Corporate Social Responsibility Case Study Apple Computer

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Apple corporate social responsibility (CSR) programs and initiatives are led by Lisa Jackson, Vice President of Environmental Initiatives, reporting directly to CEO Tim Cook. It has to be noted that “Steve Jobs wasn’t known for philanthropy. Some wondered if he made anonymous donations to charity, some criticized him for his lack of public giving, while others defended him”[1]. However, with Tim Cook assuming Apple leadership in 2011, the focus on CSR aspect of the business was increased to a considerable extent. Tim Cook is a member of Paulson Institute’s CEO Council for Sustainable Urbanization, working with other CEOs of top Chinese and Western companies to advance sustainability in China.

 

 Apple CSR Programs and Initiatives

Apple Supporting Local Communities

  • ‘Global Volunteer Program’ was launched in 2011 to encourage employees to volunteer in local communities. Since its launch more than USD 78 billion was donated to charities and non-profits around the world.[2]
  • The program has been revised in March 2015 to grant employees the right to choose the projects in their local communities they would like to contribute.

Apple Educating and Empowering Workers

  • Apple education and development program is offered free of charge by 18 factories and more than 280,000 workers took various courses in 2016
  • Under the leadership of Denise Young Smith, as Apple’s vice president for HR, Apple has expanded its employee benefits programs to a considerable extent. For example, “expectant mothers can take up to four weeks before a delivery and up to 14 weeks after a birth, while fathers and other non-birth parents are eligible for up to six weeks of parental leave”[3]

Labour and Human Rights at Apple

  • Apple enforces The Supplier Code of Conduct that is claimed to be the toughest in the electronics industry
  • Company has achieved an average 95per cent compliance among suppliers to maximum 60-hour workweek
  • Apple has investigated cases of abuses of foreign workers and the company has required suppliers to reimburse affected “foreign contract workers USD3.9 million in excessive fees paid to labour brokers, bringing our total reimbursements since 2008 to USD16.9 million”[4]

Employee Health and Safety at Apple

  • The company has launched Apple Supplier EHS Academy, an 18-month program that aims to improve employee health and safety in the industry throughout the globe. 240 suppliers and 270,000 workers have participated in this program.
  • Research has been conducted in Apple’s ergonomics department on about 75 jobs within supply chain to identify ergonomic risks. The research has resulted in improved standards for managing workstation design changes.

Apple and Gender Equality and Minorities

  • Apple employees are 32 percent female, 9 percent black and 12 percent Hispanic. Out of a global workforce of 125,000, 37 percent of new hires in the last 12 months were women. Out of a U.S. workforce of 80,000, 27 percent of hires came from underrepresented minority groups in the last year.[5]
  • The company reached equal pay to employees in 2016
  • Tim Cook is the only openly gay CEO of a Fortune 500 company has been praised as a strong champion of workforce diversity[6]

Energy Consumption by Apple

  • Apple is often praised for its environmental records that include decrease of total power consumption of Apple products by 57per cent , introduction of Mac mini as the world’s most energy-efficient desktop computer and exceeding ENERGY STAR guidelines
  • Apple emerges as the only company that has been awarded with a Clean Energy Index of 100per cent , according to Greenpeace’s Clicking Clean Report.
  • Apple Inc is sourcing or generating enough renewable energy to cover 96% of the electricity used at its facilities worldwide
  • The company is now 100 per cent renewable energy in 24 countries. Each Apple data centre around the world runs on 100 per cent renewable energy
  • The multinational technology company has committed to bring 4 gigawatts of renewable power online by 2020

Water Consumption by Apple

  • The company launched Clean Water Program in 2013 and since more than 8 billion gallons of water have been saved by suppliers
  • Cooling systems in company’s date centres can reuse water up to 35 times
  • In 2015 the company converted about 120,000 square feet of previously grass lawns to drought-tolerant landscape, translating to estimated water savings of up to 6 million gallons per year
  • Despite the initiatives above, water usage by Apple data centres, retail and corporate facilities have been consistently increasing during the last three years, as illustrated in figure below.

Water usage by Apple Inc.[7]

  • Apple Park, a campus in Cupertino uses 75% recycled non-potable water. Apple campus in Austin, Texas, irrigates its drought-tolerant plants using a 600,000-gallon rainwater cistern.

Waste Reduction and Recycling by Apple

  • Apple offers recycling programs in 99 percent of the countries it operates and the company has diverted more than 508 million pounds of electronic waste from landfills since 2008.
  • In 2016 the company introduced Liam, a line of robots that can disassemble an iPhone every 11 seconds and sort its high-quality components so they can be recycled,
  • In 2015, more than 99% of Apple product packaging was done from recycled paper or papers sourced from sustainably managed forests.
  • Apple is working with more than 160 recycling companies around the world and in 2015 it collected nearly 90 million pounds of e-waste through its recycling programs.

Carbon Emissions by Apple

  • In 2016 Apple’s comprehensive carbon footprint was 29.5 million metric tons, compared with 38.4 million the year before. As it is illustrated in figure below, the company’s CO2 emissions per product has been consistently decreasing during the last four years to reach 97 kg in 2016.

Changes in Apple CO2 emissions per product (kg)[1]

  • The company offers employees more than 550 electric vehicle charging ports for free, an increase of 67 percent compared to the previous year to encourage the usage of electric vehicles
  • In 2016, the multinational technology company conducted 34 energy audits at supplier facilities, identifying more than USD55 million in annual energy savings opportunities.
  • Energy efficiency improvements introduced by Apple suppliers in 2016 eliminated the output of more than 150,000 metric tons of CO2 equivalents

Apple and Sustainable Sourcing 

  • More than 99% of paper used in packaging is prepared from recycled wood fiber
  • The company partnered with The Conservation Fund to protect 36,000 acres of sustainable forest in North Carolina and Maine and more than 13,000 metric tons of wood was harvested responsibly
  • Apple aims to contribute to transition up to 1 million acres of forest, across five southern provinces, into responsible management by 2020

Apple other CSR Initiatives and Charitable Donations

  • The company has planted more than 9000 drought-tolerant trees in Apple Park in Cupertino
  • In 2017 Apple donated USD 1 million to Southern California Wildfire Recovery Efforts
  • The multinational technology company raised more than USD 3 million for Hurricane Harvey Relief Efforts in August 2017

Apple Inc. Report contains a full analysis of Apple corporate social responsibility including Apple CSR issues. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Apple. Moreover, the report contains analyses of Apple leadership, business strategy, organizational structure and organizational culture. The report also comprises discussions of Apple marketing strategy and its ecosystem.

 

[1] Apple Support for Charity (2015) Available at: https://macrumors.zendesk.com/hc/en-us/articles/202084918-Apple-Support-for-Charity

[2] Gurman, M. (2015) “Apple launching volunteer program for employees to help local communities” Available at: https://9to5mac.com/2015/03/16/apple-launching-volunteer-program-for-employees-to-help-local-communities/

[3] Hodgkins, K. (2014) “Apple Expands Employee Benefit Programs in Health and Wellness, Education, and Philanthropy” MacRumors, Available at: https://www.macrumors.com/2014/10/02/apple-benefits-program/

[4] Apple Supplier Responsibility 2014 Progress Report

[5] Worstall, T. (2016) “Apple Reaches Pay Equality – Even If Every Company Did We’d Still Have Gender And Minority Pay Gaps” Forbes, Available at: https://www.forbes.com/sites/timworstall/2016/08/04/apple-reaches-pay-equality-even-if-every-company-did-wed-still-have-gender-and-minority-pay-gaps/#33a113e6779b

[6] Bort, J. (2015) “Apple’s HR chief: Working with Tim Cook ‘actually helps you to be a better human being’” Business Insider, Available at: http://www.businessinsider.com/apple-denise-young-smith-why-working-for-tim-cook-is-so-great-2015-7

[7] Source: Environmental Responsibility Report (2016) Apple Inc.

[8] Source: Environmental Responsibility Report (2017) Apple Inc.

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Case study: Apple Inc. and the challenge of a social responsible management

Nowadays, one of the main objectives for most of worldwide companies is to be recognized for its responsible management and ethical performance. On the one hand, citizenship seems to demand more from the private sector in terms of their responsibility to society. On the other, the globalization of information, supported on the development of new ways of communication, allows to know rapidly and without geographical limit.

In this sense, the achievement of a responsible management should be understood more as a process than as a result. Integrate CSR into the strategy of a business, requires a never-ending process of understanding, improvement, and monitoring (as in every strategic issue). And here is where not only companies fail, also society do.

Sometimes company’s just look for the result, it means to be recognized for its CSR (awards, reports, participation of indexes, standards, etc.) and sometimes society just look to specific problem (resulting from a business operation) asking for specific (sometimes simplistic) solutions.

I said all this to point out the complexity that, a case as Apple, brings when analyzing its performance in a doing good business perspective.

Apple is one of the most important worldwide companies; not only due to size (market, assets, etc.), but mainly because its contribution to the creation of a whole new industry with new products and services. Innovation is the biggest assets that Apple has and gives to society. It is the driver for the sector development and the basis for the economic development.

Furthermore, Apple created last year around 514.000 jobs in the US (1) , jobs that could be created in a different place under cheaper costs. This is a huge commitment to the local economy.

Because of its particular business model (the whole production is outsource) and the characteristic of its products, the main material issues for Apple could be summarized in two categories: environmental impact and supply chain management. These two issues are the focus of Apple’s efforts (and reports) and seems the base for the understanding in terms of CSR.

The environmental impact of their products is measured, managed and reported. Carbon footprint is the main tool used to identify where are major sources of emission in product’s life cycle and what actions should be taken, in order to improve efficiency, reduce cost and minimize negative impact. This is how a carbon footprint becomes a management tool for companies.

Moreover, the products are design to minimize its environmental impact, such as less energy consumption, small packages, recycling, etc. However, the responsible selection materials even it is state as a very important issue in which Apple is hardly working, there are many critics related not only to the danger of some materials used for iPads or iPhones, but also to the risk (and environmental and social impacts associated) to the extraction of raw materials use for the production. In this regard, Apple doesn’t mention anything.

In relation to supply chain, the challenge is huge. Apple has everything very well in paper. Their policies towards an ethical performance along the whole supply chain are very well explained, but less effectively achieve. The concerns go further the Foxconn scandal. The lack of good governance and strong institutions in where their operate added to the difficulty of control thousands of suppliers, relies high risk for Apple in terms of abusive labour practices and non compliance with law (the minimum).

It is true and fair to recognize the actions taken, such as trainings and audits, most of them done by a third-party (the Fair Labour Association) for the identification of gaps and comply with their policy. Nevertheless, there is too much work to do, especially in relation to the commitment and empowerment of the problem, reflected in a better management system for the supply chain.

Apple has the policies (the frameworks), the information and comprehension about their impact on society. The main challenge (to not say problem) relies in the management of that impact. Using Porter’s definitions, Apple seems to have a “responsive CSR”; it means, “acting as a good corporate citizen, attuned to the evolving social concerns of stakeholders, and mitigating existing or anticipated adverse effects from business activities” (2 ). In fact, Apple’s initiatives concerning the supply chain obey to the high-risk associate to its operation and also to the scandals and problems that the lacks of management result in. And this is essential for a responsible business.

Apple could have integrated CSR into its strategy. They are working on it (they are in the process), under this understating. It doesn’t mean that there are no challenges and things to improve.

In fact, they don’t seem to have CSR as add on, in the sense that they don’t develop any “social or environmental programme” outside from their business.
In this point, and before finishing, I want to point out a difference (appropriate to the case) between having CSR integrated into the strategy and strategic CSR.

There are many other issues outside the spectrum presented by Apple. For example, what is Apple’s social purpose? What makes Apple different from the other competitors besides very good-looking products and creative design? Integrating CSR into the strategy require not only a comprehensive and integral management perspective, also entails doing things different from competitors and create social value (strategic CSR). Maybe Apple gains in the product (result) differentiation (what we could see), but still be the same in the “hidden part” (social value of the product) than the rest of actors.

How to potentiate Apple’s products to promote social change? I mean to give to an iPad, for example, a different value, besides being a good for consumption. Technology is a vital tool for social change, for education and empowerment. What Apple can do about it? How to integrate these issues into their core strategy? Is it possible? Absolutely! If they could address this kind of questions; they could really make a revolution in the “CSR” arena as they did in the “consumption” arena. And here sleeps their main challenge and opportunity.

footnotes:
(1) Source Apple’s web page: www.apple.com/about/job-creation/
(2) Porter & Kramer. “Strategy and Society. The Link Between Competitive Advantage and Corporate Social Responsibility”. Harvard Business Review. December 2006.

No hay comentarios / 28 May 2012 por Diana Patricia Sanchez Barajas
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