When American manufacturers began to outsource their supply chains in the 1980s and 1990s, the entire industry changed forever. Businesses could benefit from getting cheaper supplies from factories that didn't need to adhere to the standards of American labor laws. Of course, as the decades passed, morally conscious consumers began to catch on.
Doug Guthrie, Dean of the George Washington University School of Business, wrote an article for Forbes about the changing ethics in the supply chain, and how companies are changing their relationships with their suppliers.
After discussing Nike's outsourced labor issues, he explored the decisions Apple has made after consumers learned about the condition of the infamous Foxconn facilities. He said that they addressed the problem head on, and set ethical standards for its suppliers.
"Apple is an exceptionally able company to walk the minefield of workplace standards at this moment in time," he wrote. "Arguably one of the most agile and intellectually authoritative corporations operating today, Apple has the creativity, reputation and scope to find solutions to workplace standards and compliance for contractors that have eluded many other companies."
Guthrie added that the computer conglomerate has the power to influence other companies and industries to follow their lead. If other organizations see that a company as prominent as Apple can be successful by making legitimate efforts to be socially responsible and ethical in the business world, they will probably follow suit.
The labeling industry plays a big role in supply chain integrity. A manufacturer can simply mask its outsourced suppliers that have poor facilities and underage laborers with incomplete label tracking and traceability. But, that spreads through the industry like a disease and affects companies that want to be morally sound.
If a label can't be tracked to its original source, businesses may be purchasing supplies from a distributor that got them from a terribly unethical factory. Universal label compliance is integral if we want to avoid further tainting the entire supply chain.