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The bad news about the allegations against an Apple (Nasdaq: AAPL) supplier's operations in China -- assuming they're true -- is that after decades of action on the part of labor, environmental and religious activists, such conditions still exist in some markets.
The good news is that Apple is more likely than most corporations to take such charges seriously.
15-Hour Days
Over the weekend, a British newspaper, the Mail on Sunday, reported that a Chinese factory that manufactures iPods is essentially a sweatshop operation, with 15-hour days the norm for workers.
Employees live in dormitories that are off limits to outsiders, according to the Mail's account, and are paid as little as US$50 per month.
The factory is a contract supplier, which places Apple several degrees away from the purported violations. Reportedly, Taiwanese manufacturer Hon Hai Precision Industry actually employs the workers.
Apple's Response
As is typical in such situations, Apple issued a statement indicating that it is investigating the allegations.
"Apple is committed to ensuring that working conditions in our supply chain are safe, workers are treated with respect and dignity, and manufacturing processes are environmentally responsible," the company said.
"We do not tolerate any violations of our supplier code of conduct."
High-Tech Image
The apparel industry in general -- and Nike (NYSE: NKE) in particular -- is perhaps what first comes to mind when people think of overseas sweatshop labor. Nike, which initially resisted activists' requests to investigate contract laborers' conditions, eventually embraced the reforms necessary to initiate change.
The tech industry has largely escaped a national focus on its corporate practices -- with the exception of Microsoft (Nasdaq: MSFT). In part, that's because there has not been a concerted national effort to highlight any single company's operations, Pratap Chatterjee, executive director of CorpWatch, told MacNewsWorld.
"There have been local movements, of course, usually focused on recycling computer-related waste," he observed, noting that such a cause does not easily lend itself to sparking national protests.
Apple, which takes pride in its image as a good corporate and world citizen, would make an ideal focal point -- much in the same way that Google (Nasdaq: GOOG) and Yahoo (Nasdaq: YHOO) became targets of activist outcries after acquiescing to Chinese government requests for personal information about their users.
That is not likely to happen though, Chatterjee believes.
Limits to Sensitivity
Apple's sensitivity about its reputation places it in a unique position, he said.
"Apple is the computer of choice for activists, for the media, for students. It will do what it has to, to preserve its image."
Still, there are likely limits to how far Apple is willing to go to satisfy its socially conscious constituency, Chatterjee admits.
Several years ago, when the company introduced the candy-colored iMacs, environmental activists pointed out the colored plastic was difficult to recycle. Apple wasn't willing to change the design, Chatterjee recalled.
"It's one thing to be responsible and another to cut into sales," he remarked. The bottom line is that Apple will do what it takes to sell its products.
"That comes first," Chatterjee acknowledged, "but [Apple] is more responsible than most other companies."
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