Foxconn, the world’s largest electronics contract manufacturer, admitted yesterday that it had employed interns as young as 14 at one of its factories in China. The admission follows a series of criticisms of the labour rights record of the company. Foxconn, the main manufacturer of Apple’s iPhone devices, has been struggling to make its operations compliant with Chinese labour laws, a task made difficult by its huge scale and underdeveloped habits of compliance. The recent finding, made by Foxconn itself is “not only a violation of China’s labour law, it is also a violation of Foxconn policy”, said the company, pledging to conduct a full investigation in to the violation. (Financial Times*, Reuters)
Corporate Reputation
Starbucks accused of avoiding tax
Starbucks has paid £8.6m in taxes on a reported £3bn in UK sales since 1998, according to research by Reuters. Starbucks has paid no tax on its UK earnings since 2009 after recording annual losses to company accounts, differing from private reports by management of the UK operation’s profitability. The contradictions highlight legal tax-avoidance tactics used by multinational companies. The disclosure has led to calls by pressure groups and MPs for an inquiry into the company’s tax affairs. The Labour MP Margaret Hodge, Chair of the Public Accounts Committee said that Her Majesty’s Revenue and Customs (HMRC), the UK tax authority, should look into Starbucks’ affairs. (Guardian, Reuters, BBC)
Google told to alter privacy policy
EU regulators have demanded that Google substantially change its controversial privacy policies or risk fines. The move threatens to slow the US search giant’s introduction of new products and advertising schemes in Europe, and supports public criticism of the company’s privacy policy. European privacy watchdogs said a probe led by the French regulator CNIL showed that Google failed to provide users with adequate information about how their personal data were being used across the US group’s different platforms. (Financial Times*, New York Times)
Bribery claims raise stakes in battle for control of BP’s Russian venture
A former employee of BP’s troubled Russian joint venture claims to have evidence that senior figures were involved in bribing energy officials. Igor Lazurenko, who left TNK-BP in April, applied to lift a temporary order imposed by a judge in July, which restrained him from using company documents that he claims reveal “high-level [TNK-BP] personnel engaging in corrupt behaviour”. The news comes as BP continues to fight for control of the TNK-BP joint venture, and accuses senior management of collusion with Transneft, the state-owned company that controls Russia’s oil pipelines. (Times*)
Responsible Investment
Report shows boost in UK support for ethical investments
New figures from the UK Sustainable Investment and Finance Association (UKSIF) show a marked rise in consumer interest in ethical investments. According to the report, ethical investments in the UK are now worth more than £808bn. Penny Shepherd, UKSIF chief executive and co-ordinator of the National Ethical Investment Week (NEIW) puts the boost in demand for ethical investment down to “a summer of banking scandals”. New research from YouGov, released today to mark NEIW, has found that almost 60 percent of UK investors want charities to take a leadership role when it comes to investing assets in a responsible way. The research also found that 46 percent of UK investors want to allocate at least some of their investments to ‘impact investments’ such as social enterprises. (Huffington Post)
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