Apple CEO Cook Responds to New York Times Report

Much of the enthusiasm and awe directed towards Apple (NASDAQ:AAPL) earlier this week over its earnings report was tempered in the last day after a damning exposé was published in the New York Times that called attention to the harsh working conditions at Apple’s leading parts and product manufacturer, Foxconn.

The very vivid and at times deeply chilling article predominantly described an explosion at a factor that produced iPad cases, and described an incident where the parents of a 22 year old worker were gruffly told that their son was sent to the hospital.  The article, which came days after a major Times piece that described why Apple, in contrast to its policy years ago, makes nearly all of its products overseas.  The simple answer was the almost insane level of low cost productivity that simply couldn’t be duplicated in the American workplace.

The follow up piece claims that that productivity has come with a very high price.  Many incidents cited included mass accidental poisonings, factory explosions that killed four people and injured dozens more, and the working conditions most employees are subjected to.  Those conditions, according to the Times, included seven day work weeks, with employees working 12 hour shifts and living in overcrowded dormitories for very low pay.  Perhaps most troubling for the company’s standing specifically, the report quoted many former executives for both Apple and Foxconn that insinuated that though Apple publicly professes to care about worker safety, those concerns fall by the wayside in regards to maintaining levels of production.  A Foxconn executive was quoted as saying: “Apple never cared about anything other than increasing product quality and decreasing production cost.”

Though Cook did not reply publicly, he has sent out …

a long email to all Apple employees that essentially denies the charges and reasserts that Apple is primarily concerned about the well-being of all of its workers at every stage of production.

“We care about every worker in our worldwide supply chain. Any accident is deeply troubling, and any issue with working conditions is cause for concern. Any suggestion that we don’t care is patently false and offensive to us. As you know better than anyone, accusations like these are contrary to our values. It’s not who we are. For the many hundreds of you who are based at our suppliers’ manufacturing sites around the world, or spend long stretches working there away from your families, I know you are as outraged by this as I am.”

Nevertheless, while asserting to the fallacy of these claims and trumpeting how Apple has made tremendous improvements in the last year compared to other companies (“we’ve made a great deal of progress and improved conditions for hundreds of thousands of workers”), Cook may also be tacitly admitting that there is vast room for improvement.  Cook went on to state that ““We will continue to dig deeper, and we will undoubtedly find more issues. What we will not do — and never have done — is stand still or turn a blind eye to problems in our supply chain. On this you have my word.”

Cook also emphasized that company has a program devoted to educating workers to their rights and that encourages the reporting of workplace violations. After blowing away earnings expectations earlier this week, Apple once again became the most valuable publicly traded company in the United States.