Brands will shape Global Labor Standards: Apple-Foxconn Company

Tim Cook, Apple COO, in january 2009, after Ma...

Tim Cook, Apple (Photo credit: Wikipedia)

When Apple signed on to Fair Labor I wrote a column in which  suggested that the logic of their decision – a big shift in approach post-Jobs – would be to bring about alignment between western and  Chinese labor standards. Nothing that has happened since has changed my view. Not that this will happen overnight, of course. But it’s the result of several potent forces that are shaping, not least, this company’s effort: branding and global communications. Whereas these forces twisted the unwilling arm of Nike what seems a long time ago, the superlative quality of the Apple brand and the explosion of social media are together pouring gas on the flames.

While it has been traditional to label western brand efforts to ensure decent manufacture conditions for their products as “corporate social responsibility,” the logic of the Apple case demonstrates that it is naive to see CSR as an adjunct effort, or a marketing ploy, or as anything other than central to value. It’s a case where the values-value connection (another theme of mine) is especially glaring.

The harrowing case of the Foxconn worker with severe brain damage, whose family is now going to the Chinese courts to seek to maintain full company support of their son, drives the point neatly (if tragically) home. This man is, as all can see, a de facto Apple employee, whose conditions of service are so far removed from those of the guys at HQ as to be hard to compare. As his family struggles to ensure that he has long-term care after an undenied industrial injury, they have a bullhorn to the world, and that includes the fashionistas for whom the latest Apple gadget is a must, and who have helped drive up its astronomical share price and stack up a mountain of dollars that could buy Facebook twice over for cash (or buy everyone on the planet a half-decent bottle of wine). As the technological gap, and the design gap, between Apple products and those of its rivals narrow, the brand magic is going to be even more key – and therefore even more exposed.

It was a smart move for Tim Cook to jump into Fair Labor, and then arm-twist Foxconn into big wage increases. It would be even smarter for them to leapfrog the moral/CSR competition and drive excellence in Chinese manufacturing and labor practice without needing to be pressured further.

http://bclc.uschamber.com/blog/2012-02-03/csr-and-burden-outsourcing-apple-opens-door

Foxconn goes to court over severely injured worker | Business Tech – CNET News.

Apple signs up to Fair Labor

http://www.prnewswire.com/news-releases/apple-joins-fair-labor-association-137285303.html

http://www.fairlabor.org/fla/go.asp?u=/pub/mp&Page=WWD

News that Apple has signed up to the Fair Labor movement is highly significant. A risky move for a large company with many suppliers in parts of the world where labor conventions differ widely from those of humane western commentators, this exposes both Apple and its supplier network to public scrutiny. Apple must be confident that they can exercise enough sway over those suppliers, and especially the notorious Foxconn, to carry this off. At the same time, it significantly strengthens their hand in the process. Their entire supply chain just became an open book to the NGO community and the global press.

More fundamentally, this move aligns Apple with the trend into what I have terms Third Generation CSR – from philanthropy to what we have known as CSR into the world of Shared Value predicted and outlined by Michael Porter just a year ago.  While at one level Fair Labor is simple CSR, the risk involved in this move suggests a far-sighted conviction that value in the future will lie much more substantially in the alignment of labor practices and product. I wonder whether Jobs would have made this move. It’s a huge risk. We shall all be watching . . . .