Whilst the current row over Apple’s warranty policy may well owe more to the government’s and Apple competitors’ desire to curb the company’s success in the Chinese market, the charges of arrogance are not completely unfounded: there is history here.
When in 2011, a consortium of Chinese civil society organizations exposed appalling labor and environmental conditions in the factories that made iPads and iPhones, following a seven month investigation, Apple refused to acknowledge the reports or to respond to the charges. Chinese civil society activists had been trying to raise these issues with Apple since 2010, without response. The attitude at Apple central seemed to be that any criticism was down to jealous competitors and that the company was too big to worry either about its workers or its environmental impact. It is, of course, quite possible that a different conversation was going on inside the company, but as far as the public was concerned, Apple stuck to the line that it did not disclose who its suppliers were, allegedly for commercial reasons. As one Chinese activist put it, if a factory is making iPhones, it would seem to be a reasonable bet that it was an Apple supplier. Still, Apple would not budge:
The investigators claim that, despite the information provided by the NGOs on environmental problems at as many as 27 suspected Apple suppliers, the U.S. firm did not respond to a single pollution incident in its 2011 Supplier Responsibility Report. Its only nod to questions from environmental groups was to admit that Wintek, where workers suffered n-hexane poisoning when cleaning iPhone touch-screens, was a supplier.
Apple’s attitude was reminiscent of the Nike response, long ago, to the revelations of child exploitation in their supply chain: this basically said that these were not their factories and they did not accept responsibility for what happened inside them. Nike paid a heavy price in reputational terms for that, and they have since had to work hard to rebuild their image. Apple did not seem to have noticed that standards of disclosure had risen since then. As the Chinese activists noted:
The latest NGO report accuses Apple of failing to respond openly to questions and … while this type of behavior used to be standard among international companies … practices have changed as greater transparency in China has increased access to environmental data. Many companies now use that information to prevent pollution from their global manufacturing base.
Non-disclosure remained Apple’s policy until the death of Steve Jobs. Since then, Tim Cook has taken a more open position and an invitation to Chinese NGO in October 2011 to discuss Apple’s factory conditions was a breakthrough. But it came more than a decade after most multinationals realised that refusing to discuss conditions and abuses in their supply chains was unacceptable, unethical and finally, bad for business as it calls into question the social license to operate. It had taken Apple the best part of two years to respond. In the current, different dispute, Apple may find it has fewer friends that it might have had, if it had woken up earlier.