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How Apple, Foxconn, and others can address labor abuses in overseas factories

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So why do we keep seeing these stories, particularly among big brands that have been attempting to get a grip on their supply chains for years? One important reason is that, while auditing and inspections have called attention to the need for companies to address human rights abuses in their supply chains, these processes suffer from significant weaknesses and – on their own – do not solve the problem.

First, they do not address structural elements or root causes underlying labor violations. These include consumer demand for ever-better, ever-cheaper merchandise, and brands’ drive to meet (and, yes, create) that demand. This demand translates into pressure on suppliers.

Buyer companies’ sourcing practices (last-minute changes, cut-rate prices paid for items, unrealistically large orders in short timeframes) have been shown to exacerbate or even cause poor conditions and rights abuses in factories. Managers dare not refuse an order from a customer such as Apple or Nike.

Second, periodic inspections of the sort typically performed at these factories cannot catch or solve persistent and often “invisible” problems. Issues such as discrimination, sexual harassment, or violations of a worker’s right to form or join a trade union are much harder to detect in planned inspections or drop-ins.

Further, the inspections cottage industry has fostered fraud among some factory managers (who might, for example, coach workers on what to say to auditors). The system has created a tick-box mentality among brands, who want to be able to check off “inspection done,” when the situation on the shop floor is often too complicated to be captured accurately in spot checks.

Third, weak regulations in producing countries often led, in the first place, to multinational brands’ decision to source from those countries. And these lax regulatory environments play a fundamental role in the perpetuation of serious labor rights violations in these factories.

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