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Foxconn

----- current issue and future forecast

Table of Content
Executive summary 4

Introduction 5

Overview of the company 5

Economic 7

Current Issue 7

Responding the suicide case in China in economic aspect 7

Current economic issue in Foxconn 7

Future opportunities and risk in Asia region 8

Opportunities 8

Risk 9

Recommendation 10

Political 10

Current Issue 10

Suicide case on political aspect 11

The relationship with China and Taiwan 11

Future forecast 12

Opportunity 12

Risk 13

Recommendation 13

Social 14

Current Issue 14

Current social issues in Foxconn- Suicide Case 14

DISCUSSION ON LABOR, HUMAN RIGHTS AND OHS 15

Future Opportunity and Risk 18

Opportunity 18

Risk 18

Recommendation 18

Environment 19

Current issues 19

Future opportunities and Risks 19

Opportunity 19

Risks 23

Recommendations 24

Conclusion 25

Reference 26

Executive summary

This report provides the current economic, political, social and environmental issues, future opportunities and risks, and recommendations for Foxconn. There were a series of suicide incidents happened in Foxconn around 2010 which puts the company under the spotlight.

The huge net deficiency in 2010 is the biggest issue in economic part. The political issues involved the tense relationship between Taiwan and China which have impacts on trades. The social aspect of suicide incident is discussed from the perspective of labour, human rights and occupational health and safety. Additional, pollution is one of the biggest problems on the environmental aspect.

Some recommendations also are proposed in this report to response the current issues of Foxconn and solve the risks Foxconn would face in the future

There are some limitations for the report as some problems do not have a right or wrong answer, also since the main incident was happened in China, it is believed that some information was covered up beyond search.

Introduction

In recent years, turbulent business environment has brought companies with both opportunities and risks. Companies need to analyze quo status and forecast the future thoroughly if they intend to survive and make profits. In this report, it will analyze and discuss Foxconn from four aspects respectively, which are economic, political, social and environment. The suicide case will be discussed throughout the four areas and along with other issues that Foxconn had in recent years. Especially on the social side, the suicide incident will be explored and discussed in detail as it was one of the major issues that the company had to confront and other relating problems inside this giant factory have float to the surface.

Overview of the company

Foxconn International Holdings Ltd is a Taiwanese company that is one of the world's largest makers of electronic components. Some of the products are printed circuit board, cable and connector. Foxconn have been operating factories in China, Europe, India, Mexico and Brazil.

Directed by a belief that the electronic products would be a necessary part of daily life in each office and even in every home, Terry Gou founded Hon Hai Precision Industry Company Ltd with US$7,500 in 1974 in Taiwan (Hon Hai 2007), which is the initial company of Foxconn Technology Group. Foxconn was a trade name of the company at first, now it is called Hon Hai Technology Group. The first manufacturing place for Hon Hai was opened in Shenzhen, Mainland China in 1988. Now the company has 300,000 to 450,000 workers whom are employed in Shenzhen at the Longhua Science & Technology Park, which can be called as "Foxconn City" (Hon Hai 2007). The main stakeholders in Foxconn include shareholders, employees, directors and managers, customers, community and business partners.

Foxconn has hundreds of companies across Asia, Americas and Europe. The global strategy is “time to market, time to volume and time to money” (Hon Hai 2007). Time to market means focus mainly on China and America, and establishes research and development groups to develop new products in response to the need of customers and meet the vision of Foxconn. Time to volume describes focusing on central China, and develops at least two manufacturing places across Asia, Americas and Europe. In order to gain competitive advantages, Foxconn combines products, design, services and mass production with high efficiency and low costs to provide competitive technology products. Time to money means packaging and assembling at global phase. Make sure to achieve “right time, right quality, right quantity and right product” to the directed place.

Since 1974, Foxconn had always been directed by three visions and statements (Hon Hai 2007).

• Through the most efficient concept "Total Cost Advantages" to make electronic products to be attainable for all customers; • Through the proprietary one-stop shopping vertical integrated eCMMS (e-enabled Components, Modules, Moves and Services) model to transform the inefficient electronics outsourcing model; • Through the contribution to larger social harmony and higher ethical standards to achieve a win-win fashion for all stakeholders.
Foxconn is concentrating on fields of nanotechnology, wireless connectivity, heat transfer, material sciences, and green manufacturing process, and also, it has devotion in combining expertise for mechanical and electrical parts and an unordinary concept to give the lowest "total cost" to all people with the aim of raise the affordability of electronic products (Hon Hai 2007). Recently, apart from hardware related technology research and development investment, Foxconn also seeks to provide a more complete menu for customers to choose from.

Today, Foxconn Technology Group is the most dependable partner for manufacturing, joint-design, joint-development, assembly and after-sales services to global “3C” (Computer, Communication and Consumer-electronics) leaders.

Economic

Current Issue

Responding the suicide case in China in economic aspect

In the economic aspect, as the purpose of making a good response to the suicide case happened in Foxconn in China 2010. Through serious discussion and thinking by the executives of the company, it is reported by Ye H (2010) that from the 1st June 2010, Foxconn has already adjusted the salary level of all employees in the south China city Shenzhen, which increased by 30% or more than before. For instance, the operators’ salary rose from original 900 RMB per month to 1200 RMB per month. In the 6thOctober 2010, Foxconn declared that the company would increase the salary of all employees in Shenzhen again, continue use the operators’ salary as an example, which means the salary of the operators would increase from 1200 RMB per month to 2000 RMB per month now. The rate of increasing salary of all employees reached at 66% in total. Foxconn said, the decision of this increasing salary’s activity to all employees in Shenzhen is based on the principle of rising commodity price and cost of living in the whole society, which also combine the overall operating conditions of Foxconn in recent years.

Current economic issue in Foxconn

According to Foxconn annual report released that the net deficiency of Foxconn in 2010 reached at $218.3 million dollar, and the stock fell 5.5% to HK$4.62. The head of Foxconn together with other executives summarized the main reason of this loss that can be divided into three parts. First of all, it is calculated by Foxconn that there are nearly 450 thousand employees in Shenzhen, with the decision of increasing salary of all employees, then it will spend more about 5 billion RMB than before which only in the salary aspect. Thus, the increasing costs in the company’s operation such as the substantial growth of employees’ salary are one of the biggest reasons influence the company’s benefits that led to the financial loss in the company. Additionally, after suicide case happened in Shenzhen, then Foxconn further increasing the intensity of movement, and trying to find cheaper labor regions in China, Chongqing, Chengdu, Zhengzhou are three representative cities that Foxconn want to invest. Thus, the extra cost of movement in the company is another aspect that results to the company had a loss in 2010. Lastly, it is indisputable that the financial crisis brought a disaster to the global economy, Foxconn also suffer a negative impact. Foxconn’s customers such as Nokia, Sony and other electronics giants are all reduced by the numbers of order form to Foxconn (Fellman, 2011). Therefore, the increasing costs add to decreasing order form in the company that lead to Foxconn had a significant financial loss in 2010.

In 2011, due to the financial loss in 2010, Foxconn is still at a loss until now. However, Reuters (2011) reported that the bad situation of company is under control. In the first half year in 2011, the net loss of Foxconn narrows to $17.65 million.

Future opportunities and risk in Asia region

Opportunities

In order to reduce the pressure of high labor costs in Foxconn, the company said it would import 1 million robots within three years in China to instead of the employees, who work in the production line. The robots are used to perform the simple and repetitive tasks, so as to improve the overall productivity and reduce the labor cost. (Branigan 2011) To Foxconn said, this is a good opportunities for the future developing.

In addition, it is reported by the International Monetary Fund that although the global economy is reviving by a slowly speed, the organization predicted that the overall trend of the global economy will keep increasing in the following years. Then, the order form from the customers will increase as well. In 2010, Foxconn also used joint venture method to cooperate with the Metro Group to continue broadening the China market. The aim of retail store Media Market is to expand its nationwide network of at least 100 stores within next 10 years (China Market Intelligence Center 2010).

Furthermore, in the next ten years, following the Chinese Eleventh Five Year Plan, it will pay more attention on the urban construction, economic development and rational allocate resources both in the Midwest region’s second tier and third tier cities and the eastern region’s third tier and fourth tier cities. Also, the company has already moved manufacture to Zhengzhou with combining the Foxconn’s strategy. Thus, the Chinese Eleventh Five Year Plan will provide a good opportunity to Foxconn, because there is a close relationship between the business’ development and the city’s development. A city with perfect functions, stable and harmonious economic environment, and advanced technology and education will stimulate the vitality of business development, creativity and core competitiveness.

Risk

On one aspect, it is known that Foxconn is a company that mainly producing electronic components for customers. So, the profits of Foxconn are majority depend on the numbers of the customers’ order form. Recently, the rapid development of BYD, which is a company’s mainly producing rechargeable batteries, has brought a seriously threaten to Foxconn. As the reason of these two companies are both manufacturing the similar products for the customers, adding the suicide case happened in Foxconn in China that lead to the company undertook a lot of negative impacts in the society, so the company has to spent a lot of time, energy and money in solving the big issue. In this situation, Foxconn’s problems provide a good opportunity to BYD. In 2010, BYD successfully took the order form for Motorola, Samsung and other companies (BYD 2011). Threaten from the other companies that produce the similar products in Asia market can bring a big risk to Foxconn in the following years.

On another aspect, the currencies among countries are changeable. Under the global macroeconomic, with the RMB appreciation and price of raw material increasing, then the cost of products will more expensive than before. The successive problem is it maybe will influence the Foxconn’s quantity of exporting. It is reported that the net profit of manufacturing electronic components is very small. For instance, when Foxconn took the order for Apple to process the iPhone 4, the net profit that Foxconn can earn is just nearly 40 RMB for one product (Barboza 2010). To Foxconn said, in the next ten years, the changeable currency combine with more and more expensive raw material are another aspect of risks that has to face.

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Recommendation

One recommendation to Foxconn is the company maybe can think about the business transformation in the following years and establish the own brand for company. Business transformation means changing the long term business direction, organization model and the way of resource allocation in the company, which can enhance the competitive advantage in the company, also can improve its social values (Cornwell 2007). Because Foxconn has its own manufacture and has preferential policies of local government in different areas. Foxconn maybe can establish its own R&D department to develop its own products with its own brand. That should be a good opportunity to continue broadens its business and increasing its profits.

Political

Current Issue

Suicide case on political aspect

In political aspect, the first issue is that the suicide resulted from violating labour law and labour rights. Foxconn employees work overtime seriously and their payment is below the standard of labour law. According to Agence France-Presse (AFP) (2001), many Foxconn employees worked 80 to 100 hours of overtime a month on top of their regular 174 hours, which was more than three times China's legal limit. Additional, many employees agreed to overtime working because the payment they can get is not sufficient for them to survive. However, Foxconn did not offer the payment of overtime work according the labour law that is the overtime payment of one hour cannot below the 150% of the regular salary of one hour. Foxconn regulated that Foxconn pay the overtime work at most 80 hours, if more than 80 hours, it will be accumulated as 80 hours only. This regulation violated the labour rights seriously. The employees of Foxconn cannot be promised the basic benefits.

Moreover, Foxconn also employed underage workers which are illegal. Apple has admitted that child labour was used at the factories that build its computers, iPods and mobile phones, including Foxconn (Moore M, 2010). According to Apple, 91 children under the age of 16 were discovered to be working last year in ten Chinese factories owned by its suppliers, while there are 42 children working on the production line in one of the factories (Chang C, 2011). The existing illegal issues demonstrated that Foxconn did not treat the employees well and protect their benefits.

The relationship with China and Taiwan

Foxconn is a Taiwanese company. Therefore, in political aspect, there is a concern with the relationship between China and Taiwan. After losing the civil war between Kuomintang and Communist Party after World War II, the nationalist Kuomintang (KMT) leaders fled to Taiwan and defensed the Chinese Communist Party that was regarded as illegitimate since 1949. Kuomintang thought that they have their own sovereignty and departed from mainland of China. The Chinese government always adheres to the “One China Principle” that means Taiwan belongs to a part of mainland of China which cannot be departed. Since then, the issue of the relationship between China and Taiwan raised. (Lee Y, 2009)

Because of the worsen relationship between China and Taiwan, the Chinese government interfered the trade of Taiwan. Taiwan was not allowed to make trading relationship with its other major trading partners because the Chinese government opposites Taiwan to sign any trade agreements as independent position (BBC News, 2010). For example, in the past, Taiwan intended to make agreement with Singapore. However, Singapore rejected because the diplomatic pressure from China. The tense relationship between China and Taiwan is a significant risk that Foxconn is facing, which could bring some limit policies and interventions to the trades and business.

In 29 June, 2010, Taiwan and China signed an outline free-trade deal that is Economic Cooperation Framework (ECFA), which means to decrease 539 categories of Taiwanese exports to China over the next two years and 267 Chinese products entering Taiwan that shows the friendly from President Ma Ying-jeou to China. This is a big progress of changing cross-strait relationship between China and Taiwan since the civil war in 1949 (BBC News, 2010).

Future forecast

Opportunity

With the Economic Cooperation Framework (EDFA) signed, the relationship between China and Taiwan will have some relief that is an opportunity for Foxconn. The Chinese Government always implements the largesse political that is Taiwan could conduct free and peaceful negotiation as long as admitting the “One China Principle” (the economist, 2010). Mainland of China will cut off the tariffs or provide some preferential policies to encourage the trading relationship with Taiwan, which could benefit to the trade and business of Foxconn with mainland of China.

In addition, signing up the Economic Cooperation Framework (EDFA) is a concession of both Chinese Government and Taiwan in order to mutual benefits through harmony and peaceful relationship. Under such a friendly environment, it is an opportunity for Foxconn to facilitate the development within the mainland of China, even the whole Asia. In 2010, Mainland of China has become the biggest exporter in the world (Inman P, 2010). China has the advantage of abundant resource, not only raw material but also the low cost labour. The improving the relationship between China and Taiwan is a beneficial opportunity that could help Foxconn to control the cost of manufacturing.

Risk

Owing to the low cost, increasing electronic company choose outsourcing to keep the low cost. While Foxconn is attaining the opportunity, it also is facing a big risk. The key manufacturing base of Foxconn is in mainland of China. Recently, Chinese government has realized the sustainable development because of the increasing outsourcing from foreign company. They are establishing some law or regulations to control and improve the issues, such as the pollution resulting from the manufacture, the non-renewable resource, the broken balance within economic, environment and ecology because of arbitrary exploit, etc. These law and regulations will limit the development and producing of Foxconn and increase the cost has to implement them.

Moreover, because of the issue of suicide in China, the public in whole world pays more attention on the labour rights, but not only Chinese Government. Governments would enhance the power of monitoring and oversight the management and operation of Foxconn, which would make Foxconn have to cope with such a strict situation.

Recommendation

From the issue of suicide, Chinese government should enhance the power of supervise and regulatory, and find out the problems and work out the solution to do relevant response such as reforming the law or regulation, offering training to managers and security, providing physiological counseling to staff, which could decrease or eliminate the likelihood of this kind of incident happening,

In addition, the relationship between China and Taiwan should be ongoing peaceful and friendly. Under the circumstance of mutual benefit, improve the relationship and facilitate a greater degree of free trade in order to realize the goal of maximum of both economic profits and political benefits.

Social

Current Issue

Current social issues in Foxconn- Suicide Case

Between January and August 2010, a string of sixteen suicide incidents occurred at Foxconn factory in Shenzhen province, China. Foxconn workers died after jumping off company buildings. It has resulted thirteen deaths and three who survived with serious injuries. According to various media reports and academics, the reasons behind the suicides are related to poor working conditions and long working hours (Business & Human rights resource center, 2010). The following graph has shown a timeline for these suicide attempts by workers.

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From the above graph, it is clear to see that workers who committed suicide are between ages of 17-28 years old which represents the younger generation. In other words, this generation normally has a higher education level and grown up in a better environment than their parents, which also meant that they have a higher work expectation and ambition. Most of the workers are from rural areas that are isolated with family and forced to sign exploitative labor contracts (Barnhart, 2010).

From the social perspective, such incident is related with labor, human rights, and occupational health and safety (OHS) issues.

DISCUSSION ON LABOR, HUMAN RIGHTS AND OHS

LABOR

On the labor side, workers at Foxconn are always overworked, underpaid and have no personal life or entertainment. The legal overtime work in china is 36 hours a month, but workers at Foxconn usually work between 80 ~ 100 hours overtime in a continuous motion. Technically, overtime working is voluntary, however, without working overtime workers could barely live on the basic wage of 900 RMB due to the high living costs in China. Excessive overtime working is a routine and workers think factories that offer overtime are good factories, so they could make a living (Yam,2010). In addition, only those workers who have good connection and serious ‘trust’ or whom in key position could get to work overtime and a “voluntary overtime affidavit” is required to sign by each employee in order to waive the legal overtime limit.

Nevertheless, workers are often underpaid by miscalculation or missing pay slip and not paid for all the hours they worked. As workers could get fines or punishment if being caught talking on the production line, having cellphones, sitting down or taking breaks without permission.

Although there are good facilities inside the factory such as swimming pools, calligraphy room, workers barely have time to really use those facilities provided by Foxconn. According to news, a good night sleep is what most of the workers want. During the day, normally there is a 10 minutes break every two hours, however, when it gets busy, there will be no breaks until lunch time and followed by another 5 hours’ work with no break and even required to skip dinner in a continuous shifts (Huffington post, 2011).

HUMAN RIGHTS & OHS

In regards with human rights, workers who performing badly would be asked to write a confession letter and sometimes required to read out in front of other colleagues, such public humiliation is another factor that contribute to work pressure and unhappy workers. On the production line, workers are prohibited to talk with colleagues, otherwise punishment will be applied. Thus, friendship between colleagues are difficult to develop, according to reports, even workers who share the same dormitory room barely know each other’s name (Chamberiain, 2011).

In addition, it is not allowed to use electronic kettles or hairdryer inside the room, otherwise penalty will apply. From the perspective of human rights, workers in Foxconn are mistreated by disrespect as well as low labor rate and long working hours. Adaptation of company policy is needed in order to prevent future suicide and dissatisfied workers. Worker’s emotional, physical and spiritual reactions are important for the senior management as it indicates levels of work efficiency and psychological health of the workers. At the moment, both working hours and wages do not allow for any social life (Barnhart, 2010). Humans need community, freedom and relaxation, they are not robots.

In addition, the military-style management in Foxconn is another factor that contributes to humiliation of workers. Supervisors would yell at workers with negative language and warned workers that they may replace by robots if they do not work efficiently (Moore, 2010).

Furthermore, occupational health and safety is another concern that employees have when they perform toxin related task. Workers are normally not told about the possible danger of chemical used in assembly process. There is an incident that a woman whose task is to remove excess glue from iPad cases developed a red rash on her legs and faces by using industrial alcohol to finish her task. Also, another department at the factory is filled with aluminum dust in the air. The dust would cover worker’s hands, clothes and faces. The employee said that her nostrils are completely black every day. These are all the potential harm from occupational diseases (SACOM, 2011).

Overall, the suicide case was a big issue that puts the company in the spotlight during 2010. It can be a positive thing, if we consider the deep-rooted corporate culture inside the Foxconn, it was problematic in the first place and suicide cases might just be the result of harsh management. Until today, the truth remains unclear to the general public. However, there are signs and incidents that continually signaling Foxconn to do the right thing, otherwise the problem will continual to exist.

Future Opportunity and Risk

Opportunity

Foxconn operates most of its factories in China due to cheap labor and high quality outcome. But they are looking to expand its operations beyond China as the Chinese labor costs are raising slowly. Brazil is the targeted country, since it is the fastest growing economies in the world and becoming an attractive market for organizations (BBC NEWs, 2011).

“If you’re trying to serve Latin America, Brazil is certainly the biggest country you have to hit” (Misek, 2011)

If negotiations and discussion in Brazil government went smoothly for the entry of Foxconn, they will begin assembling iPads in Brazil as soon as possible. However, whether the military-style management should be used in Brazil become a question.

Risk

Social risks involved terrorism, unemployment, crimes and war. In the case of Foxconn, there is a potential danger of job loss. As the chief executive Terry Gou unveiled a plan to hire 1m robots by 2013. This plan is to increase the value chain, also robots are easier to manage since they do not complain (The economist, 2011). With human labor, they will demand for higher wages or otherwise kill themselves as what happened in 2010. However, such move will cause a huge loss of jobs for many workers. It became a dilemma in such situation, as it is fair that companies seek for its profits and minimize the costs, however, who will be responsible for the jobless workers? Since Foxconn is employing more than 400,000 people, the replacement of robots will definitely lead to social turmoil of unemployment. There is no right or wrong answer in the field of business ethics on this issue. This is a plan that Terry Gou need to re-consider for ethical and corporate social responsibility.

Recommendation

From the social perspective, suicide is too complex to reach a conclusion. From personal view, there are mainly two issues needs to be solved that are workers’ welfare and recovery of Foxconn’s reputation. First, Foxconn still need to raise the wages to a decent level. Secondly, provide workers with counselors, psychiatrists that offer psychological and spiritual help. Thirdly, adapt the current military-style management and corporate culture to a more flexible and friendly work environment, it will not only improve the performance of the organization, but also recover the reputation of the company.

Environment

Current issues

The survey of environmental pollution indicates that Apple’s PCB (printed circuit board) is a typical environmental pollution case. There is a 150 meters canal which through South Lake in Wuhan and the whole canal is flowing milky white liquid. The test results show that the water contains heavy metals copper and nickel which is substantially exceeded the standard. Foxconn Taiyuan’s factory mainly manufactures mobile phones and notebook shells for Apple and which produce large amounts of air pollution at production process.

The survey pointed out that a large number of Apple’s suppliers were found to have significant environmental violations. There are 80 out of 129 factories did not properly stored or handled hazardous chemicals last year, 41 factories did not recycled or disposal of hazardous wastage, 37 factories failed to monitor and control plant emissions and there are more than 10 factories have the problem of wastewater. Lastly, 63 factories running business without government authorizes of license.

Future opportunities and Risks

Opportunity

Sewage treatment

Foxconn Technology Group vigorously promoted pollution prevention program and set up recycling projects in 2009. This project used on Long hua Park wastewater reuse which saved 6.17 million RMB annually. Foxconn totaled 6, 427, 32 tons of water and the total efficiency saving reach 31,969,723 RMB.

Now Foxconn owns 10,000 robots which are learning plating. Next year the robots will reach 30 million units and also they have decided to increase by 100 million units of industrial robots in the next three years for sewage treatment on organic precipitation. (Pablos&Lytras 2008, pp. 215)

Membrane BioReactor (MBR) features:

• Good water quality conducive to recovery

• Simplify the process, improve efficiency

• Reduce chemical use

• Reduce the amount of waste sludge

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Water recycling:

• Water supply system built recycling in Long hua plant to cooling towers

• Water supply for more than 3600 tons per day (total recovery cycle 10%)

• Remote wireless monitoring

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Energy saving information

Foxconn invested 67,243,547 Yuan special funds for energy conservation which capacity of 13,912 tons of standard coal in 2009. Foxconn Czech plant used highly efficient production processes to eliminate backward and inefficient production technology because of the reduced number of employees as well dramatically reducing the amount of heat and energy plant (Zhang &Alon 2011, pp. 144).

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ENGERY SAVING MANAGEMENT

Foxconn established Technical Committee in order to strengthen the effective management of energy saving environment protection with using advanced management ideas and methods. Meanwhile, the establishment of energy management system and monitoring system will strengthen the management process.

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R & D andA PPLICATION OF ENERGY-SAVING TECHNOLOGIES

Self-developed energy-saving LED lights, energy-saving aluminum, all heat exchangers and other intellectual green products to promote the production conditions and living environment.

Green products

In 2008, the total carbon emissions are 1,601,784 tons of CO2 per year at the world’s largest production base in Long hua plant area. After implementing a series of emission reduction measures, the total emission has decreased to 1,392,746 tons of CO2 per year in 2009 which has a decreasing of 13%. For 2011, Foxconn is aiming to reduce carbon emissions by 6% and 10% more for 2012. (Foxconn Electronics Inc 2007, p. 45)

Risks

Raw Materials Shortage

At present, there have several reasons raw materials cannot satisfy demands of production. First, world production of raw materials is increasing all the time, however, the raw materials availability is decreasing because of excessive using.

Second, natural disaster has an indirect influence on raw materials shortage. Tyrsina (2011) said that Foxconn faces the threat of the shortage of raw materials in China. For instance, Foxconn was struggling to cope with shortage of product component because of Japan’s earthquake in May 2011. Last, raw material price is increasing.

Pollution risk

Foxconn Company belongs to electronics manufacturing industry that leads to heavy-metal pollution. The Greenpeace International (2007) provides information which many electronics industries’ famous high-tech brand and their suppliers, are polluting underground and rivers with large scale of deleterious chemical. Take an example, specific to Apple and Foxconn, Apple’s supply chain is Foxconn in China, they have a duty to environmental pollution. In the meanwhile, China pays attention to environmental protection issues. The companies that are labour intensive and extensive production get punishment and restraint. Therefore, Foxconn is facing the risk of environmental pollution.

Workplace security risk

Foxconn’s workplace has lots of hidden troubles about safety. For example, according to Gizmodo (2011), two people have been killed at a big explosion at Foxconn’s Chengdu factory on May 20 because of combustible dust accidental explosion. Then, Humphries (2011) reported that an explosion and fire broke out at a Foxconn Shandong factory on September 27.

Recommendations

Creating a Green Industry Chain for E-waste Disposal and Recycling
Present situation of E-waste treatment and integrated utilization industry is “significant number of resources, high using value, treatment technology low, sever environmental contamination”. Vay Tech (2009) said that every year produce around 20million ton electronic wastes in China. But, E-waste contains a large number of nonferrous metals as recyclable. And, surprisingly, reclamation value of E-waste in China is above 100 billion. Therefore, E-waste should be noted under raw material shortage condition.

Improving CSR (Corporation Social Responsibility) on environmental protection aspect
When it comes to CSR, Foxconn management appears as: • Increase efficiency, for example, improving using rate of energy and raw material, sell recycle items. • Decrease cost, for example, reducing waste product, preventing pollution emissions
Foxconn is supposed to voluntary protect environment in the process of production abide by China Environmental Protection Law, pollution reduction, installation of automatically sewage treatment plants, thereby final can sustainable development.

Improving CSR (Corporation Social Responsibility) on humanistic concern)
Foxconn should implement equipment modification to provide safer working environment, at the same time, make sure all employee understand how to deal with accident through effective and efficient training.

Conclusion

Foxconn is undertaking the pursuit of robust process and also actively in export earnings as well promote investment in the development of the industrial chain. The goal of Foxconn is nurture talent pool for company better performance, increase cooperate social responsibility and create harmony.

In conclusion, this report mainly focus on the suicide issue happened in China, Shenzhen, and then illustrates the current issues around four parts that includes economic, political, social, and environment. After that, it forecasts the opportunities and risks in the next ten years in Foxconn. At the end, some recommendations proposed to response the risks that Foxconn would face.

Reference

Inman p, 10 January, 2010, Guardian.co.uk, China becomes world’s biggest exporter, viewed on 18 October, 2011 http://www.guardian.co.uk/business/2010/jan/10/china-tops-germany-exports BBC News, 12 September, 2010, Historic Taiwan-China trade deal takes effect, viewed on 17 October, 2011 http://www.bbc.co.uk/news/world-asia-pacific-10876580 BBC News, 5 August, 2010, Taiwan and Singapore to hold trade deal talks, viewed on 17 October, 2 Chang C, Feb 15, 2011, M.I.C. gadget, Underage worker assemble Apple products in Foxconn
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http://www.bbc.co.uk/news/world-asia-pacific-10876580

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