Repercussions for Apple being “Assembled in China”?

Which is more important?

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The Railway River in the industrial zone of Songjiang, outside of Shanghai, has been nicknamed the “milky river” by the locals since Riteng, a subsidiary of Casetek, started operations in the area about two years ago. Casetek is, among other things, a manufacturer that produces Apple iPad casings. However, Apple is the company’s main customer.

A local worker said that the river turns white after the factory discharges its waste water and this can happen as often as once a week. Prior to the factory opening “there were fish and shellfish in the river that we used to eat. But now there are no fish at all,” said He Yinfang, an employee of the industrial park’s waste water treatment station.

The Songjiang district environmental protection bureau has summoned Riteng to a hearing to explain the situation. Casetek says that the discharge was from the “Chinese new year annual cleaning” meaning that the discharge is not a part of their usual manufacturing process and that this was “a mistake that staff made” during cleaning.

However, Liu Fengqiang, deputy director of the Songjiang district environmental protection bureau, is less than happy with this explanation. He said that the pollutants came from water used during the cutting and polishing process at the plant, and not from cleaning. This would mean that the discharges were not from the annual cleaning and instead stem from “a problem in their management,” said Fengqinag.

Should Apple bear at least part of the responsibility of making sure its various international suppliers are complying with local environmental regulations? Or, does the burden rest solely with the countries in which these manufacturers are located? What if Apple was to “vote with its feet” and find another manufacturer that would comply with environmental regulations? Would you be willing to pay more for Apple’s products if you knew that was the company’s policy?

Source: Financial Times

3 comments

  1. Apple has recently been in the news for the slowdown in demand for its products, most notably the iPhone 5. This has had ramifications in China, as Foxconn, Apple’s primary manufacturer has instituted a hiring freeze. This recent environmental leak is another story that brings scrutiny among MNE and their practices in industrialized nations. In this “outsourced” world, it is going to take a strong company, such as Apple, to lead the charge to push for enforcement of regulations from foreign manufacturers and subsidiaries. In general, these regulations in countries such as China, India, Indonesia etc. are not that strong to begin with. That is why it is interesting that Riteng is allegedly just ignoring the law in place. Perhaps they feel they need to do this to keep the iPad contact and it is worth the risk of having the Chinese authorities fine them.
    Businesses think in terms of profit. Apple should make sure their manufacturers comply with the regulations of the nation they are working in, if only to avoid the bad publicity that these stories create. No company wants their misdeeds splashed across the front page of the Wall Street Journal or the New York Times. I think Apple could definitely create a niche market for items created in a sustainable, environmentally friendly way. The markups on their items are already astronomical.

  2. I agree that Apple has the potential to become a leader in enforcing environmentally friendly manufacturing practices. It saddens me to hear that a river that was once abundant with aquatic life is now deemed the “milky river” because of the extent of the pollution from the factory’s discharge. Not only is this sad because of the environmental damage to the area, but it also has most likely had a negative effect on the local economy in Songjiang. I also agree that Apple should bear at least part of the responsibility of making sure its foreign manufactures are complying with local environmental regulations. For a company that has changed the world with its technological advances, asking everyone to “think different,” I would hope that Apple would lead the way in reducing their negative environmental impact.

    Even though Apple products are already expensive, I for one would be willing to pay more for Apple’s products if I knew that the company was using a manufacturer that does comply with environmental regulations or lessens its carbon footprint.

  3. It is very difficult to draw the line on how much responsibility a customer like Apple has. According to the diagram in the Financial Times article, it looks like Apple has conducted many audits of its suppliers to ensure compliance with environmental regulations. However, it looks like each year the findings are getting worse and worse. It seems there is more that Apple can do. Instead of leaving every supplier that has questionable compliance with environmental regulations for one with better compliance, maybe Apple could subsidize some of the suppliers to help them improve their safety compliance. Such an investment would improve Apple’s image, and help save the communities that are being negatively impacted by things like the “Milky River”. While the numbers would have to be analyzed to see whether an option like this is viable, every company directs its corporate social responsibility dollars somewhere, so why not use them to help the communities and companies that support your business.

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