I’ve written about this sort of thing many times in the past, so pardon the repetition. A new report came out (the PDF file is here), issued jointly by five China environmental groups, that discusses many of the pollution problems of the China electronics industry. Two companies in particular are taken to task: Apple and Foxconn. The Financial Times had an article on the topic, plus you can look at the coverage in most of the major papers.
While pressure on industry by NGOs can achieve real results, I still think of it as a sideshow, or a Plan B. Why? I worry that it takes some of the heat off of the folks whose primary responsibility it is to keep the air and water safe: the government.
Look, if I was working for a China-based NGO, I’d much rather write a report criticizing Apple than the government. The former gets you a great deal of press coverage, while the latter can result in serious legal consequences (e.g. getting arrested).
So I get the idea here. And I also understand that Apple has been particularly uncooperative. As the report highlights on page four:
During the past year and four months, a group of NGOs made attempts to push Apple along with 28 other IT brands to face these problems and the methods with which they may be resolved. Of these 29 brands, many recognised the seriousness of the pollution problem within the IT industry, with Siemens, Vodafone, Alcatel, Philips and Nokia being amongst the first batch of brands to start utilizing the publicly available information. These companies then began to overcome the spread of pollution created by global production and sourcing, and thus turn their sourcing power into a driving force for China’s pollution control.
However, Apple has become a special case. Even when faced with specific allegations regarding its suppliers, the company refuses to provide answers and continues to state that “it is our long-term policy not to disclose supplier information.”
At the same time, I understand what’s motivating Apple, or any other company faced with similar problems. Why is Apple being less cooperative than some of the other targets of these groups? Because the company has decided that it is better off not doing so. Period.
Let’s not pretend that these other companies are somehow more moral, or that their executives or Board are “taking the high road.” It’s possible, but I would be shocked if that were the case.
Companies make decisions based on their bottom lines, and when they decide to be “green,” in most cases, the company has been convinced that doing so is a good idea financially, or at the very least that doing so will not result in a significant hit to profits.
I agree with the Milton Friedman way of thinking about corporations. They exist to make money, and wistfully hoping that they will reflect some set of moral values is an exercise in futility.
Where I part company with Friedman, though, is advocating for vigorous government regulation. If companies will do whatever they can to avoid costs, then it is up to society (i.e. the government) to set out the rules for companies. These rules are the limits that we, as a society, place on company behavior. Government rule making is therefore an expression of our values.
For Apple and Foxconn, they are mostly just maximizing their profits within the system. I don’t mind that these groups are criticizing them, but I wish they could come up with a useful way to channel that energy into a safe way to lobby the government here towards better enforcement of environmental laws. While I admit the limits of NGOs in China, I also believe that government action is the only way to achieve systemic change.