Reputational Risk Example: Foxconn Working Condition Controversy
Foxconn is an electronics manufacturing company based in Taiwan, producing products like Apple devices (iPhones, iPads, iPods), Amazon Kindles and PlayStations. Estimates are that Foxconn is responsible for manufacturing 40% of all consumer electronics worldwide.
In 2010, Foxconn was in the news because of a slew of worker suicides that were the result of bad working conditions. The stories were horrific, and their effect rippled down to the companies who used Foxconn as a supplier—most notably Apple.
The Foxconn controversy made headlines all over the world, and CEO Steve Jobs was forced to make a statement about Apple’s relationship with Foxconn. In the end, there were calls for Apple to address the problem, and, further, for consumers to boycott Apple products.