Apple is being forced to confront two new facets on existing risks.
First, there is something of a small tempest brewing over ethical standards in manufacturing at Apple’s iPad assembler, Foxconn. The company which has factories which employ many tens of thousands of workers, often housed in dormitories, has been accused of sub-standard working conditions. A rash of suicides, by employees jumping off the building roof, led management to, among other things, install netting. Apple, long a promoter of Corporate Social Responsibility (CSR) standards, has agreed to bring some external inspection to its facilities and to take action, where required.
On a second front, in an odd dispute over naming rights, there is a company (Proview) in China that claims it has the rights to the “iPad” name in China, and is asking Apple to settle the matter. The company, which is technically bankrupt, is at least related to (and may be the same as) the company which previously sold Apple the rights to the iPad name in China, and does not, according to Apple, hold iPad naming rights in China (or anywhere else). Who has what rights will not be entirely clear until the Chinese courts rule, but the remedy being sought by Proview is to proceed city by city in China asking local courts to a) remove the iPad product from shelves, and b) prevent exports of iPad products to other companies. While the first element might upset some sales in some cities, the second action could potentially upset Apple’s whole global supply chain.
The common thread in these two elements, though quite diverse and with different mitigation approaches, is that risk profiles never stand still. Just when you thought you were ahead of the curve (as in CSR), you discover the bar being raised higher in a different way. On the second front, despite having done what they felt they needed to do on naming rights, sometimes the threats don’t fully disappear. Continuous monitoring and alertness is required on a number of fronts.