Suicides cause review of electronics sector supply chain

Foxconn — a major supplier to many of the world’s top electronic gadget manufacturers, including Apple, Dell, Nokia and Hewlett-Packard — recently announced it would raise salaries for assembly workers at its production base in southern China by 66 percent to 2,000 yuan ($293.30) per month as of October 1. The decision comes after 10 workers killed themselves and three attempted suicide at the plant this year. Apple, Dell and Hewlett-Packard, whose own corporate images are at risk from the suicides, have all announced their intention to look into Foxconn’s working conditions.

Some commentators have described Foxconn as a “Nike moment” for electronics manufacturers who still have much to learn about sourcing suppliers. During the 1990s, Nike faced global outcry over conditions at its manufacturing facilities in Asia.

In recent years, competitive pressures and increasingly discerning consumers have forced corporations to increase the number of suppliers they work with and the global destinations from which they source products. Given the large number of suppliers involved in the supply chain, the growing social conscience of consumers, the emergence of the 24/7 news cycle and growth in social networking, the likelihood of brand and reputational damage as a result of poor social and ethical performance in the supply chain is greater than ever before.

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