responsible practices when producing goods or providing services to Apple Inc. (Apple Inc., 2012).

Apple also upholds human rights, and suppliers are forbidden from discriminating against or showing bias toward any employee on any grounds, particularly during the employment process. Apple emphasizes that no pregnancy or medical test should be required of an individual unless mandated by the law of that country or necessary for the safety of the employee in a particular working environment. Even where such tests are required, discrimination based on their results is not acceptable.

Suppliers are also forbidden from harassing employees or using abusive language toward them. Subjecting employees to inhumane or harsh treatment, physical coercion, or mental and psychological harassment is strictly prohibited under Apple's code of conduct. The use of involuntary labor and human trafficking is equally prohibited. Involuntary labor can take many forms, including threats, involuntary transportation, harboring workers against their will, abduction, and fraudulent recruitment, all of which Apple explicitly identifies as unacceptable.

Labor Rights and Working Conditions

Apple requires its suppliers to refrain from using underage labor, in line with International Labour Organization guidelines and the applicable minimum age laws of individual governments. Suppliers must also protect juvenile workers — those under 18 years of age — by ensuring they do not work at night or engage in overtime. This protection extends to student workers, who must be given schedules that allow them to continue pursuing their education.

Working hours are capped at 60 per week, including overtime. Employees must receive at least one day off per week. Suppliers are required to comply with all working-hour regulations stipulated by individual nations and regions, and any overtime must be voluntary.

Compensation for work must meet the minimum wages required by individual countries, and suppliers must observe legally mandated vacation, leave, and holiday entitlements. Where employees work overtime, compensation must reflect the applicable legal premium rates, and employees must be informed of these rates in advance.

Apple also insists that all employees working for its suppliers must be free to associate and engage in collective bargaining. Suppliers must provide channels through which employees can submit grievances, and management must maintain open lines of communication with the workforce.

To prevent forced labor, Apple requires that no supplier ask employees to surrender government-issued identification documents or travel documents. Suppliers must clearly spell out the terms and conditions of employment in contracts that employees can understand. No supplier may impose unreasonable restrictions on workers' movement within or outside the facility. Where a supplier uses a third-party recruitment agency, the agency must be made fully aware of Apple's standards and required to comply. Recruited employees must not be charged recruitment fees by agencies, and no deductions may be made from their salaries for this purpose. Compliance with these requirements is verified through unannounced, random audits conducted by independent auditors (Arthur, 2012).