Striving to Be Socially Responsible

Electronics manufacturers are notorious for poor working conditions in overseas factories, but some have made strides toward being more socially and environmentally responsible, according to a new report. TCO Development, a non-profit that provides international sustainability certification for IT products, says 17 brands have taken "corrective actions" under its guidelines to increase transparency and responsibility for implementing safe and ethical working conditions throughout the supply chain, as well as defined controls and benchmarks for further improvements.
"The purpose [of the designation] TCO Certified is to point out the 30-50% most sustainable products on the market, including socially responsible production, and incrementally drive the industry forward with revisions of the criteria every three years,’’ says Niclas Rydell, product and certification director at TCO Development, based in Stockholm, Sweden. A certification is good for two years and can be extended one year at a time until a new version of a product is released, he says.
Since social criteria were introduced in TCO Certified in 2009, "there has been an increased awareness and demand from buyers of IT products that [they] are produced in a more socially responsible way,’’ Rydell says.
A sustainable IT product is one that is safe to use and which does not have a harmful impact on the environment, Rydell says. TCO certification requires the production facility to be environmentally certified according to ISO 14001 , an Environmental Management Systems (EMS) standard. The factory also should not contain dangerous chemicals or substances that will impact the environment if burned or incorrectly recycled, he says. "TCO Development makes annual spot checks to verify that the factories are fulfilling the requirements,’’ Rydell adds.
The 17 brands are Acer, AOC, Asus, Benq, Dell, Eizo, Fujitsu, Hanns-G, Hewlett-Packard, Lenovo, LG, NEC, Philips, Samsung, Terra, and ViewSonic.

Corporate Activities

In October, Acer announced an initiative to purchase enough green power to offset 100% of its carbon emissions from electricity at all its U.S. facilities. The computer maker also utilizes product design principles that emphasize modularization, and components easy to dismantle and recycle, according to Eric Gilbert, manager of Acer’s Corporate Sustainability Office. Acer also emphasizes labeling that provides clear information about the use and recycling of plastics, and requires its suppliers to comply with these design requirements, Gilbert says.
Ease of disassembly tends to improves recycling efficiency and the value capture at the product’s end-of-life, he says. The same characteristics that make it easy to disassemble and recycle a product also make it easier to upgrade, he notes. For example, certain components are easy to replace without taking an entire computer apart, like memory modules, processors, and hard drives, Gilbert says. If a worn component can be replaced instead of trashing the entire unit, then the lifecycle has been increased.
In 2008, Acer became a member of the Electronic Industry Citizenship Coalition (EICC), an organization committed to supporting the rights and well-being of workers and communities worldwide affected by the global electronics supply chain, and "has been working on labor issues in the supply chain all along,’’ Gilbert says.
Asus also joined EICC in 2008, and has been using the organization’s standards to guide audits and manage supply chains, says GreenAsus chief quality officer Frank Lin. TCO certification is one way for customers to verify Asus products are sustainably designed and produced, he says. Examples of the company’s commitment to sustainability and green technology include its development of the world’s first halogen-free motherboards and monitors, as well as creation of the world’s first bamboo laptop in 2010, which was designed to bring awareness to protecting and conserving the environment, according to Lin.
Asus is also building partnerships "with notable third parties to ensure that our supply chains meet all of the ethical standards we’ve adopted. To provide a safe and healthy working environment throughout our supply chains, ASUS requires all suppliers to be in full compliance with the EICC Code of Conduct,’’ he says. The company assesses suppliers through annual onsite audits using the EICC Code. "If any non-compliance is identified, then a Corrective Active Plan is immediately set in place and follow-up protocols are established to ensure compliance."
HP also does "a pretty good job" of staying on top of environmental and social issues, according to Julie Fox Gorte, senior vice president for sustainable investing at investment management firm Pax World Management LLC. For example, earlier this month HP announced plans to expand its supply chain program to prevent exploitative labor practices.
"In terms of trends, you do see especially the more consumer-facing companies being very conscious of their image," Fox Gorte observes. Much of a computer company’s value is in intangibles, making it susceptible to consumer backlash if its computers are made by child labor, she says. "People want to feel good about the computer they buy. Brand image is increasingly important."

Battling Perceptions

Many large tech companies take measures to ensure they comply with sustainability criteria from environmental and labor perspectives, Fox Gorte says. "For the last five years, there has been a fairly widespread perception that were problems in the supply chain and sweatshops,’’ with allegations leveled at Taiwanese-based Hon Hai Precision Industry Co. over poor working conditions and suicides among workers at its Foxconn factories, she says. While progress has been made in some factories, Fox Gorte notes, "allegations of poor labor conditions and worker health problems don’t go away very fast."
Rydell agrees some improvements have been made since the Foxconn scandal, but says there is still much to do. "Many countries in Asia are competing to attract the industry, which creates a reluctance to solve these problems even from the governmental side, as it is often associated with costs for the factory owners." The most important change is that buyers are becoming increasing aware of the problems and are starting to refuse to buy products from organizations in which the social conditions in tech production have not been properly verified, he says.
Fox Gorte says while it is promising to see computer companies taking responsibility for labor conditions, end-users will increasingly pay attention to what goes into their products and to end-of-life (disposal/recycling) issues, resulting in an increasingly intricate regulatory environment.
"The underlying message is there are a lot of rules and regulations, but they only get tighter so you have to pay attention to how you make your stuff,’’ she says. "There is no place to hide. Someone on the ground is watching."

Esther Shein is a freelance technology and business writer based in the Boston area.