Workplace

Apple’s China problem–and ours

February 5, 2012

More than a decade after the Nike scandals of the late 1990s exposed terrible working conditions in the Asian factories where most of our stuff is made, has anything changed? To be sure, in the years since, most US brands — not just footwear and apparel companies like Nike, Timberland and Gap, but corporate giants like GE and Walmart — have assumed responsibility for human rights and environmental problems throughout their supply chains. But are conditions any better for the workers?

Those questions are front-page news these days, literally, in The New York Times, which has published two long and extraordinary stories about Apple and its supply chain in China. [See How the US Lost Out on iPhone Work and especially In China, Human Costs are built into an IPad.] The Apple-in-China story is also brought to life by Mr. Daisey and the Apple Factory, a lively, provocative episode of public radio’s This American Life, in which an actor-turned-reporter  named Mike Daisey investigates conditions at a Foxconn factory in Shenzhen. Together this reporting paints a shameful picture of harsh and unsafe working conditions at Apple suppliers: sometimes deadly safety issues, chemicals that scar people’s hands, 60-hour weeks, long stretches of work with no breaks, a rash of worker suicides, etc. To get some perspective, I spoke with Dan Viederman, the executive director of Verite, a nonprofit that helps companies build more humane and sustainable supply chains, and I’ve been reading my friend Adam Lashinsky’s excellent new book, Inside Apple.

Foxconn offers medical care on its campuses

For starters, let’s be clear: This is not an Apple problem. The focus of both The Times’ reporting and Mike Daisey’s story is Foxconn, which is said to be China’s biggest private employer and may be the world’s largest manufacturing company. It employs 1.2 million people (!) and assembles an estimated 40 percent of the world’s consumer electronics, for customers including Amazon, Dell, Hewlett-Packard, Nintendo, Nokia and Samsung, according to The Times. Part of a company called Hon Hai that is headquartered in Taiwan, Foxconn operates not just in Asia, but in the Czech Republic, Mexico and Brazil. It publishes a corporate social responsibility report and has US-based employees in Houston and Austin, TX.  Most Americans, of course, have never heard of Foxconn although they probably own something that was made by the company. [click to continue…]

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And you thought G.I. Joe was already green…

December 8, 2011

GI Joe has been green since 1964, when the action figure first went into battle for toymaker Hasbro.

Now his plastic and cardboard packaging will be environmentally-friendly, too.

So will the packaging for such beloved toys and games as Mr. Potato Head, Play-Doh, Monopoly and Candyland, all of which, along with more recent phenomena like Littlest Pet Shop and  the Transformers, are made by Hasbro, a Pawtucket, RI-based firm that sold about $4 billion of toys last year.

Hasbro releases its first corporate social responsibility report today, and it should be available here. The company offered me a preview of the report and a chance to talk with Brian Goldner, the company’s CEO, and Kathrin Belliveau, vice president of corporate responsibility at Hasbro. [click to continue…]

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Elizabeth Grossman: Chronic polluters also put workers at risk

November 25, 2011

Elizabeth Grossman

Today’s guest post comes from Elizabeth Grossman, a gifted environmental journalist who is the author of Chasing Molecules: Poisonous Products, Human Health, and the Promise of Green Chemistry, High Tech Trash: Digital Devices, Hidden Toxics, and Human Health, and other books. Her work has appeared in Scientific American, YaleEnvironment360, The Washington Post, The Nation and Grist. I met Lizzie this past fall at the Society of Environmental Journalists (SEJ) conference; she’s been writing about science and the environment for more than a decade.

She reported this story by taking EPA data uncovered by the Center for Public Integrity, and checking it against publicly-available information from OSHA. Her story got my attention because it suggests (based on admittedly limited evidence) that companies that are careless or irresponsible about air pollution also have workplace-safety issues. I wasn’t surprised to see BP among them–my FORTUNE colleagues David Whitford and Peter Elkind did a great job dissecting its culture in BP: “An Accident Waiting to Happen.’  Seeing DuPont on the list did surprise me, since the company is known for its safety culture. This story first appeared at The Pump Handle, a website about public health and the environment.

We have learned from Environmental Protection Agency (EPA) documents obtained under a Freedom of Information Act request and released by the Center for Public Integrity earlier this month that there are currently about 465 United States industrial facilities on what the EPA calls its “watch list.” The list is made up of businesses EPA considers chronic violators of the Clean Air Act – but against which the agency has taken no formal enforcement action. An examination of these same companies’ occupational health and safety records reveals them also to be chronic violators of Occupational Health and Safety Administration (OSHA) standards.

These “watch list” facilities are located all over the country, but many are clustered in historical manufacturing hubs in the Midwest, Southeast, and along the Gulf Coast. Nearly all can be described as heavy industry. They include petroleum refineries and facilities making chemicals, cement, paper, paint, pharmaceuticals, and metal products, along with waste treatment (landfills, recycling, and incinerators) facilities, meat processing plants, mines, pipelines, a shipyard, and automotive plants. OSHA typically inspects about one percent of the United States’ 8 to 9 million workplaces annually, but more than 70 percent of the “watch list” companies have received OSHA inspections over the past ten years. Those without inspection records included US military facilities and mines that OSHA is not authorized to inspect, as well as a number of public facilities and utilities: municipal landfills, water treatment plants, and generating stations.

Overall, the OSHA inspection reports for the EPA “watch list” companies reveal what for many of these companies appears to be a history of chronic OSHA violations. Some of these companies had dozens of violations over the past ten years; a few had more than 100. (To round out the picture of these companies’ operations, I included both the specific “watch list” facilities and the individual companies’ comparable operations in other locations.) Among the companies with the most recorded OSHA violations at their various facilities around the country was BP Products, with more than 400 at facilities nationwide – violations that included 314 in one inspection record following the 2005 explosion at BP’s Texas City refinery that killed 15 workers. (The Deepwater Horizon incident does not yet appear in BP’s OSHA inspection records.) International Paper was cited for more than 295 violations, while Republic Engineered Products (part of Republic Steel) had more than 170 violations, various divisions of DuPont nationwide received more than 130 citations for OSHA violations, and the Greif company, manufacturer of packaging materials, was cited for about 100 violations nationwide in the past decade. Wheeling Pittsburgh Steel exceeded 100 violations since 2001, and Weyerhaueser‘s various divisions around the country were cited for more than 300. [click to continue…]

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REI’s Sally Jewell at Net Impact

November 5, 2011

Sally Jewell – 2011 Net Impact Conference from Net Impact on Vimeo.

Sally Jewell, the chief executive of REI,  is the most unpretentious big-company CEO I know. When we first met a couple of years ago for dinner in Washington, she arrived in toting an REI backpack (made from recycled material). She’s plain-spoken, direct and a good interview.Her company, as you might expect,  is committed to minimizing its environmental footprint. (Without  a healthy planet, there’s no business for REI.)

So I was delighted when Sally agreed to a keynote interview at the 2011 Net Impact conference last week in Portland. We talked about how REI has lowered its energy and GHG emissions while adding stores, about the (unfair) competition from Amazon and about how ideas percolate up, down and around the retailer.

Some 2,600 people attended the New Impact confab which, as always, was a great event. I’m only slightly biased, as a board member of Net Impact; the organization’s mission is to inspire and equip young people to use the power of business to make a more just, sustainable world. You can hear more about Net Impact on the video below from Liz Maw, Net Impact’s executive director.. The interview with Sally is nearly an hour long, but I’ve posted it here, figuring that at the least REI employees may want to watch.

And, if you are one of those people who plans ahead, please mark your calendar for the 2012 Net Impact conference on Oct. 26-27, in Baltimore, MD.

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Campbell’s Doug Conant: “How can I help?”

October 27, 2011

Douglas Conant

Ten years into his career in the food industry, Douglas Conant was fired from his job at General Mills. He had two small children, a big mortgage, and a feeling of bitterness. Then he called an outplacement firm where the man on the other end of the line answered as he always did: “Hi, it’s Neil McKenna. How can I help?”

That moment–in a new book, Conant describes it as a “touchpoint”–shaped his approach to leadership. “Leadership isn’t about you,” he says. “It’s about them.” McKenna became a mentor and friend, and Conant saw how seemingly small interactions can have a deep impact on people. He went only to a long career at Kraft, Nabisco and as CEO of Campbell Soup, where he led an impressive turnaround before retiring in July.

I met Conant this week in Washington to talk about his 10 years at Campbell and about the book. In Touchpoints: Creating Powerful Leadership Connections in the Smallest of Moments (Jossey-Bass), Conant and his co-author, consultant Mette Norgaard, argue that “the daily interruptions that leaders face in nearly epidemic proportions are actually the moments where the greatest leadership opportunities lie.”

They write:

Each of the many connections you make has the potential to become a high point or low point in someone’s day. Each is an opportunity to establish high performance expectations, to infuse the agenda with greater clarity and more energy, and to influence the course of events. Each is a chance to transform an ordinary moment into a Touchpoint.

“The soft stuff is the hard stuff,” Conant likes to say. [click to continue…]

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Rotten tomatoes

July 20, 2011

I’m going to try to never again buy a supermarket tomato.

Partly that’s because they have so little taste–a sad fact I’m reminded of every summer when we buy our tomatoes at a local farmer’s market. Any resemblance between a locally-grown tomato and  the industrial tomatoes sold in supermarkets and restaurants, particularly in winter, is strictly coincidental.

Mostly, though, it’s because I now understand what goes into the production of a tomato in Florida–the nation’s No. 1 tomato-growing state, which supplies virtually all of the fresh, field-grown tomatoes sold between October and June. That’s thanks to a terrific new book called, appropriately, Tomatoland: How Modern Industrial Agriculture Destroyed Our Most Alluring Fruit.

This eye-opening expose by veteran food writer Barry Estabrook, who formerly contributed to Gourmet, now writes for The Atlantic and blogs at his own site, Politics of the Plate, is a worthy addition to the growing number of books on my shelf that takes us behind the scenes of today’s alimentary-industrial complex, books like Michael Pollan’s Omnivore’s Dilemma, Eric Schlosser’s Fast Food Nation and Paul Greenberg’s Four Fish. From bookstores to the blogosphere, food writing these days is smarter and more tough-minded than ever. [click to continue…]

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Let’s do away with CSR

July 10, 2011

Maybe it’s time t0 do away with corporate social responsibility (CSR).

Not merely the words and the idea but the infrastructure: CSR departments, CSR reports, CSR conferences and CSR executives.

And, as long as we’re at it, let’s think about ditching the triple bottom line, the pursuit of shared value, corporate citizenship and especially, yuk, the idea that stakeholders deserve a say in how to run a business.

All of these are, at best, distractions and, at worst, ways of thinking about business that create a separation between a company’s core business and its impact on the world. Both ought to be life-enhancing. No more and no less.

I’ve been thinking about CSR and how to talk about it for years.  I wrote my first article on corporate responsibility for FORTUNE in 2003. It ran under an odd headline — Tree Huggers, Soy Lovers and Profits — because my editors knew that  words like corporate social responsibility turn off readers. I grappled with the meaning and terminology of CSR again in my 2004 book, Faith and Fortune, which explored connections between religion, faith, values, spirituality and business. The language of faith and values, I subsequently decided, wasn’t the best one to use when speaking to corporate executives about business and its impact. I’m now inclined to talk about sustainability. For all its vagueness, corporate sustainability is an idea that is both practical–no one wants to kill their company–and radical, because no company  is truly sustainable, at least as defined by the Bruntland Commission as promoting development in a way that “meets the needs of the present without compromising the ability of future generations to meet their needs.”

But the here goes beyond language. I was reminded of that when reading an excellent new book by Carol Sanford called The Responsible Business: Reimagining Sustainability and Success (Jossey-Bass, 2011). No, I don’t love the title or even her terminology. (One chapter is  called, yikes, “Stakeholders as Systemic Collaborators.”) But Carol’s arguments and insights (and the title wasn’t her idea) are spot on. Carol argues that the most successful and profitable businesses, over time, will not be those that “practice CSR” but instead those that rethink their purpose, reorganize themselves to draw upon the creativity and passion of all, and integrate responsible behavior into the way they do everything they do.

As Carol writes:

Responsibility isn’t a set of metrics to be tracked or behaviors to be modified. It is central to both the purpose and prosperity of a business and must be pervasive in its practices.

This may sound obvious but it leads her (and her readers) to new ways of thinking about business. Businesses, she says, should strive not just to minimize the harm they do, but to do good, to become restorative, to “improve and evolve healthy systems.” She explains: [click to continue…]

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Timberland’s Jeff Swartz: “This is hard.”

June 14, 2011

It’s the end of an era at Timberland, one of the most socially-responsible companies in America.

Family-owned since it was started in 1953 by Nathan Swartz, the grandfather of the current ceo, Jeffrey Swartz, Timberland  is being sold for $2 billion to VF Corp. VF is one of the world’s largest clothing and shoe companies; its brands include The North Face, Vans, Wrangler and JanSport.

What this means for the New England company’s well-known commitment to environmental responsibility and social justice remains to be seen.

Uncertain, too, is the future of  Jeff Swartz, perhaps the most passionate advocate in corporate America for the idea that companies have a moral obligation not only to generate wealth for shareholders but to do good for the world.

“This is hard,” says Jeff told me when we spoke yesterday. [click to continue…]

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Best Buy CEO: Sustainability is all about people

April 11, 2011

Best Buy’s in a tough business. The electronics giant ($50 billion in revenues in 2010) competes with Amazon, the best of the online retailers, and Walmart, the world’s biggest bricks-and-mortar retailer. The company’s shares have fallen lately.

What’s Best Buy’s competitive advantage?

It’s the people in the blue shirts, says Brian Dunn, Best Buy’s chief executive. “Our business is utterly dependent upon getting those 180,000 people aligned and moving forward,” he says.

This is why sustainability is important to Best Buy, the 51-year-old chief executive says. It’s about providing those people with opportunities, making sure they are heard and showing them that Best Buy cares about them and their values.

Brian gave the keynote speech this morning at the Boston College Corporate Citizenship Conference, which is being held in Minneapolis, Best Buy’s home town. We spoke briefly after his talk, which wasn’t your typical speech about sustainability or corporate responsibility. I don’t believe he mentioned the words “carbon footprint.” Instead he talked, in a personal way, about Best Buy’s people, their  aspirations, how they connect to sustainability and how he connects to them. [click to continue…]

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So you want to work in solar?

April 4, 2011

To my surprise, I’ve become visible enough in the world of “green business” that students and young professionals  frequently approach me because they want to learn more about sustainability, corporate responsibility or clean energy. Unfortunately, I can’t take the time to speak with all of them, so we typically exchange a couple of emails, and that’s it.

Leo Xiao

Occasionally, though, the student is unusually persistent, which is how I found myself having breakfast this morning at 6:45 a.m. in Laguna Niguel, Ca., with Leo Xiao, a 30-year-old immigrant from China who is studying for an MBA at UCLA. I’m here for FORTUNE’s Brainstorm Green conference, which begins later today, (Monday, April 4) and is available online here.

In any event, Leo Xiao learned that I would be in California for the event. He invited me to speak at UCLA. No thanks, I said. He offered to drive me from LAX to Laguna Niguel so we could talk. That won’t work either, I said. He offered to pay me $200 for a meeting, Absolutely not, I told him. But he was so relentless that I agreed to meet with him if he wanted to drive the 65 miles or so from LA to Laguna very early in the morning, which, not surprisingly, he did.

“Once I decide I want to learn something, I’m pretty committed,” he told me, unnecessarily. “I’m single minded.”

We had a good talk. Leo’s interested in the business of delivering and financing solar energy for homes, and he wanted to dig into issues surrounding the business model, management and risks associated with several start-ups that deliver solar to the home–Sun Run, Solar City and Sungevity. He asked a lot of good questions. It turns out that he’s working on his own iPhone app about solar for the home, but he couldn’t say much about it because he’s in “stealth mode.” Leo has a degree in computer science from UC Riverside, and he spent about a year and a half working at Zynga, the social gaming company the developed Farmville, before business school. He told me, proudly, that Zynga had used its platform to raise money for earthquake victims in Haiti. “Social games can be about more than killing time,” he said. “They can have a social benefit.”

I tell this story for a couple of reasons. First, I want to recognize Leo’s persistence, preparation and desire to learn. Second, I want to say that any immigration policy that makes it hard for people like Leo to work in the U.S. is nuts. He’s been educated here and would like to stay–”I love Silicon Valley,” he told me–and surely his brains and energy will add value to our economy. Free labor markets, like free trade, generate wealth and growth.

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