On 27th August 2021, Ethical Consumer viewed Apple’s 2021 Supplier Code of Conduct Report, the most recent available, for information on how the company managed workers' rights in its supply chain.
Supply chain policy (rudimentary)
A strong policy would include 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.
Apple’s Supplier Code of Conduct, dated January 2rd March 2021 was viewed. The document contained clauses covering:
- forced labour, stating that "suppliers shall ensure that all work is voluntary"
- child labour, stating that suppliers "shall employ only workers who are at least 15 years of age"
- anti-discrimination, stating that suppliers "shall not discriminate against any worker based on age, disability, ethnicity, gender, marital status, national origin, political affiliation, race, religion, sexual orientation, gender identity, union membership, or any other status protected by applicable national or local law, in hiring and other employment practices"
- freedom of association, stating all suppliers "shall freely allow workers’ lawful rights to associate with others, form and join (or refrain from joining) organizations of their choice, and bargain collectively, without interference, discrimination, retaliation, or
These statements were deemed to be reasonable
It also contained clauses relating to working hours and wages. The latter was considered inadequate as it only required the payment of legal minimum wages, not living wages. The former was considered inadequate because it only stated that a workweek should be restricted to 60 hours and workers shall have at least one day off every seven days, except in emergencies or unusual situations. The Code of Conduct stated “This Code applies to Apple suppliers and their subsidiaries, affiliates, and subcontractors”.
Apple’s Supply Chain Policy was considered to be rudimentary.
Stakeholder engagement (rudimentary)
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.
Apple was a member of the Responsible Business Alliance. However, as an industry-only body (with no membership from NGOs or trade unions), this was not considered to be a multi-stakeholder initiative.
Apple stated that it worked with third party auditors but it did not identify them. It was thus considered that there was no real evidence of systematic third party involvement with auditing or managing the supply chain except with regard to specific commodities like tin.
Apple stated: "Our Code and Standards include non-retaliation protections and feedback channels, including grievance mechanisms at supplier sites. External third-party anonymous hotlines and the ability to contact the Apple Supplier Responsibility team directly at any time and in any language ensure that these requirements are upheld." On this basis, the company was considered to have an an adequate complaints process.
Overall, Apple was considered to have a rudimentary approach to stakeholder engagement.
Auditing and reporting (rudimentary)
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.
The report stated: that in 2020 "a total of 1,121 assessments across 53 countries were completed." There was a breakdown of results and details of consequences for non-compliance - corrective action plans and ultimately removal of suppliers. The report stated, "Since 2009 we have directed the removal of 24 manufacturing supplier facilities and 153 smelters and refiners from our supply chain." The report detailed one finding of debt-bonded labour and one finding of child labour. It stated "In 2020, 9 Core Violations were found (...) related to the labour, human rights and environment sections of our assessment protocol, including "7 instances of working hours or labour data falsification, 1 waste water violation, and 1 air emissions violation".
However, there was neither a clear schedule for audits nor a clear commitment to auditing the whole supply chain. No mention of the costs of audits could be found. Apple was considered to have a rudimentary approach to auditing and reporting overall.
Difficult issues (reasonable)
Ethical Consumer also deemed it necessary for companies to address other difficult issues in their supply chains. This would include ongoing training for agents, or rewards for suppliers, or preference for long term suppliers. It would also include acknowledgement of audit fraud and unannounced audits, and measures taken to address the issue of living wages, particularly among outworkers, and illegal freedom of association.
Apple did engage in some surprise audits. The report stated: "we increased the number of unnannounced assessments we conducted to more than 100". Apple further stated that "In 2019, Apple interviewed more than 57,618 supplier employees as part of supplier assessments" and "made over 34,000 follow-up calls to participating workers (...) in order to verify that the workers participating in interviews during our assessment were not retaliated against." These were considered a very rudimentary attempt to deal with audit fraud.
There was some discussion of particularly vulnerable migrant workers, and Apple stated that it was "mapping the higher-risk migration corridors for foreign contract workers" and was making some attempt to interview them. There was, however, no mention of other difficult issues such as banned trade unions, outworkers, or living wages. Overall Apple was held to have a reasonable approach to difficult issues.
Overall, Apple received Ethical Consumer’s middle rating for supply chain management overall and lost half a mark in this category.
2021 Supplier Code of Conduct and Supplier Responsibility Standards (2 March 2021)