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Apple accused of environmental violations in China

Chinese environment groups have accused Apple suppliers in the country of systemic pollution, underscoring the pressures on one of the world's biggest companies as opposition is growing in China against environmental degradation as the cost for economic growth.

In a report released on Wednesday, five Chinese non-governmental organizations said the U.S. technology company was using suppliers with public records of environmental violations and taking "advantage of the loopholes in developing countries' environmental management systems."

The accusations escalate a standoff between Apple and Ma Jun, director of the Institute of Public and Environmental Affairs, a co-author of the report, which is threatening to damage Apple's image. The groups have sought to influence 29 big electronics brands over the past year to work with them on containing pollution in their supply chain, but singled out Apple, saying the company had been uniquely unresponsive.

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In a highly unusual move for Apple, the company changed that stance just hours ahead of the report's publication, inviting Mr. Ma to start a dialogue on his allegations. Mr. Ma said Apple told him some of the factories on his list were not the U.S. company's suppliers, but did not specify which ones.

Although Apple does not directly manufacture anything itself and does not disclose who its suppliers are – with very few exceptions – the Chinese environmental groups say they used public information and court documents to form a list of more than 20 Apple suppliers with records of environmental violations. These suppliers also supply other groups.

Global electronics brands outsource all or part of their manufacturing and components, and activists say that, because of the intense competition between suppliers and lax government regulation, global brands are the most able to influence the behaviour of their suppliers.

China's breakneck economic growth has been accompanied by widespread environmental degradation, and historically lax pollution rules have given Chinese manufacturers a cost advantage. However, tightening regulation by Beijing and growing awareness of environmental issues – most recently on display in a 12,000 strong protest in Dalian earlier this month – are slowly changing the trend.

Apple, whose chief executive Steve Jobs resigned last week due to ill health, has faced controversy over its suppliers in China before. In May, an explosion at a Foxconn factory in Chengdu producing the iPad 2 killed three workers and injured over a dozen more. In February, Apple said that 137 workers had been poisoned in 2009 by a chemical used to clean iPhone screens in a Wintek factory in Suzhou.

According to the report, in the eastern Chinese city of Kunshan, air pollution from two electronics factories prompted villagers to send their children to faraway schools. Villagers also say they have noticed increased cancer rates since the two factories, Kaedar Electronics (Kunshan) and Unimicron Electronics, were established, according to the report. Analysts said that Unimicron and Pegatron, the parent company of Kaedar, were suppliers to Apple, but could not confirm whether Kaedar was.

Apple did not respond to questions seeking to confirm whether individual companies mentioned in the report were its suppliers or not.

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"Apple is committed to driving the highest standards of social responsibility throughout our supply base," said Carolyn Wu, an Apple spokeswoman. "We require that our suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes wherever Apple products are made."

In its latest supplier responsibility report, the company said 2010 audits had found that 80 facilities were not storing or handling hazardous chemicals properly. Apple's report said the company required the non-compliant facilities to correct their hazardous waste handling, storage and disposal practices and to maintain documentation of these operations.

Kaedar declined to comment and Unimicron could not be reached.

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