Business Ethics in the Electronics Industry - Coursework Example

Business Ethics Table of Contents I. Introduction 3 II. Discussion 3 III. Conclusion 9 References 10 I. Introduction This paper discusses the ethics of the electronics devices business, as it pertains to the manufacturing outsourcing practices of leading electronics brands such as Apple, and how some manufacturing subcontractors have been flagged for questionable business practices that include unfair treatment of labor, the use of minors, and low wages. Apple is joined in this regard by a slew of other electronics manufacturers, including Lenovo and Dell, who utilize subcontractors in the Far East in order to reap the benefits of reduced costs from such outsourcing arrangements. Many quarters are questioning the ethics of using such subcontractors in the face of allegations of such human rights abuses and failing within the factories of the subcontracting parties. This too, given that Apple for instance had been reaping large profits from the global sale of its products. There are studies that note that the electronics sector, in particular, have been among the worst human rights violators in the world, topping other traditional transgressors of human rights as they pertain to labor rights, such as mining and textiles (Hachnan, 2012; Wagstaff, 2012; Mims, 2012). II. Discussion A report coming out of the MIT Technology Review in 2012 showed that among different industries, electronics have been singled out as the worst violators of labor rights int eh world, topping the record of textiles, mining, and a few other traditional industries that have been noted for poor labor practices. Part of this, the report says, is based on market dynamics. There is a need for electronics subcontractors and big-name brands such as Apple and Hewlett-Packard to make manufacturing processes conform to the dynamics of a market where cellular phones and other electronics have short life cycles and become obsolete at very short time frames, usually within the space of a few months. Practices that essentially reduce inventory risks by manufacturing to demand, and ordering the supply chain to be so configured that products are delivered just in time, translate to pressure on the part of the manufacturers and subcontractors to squeeze maximum productivity from workers at the lowest costs. This in turn translates to workers being fired and hired as needed, to conform with changes in demand and in production for various electronic devices, long work hours, low wages, and poor working and living conditions. The competition among subcontractors too mean that electronics industry workers have to accept low wages all around, and that the excess in the supply of workers relative to demand means that workers meanwhile have little to no leverage in terms of being able to haggle for better wages and better living conditions. The consequences are the institutionalization of grave worker abuses that amount to rampant exploitation. The absence of mechanisms to subvert these exploitative practices via big-name players like Apple and Microsoft funneling parts of their profits to improve worker conditions means that the conditions of exploitation persist. Moreover, given the competitive nature of the global electronics sector, where managements of Apple and others are answerable to its shareholders, who demand high profits, there is little recourse for ordinary workers to get their fair shake in terms of better living and working conditions, better working hours, and better living wages. In other words, in an industry where the roots of the unfair labor practices are very deep and complex, the question of who should be held accountable in terms of the ethics of labor practices in the industry is not easy to single out (Hachman, 2012; Wagstaff, 2012; Mims, 2012; Heffernan, 2013). The human toll of this ethical discussion is large and profound. Foxconn had been in the news for some time not only with regard to the large profits that it had been making manufacturing electronics for Apple in particular, but also because the labor problems and the human suffering in the Foxconn factories exemplify the kind of abuses and labor problems that plague the industry as a whole. Foxconn was reported to have made $3.2 billion dollars in profits in 2013, and its revenues ranked it number 40 in the listing of the top 500 companies in the world, but confirmed reports from many sources tell of stories of successful and failed suicide attempts at the factories themselves. This is owing to a confluence of factors that essentially trace their roots to a lack of concern for worker welfare. On the one hand we have the successful parent company making profits out of the labor of workers who are treated badly, and on the other we have the concerns of the shareholders who want to squeeze maximum profits from the firm, with no apparent regard for fixing what ails the factories on the labor front. The suicides meanwhile are indicative of the gravity of the malaise within the factories, where workers seem wedged between the pressures of working for a living on very low wages, while at the same time finding themselves working in what amounts to inhuman working conditions that drive them to despair and to suicide. The stories from the factory floor tell of the human dimension of this ethical debate. In an environment where a few big companies profit while the masses of the laborers who churn out the electronics suffer and die, is there room for ambiguity with regard to what is ethical and what is not? From a utilitarian point of view, one can say that if the end that is pursued is the maximization of profit to benefit the shareholders, then the means, which is the exploitation of labor, is justified. On the other hand, from the point of view of a Kantian view of ethics, where people must be treated as ends in themselves rather than as means to an end, then obviously there is something amiss here ethically, because the workers are being exploited in the name of corporate profit (Hachman, 2012; Wagstaff, 2012; Mims, 2012; Heffernan, 2013; ONeill, n.d.). Pushing the discussion further, from the point of view of Kantian ethics, one can make a case for seeing the situation in the electronics industry as one of whether the current practices can be justified as being universally valid at all times and in all cases. Obviously, where workers are exploited in the name of profit, to the point where workers turn suicidal from a host of factors that are inhuman, degrading, and despair-inducing, that these conditions cannot be made a universal template for any industry and for any humane undertaking. While it is true that the industry itself is beset by pressures and factors from market forces that compel them to seek out the lowest costs and the maximum efficiencies for manufacturing the electronics products, it is also true that industry practitioners, Foxconn and Apple, are also answerable to workers and to the general human community with regard to how they are transgressing human rights in the name of profits. From a Kantian ethical perspective, this maxim of pursuing profit at whatever human cost is unsustainable and cannot be made a universal law. That being the case, then one must say from a Kantian ethical perspective that the current conditions and practices by Foxconn, Apple and other major players in the industry are not ethical (Hachman, 2012; Wagstaff, 2012; Mims, 2012; Heffernan, 2013; ONeill, n.d.). The discussion of the ethics of the business practices of Apple, Foxconn, and other large corporates who utilize subcontractors for the manufacturing of electronics that feed their large profit machines therefore boils down, from one analysis, into a consideration of the business ethical issues from either a utilitarian perspective or a Kantian perspective. On the one hand, the low cost manufacturers do the world a great service by being able to provide essential electronic such as computers and cellular phones at costs that allow a large number of people to make use of them to better their lives, all while providing enough profits for the big designers such as Apple to make it worth their while to pursue innovation that further help propel progress in this space. Then too, the valuable service of Foxconn allows shareholders to make it worth their while to continue to invest in Apple and Foxconn, allowing the big corporates to continue to plow back profits and share price appreciations into making better products. That a few suffer as a result is from a utilitarian perspective unfortunate, but given that the arrangement benefits a larger majority of the worlds population, then the suffering is something that can be tolerated to a certain extent. This is the conclusion from a utilitarian ethical point of view, where the securing of the happiness of the greatest number of people is the ethical standard. On the other hand, as has been discussed above, from a Kantian ethical perspective the ethics of an industry that reaps maximum profits at the expense of the suffering of its workers cannot be justified. These practices amount to making workers less than human beings who must be treated as ends in themselves, something that violates a core tenet of what human rights is for Kant. The other litmus test that the industry fails is that its practices cannot be made into universal laws that apply in all cases, because in the end there can be no justification for an industry that has institutionalized suffering as a standard way of doing business (Hachman, 2012; Wagstaff, 2012; Mims, 2012; Heffernan, 2013; ONeill, n.d.). III. Conclusion The reality is that as a report notes, the electronics industry has bred a unique set of business dynamics that have been detrimental to worker welfare, to the point where it has surpassed some traditional industries such as mining and textiles as the worst in terms of labor conditions and the transgression of human and labor rights. Poor working conditions and low wages are the result of market forces partly, but it is difficult to comprehend that might corporations such as Apple cannot do something to improve worker conditions, if it made more earnest and sustained moves to do so. Moreover, there are industries where conscious choices that favor workers have resulted in improved working conditions and better life outcomes for workers. At present though, the repressive labor practices can only be justified from a utilitarian ethical perspective, but not from a Kantian ethical perspective that posits respect for all human beings and for giving workers their due in terms of human and labor rights. From a Kantian ethical perspective the labor practices of the electronics industry, and of Foxconn and Apple in particular can be construed as being unethical and in violation of the rights of the workers (Hachman, 2012; Wagstaff, 2012; Mims, 2012; Heffernan, 2013; ONeill, n.d.). References Hachman, M. (2012). Report: Apple Still Ignoring Labor Abuses in Favor of Profits. PC Magazine. Retrieved from http://www.pcmag.com/article2/0,2817,2399395,00.asp Heffernan, M. (2013). What happened after the Foxconn suicides. CBS News. Retrieved from http://www.cbsnews.com/news/what-happened-after-the-foxconn-suicides/ Mims, C. (2012). Electronic Makers Have Worst Labor Practices of Any Industry, Says Report. MIT Technology Review. Retrieved from http://www.technologyreview.com/view/426565/electronics-makers-have-worst-labor-practices-of-any-industry-says-report/?ref=rss ONeill, O. (n.d.). A Simplified Account of Kants Ethics. Morrisville State College SUNY Morrisville. Retrieved from http://www.morrisville.edu/ Wagstaff, K. (20112). This American Life Revives Debate over Apple Manufacturer Foxconns Labor Practices. Time Magazine. Retrieved from http://techland.time.com/2012/01/10/this-american-life-revives-debate-over-apple-manufacturer-foxconns-labor-practices/ Read More