NRDC Work on Apple Computer's Supply Chain

As Apple moves forward to address environmental problems in its supply chain, the opportunity is wide open to become a model for other companies to follow.

 As USA Today reports,  Apple is moving forward with the Natural Resources Defense Council and the Institute of Public and Environmental Affairs (IPE), a Chinese NGO,  to address environmental problems in factories in its supply chain in China.  The company has already put corrective actions in place in more than a dozen factories and is gearing up to identify and then address other existing environmental problems elsewhere.

Cynics are probably right that none of this would have happened unless Apple got in trouble.  IPE released a detailed report in September on more than a dozen factories in Apple’s supply chain that had been cited by government officials for environmental compliance problems, (The Other Side of Apple II). 

As those of us who have worked in China heartily agree: by the time government cites a factory for environmental discharge problems, things are probably pretty bad.  So this list of violators caught everyone’s attention, including Apple executives.

However, I think most people would also agree that if Apple can get this right, a lot of companies will follow. 

That’s why we jumped into this with both feet.  After four years of work in China in other sectors, I can tell you that it is not easy to find motivated and highly functioning international entities of any sort to solve the environmental problems caused by globalization. 

As I have found to be the case with almost all companies, Apple’s corporate responsibility programs now fall short of what is necessary to effectively address egregious environmental problems.  But the company is stepping up. It is too early to say what its effort will amount to, but I have found there a genuine desire to get on top of this problem and get the job done right starting now.  And the company is certainly capable of taking this on and becoming a model for other multi-nationals operating in the wild, wild east (The Ugly Side of Globalization).

So, what does serious 2012-level work to curtail environmental supply chain problems look like?

 Pay attention, other multi-national corporations, because few if any of you are doing this!!  Your day of reckoning is probably not too far behind:

  1.  The multi-national corporation has mapped its supply chain and knows the factories that make its stuff – all the way from beginning to end.  In this mapping exercise, it has identified the chemicals used and released and spotted the likely environmental “hot spots” – places that use large quantities of energy, water, and/or toxic chemicals – to concentrate focus where things matter the most.
  2. The multi-national corporation is routinely tracking and monitoring environmental performance of these factories at scale.  Not a pilot program of a handful of facilities – I’m talking about all, or at least a critical mass, of their strategically important suppliers. 
  3. The multi-national corporation requires that factories address violations or problems  expeditiously and inspects improvements to verify they are really in place.
  4. The multi-national corporation disqualifies repeat violators with significant violations from doing further business with the multi-national.
  5. The multi-national corporation requires its factories to routinely disclose information on significant environmental matters to the general public, and to create a means of communicating back and forth with their local communities so that complaints are heard, recorded, and addressed promptly.

All of this is basic stuff for companies still operating in America; those who have not ventured abroad likely find this list to be a ho-hum, obvious set of cornerstones of a basic environmental compliance program. However, this agenda is far, far, far from the scope of the Corporate Social Responsibility/Sustainability departments in most if not all multi-national firms today.  (More on that in a future blog). 

So, headline news:  Apple is stepping forward to take the first bites of this work.  (I hereby knight the Apple logo with an important second meaning.)   The company already has 14 in-depth audits of factories that IPE reported with problems and has required corrective actions.  From there, Apple says it will scale up its routine audit processes to find any other existing problems and put policies and programs in place to prevent new problems from arising.  The company is even willing to engage in investigating paths forward for public disclosure. 

If we succeed, it could be a real game changer for environmental protection in China. 

So, fingers crossed, wish us luck.  I’ll be in touch on how it goes.