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Managing Compliance Risks in the Supply Chain

Karen Kroll | October 23, 2012

Last week, China-based electronics manufacturer Foxconn, best known as the contract manufacturer of Apple iPhones, admitted that underage “interns” as young as 14 were found working at one its factories. Incidents and allegations of sweatshop-like conditions at Foxconn have caused constant embarrassment for Apple and other electronics companies.

Apple is hardly alone in having concerns of unethical behavior by suppliers. In August, the non-profit group China Labor Watch released a report stating that HEG Electronics, a major supplier to electronics giant Samsung, used child labor in its factory.

After the allegations surfaced, Samsung conducted its own audit, and while it said it did not find instances of child labor in the factory—some workers were under 18, but were over the legal working age in China of 16—it did find “several instances of inadequate management and potentially unsafe practices.”

Given consumers' growing awareness of the ways in which the...

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