Electronics Industry
Supply Chain
Ruth Rosenbaum, TC PhD
CREA
Question: Who is Responsible?
In many countries, local and national
governments are responsible for the labor
laws and the environmental laws under
which factories operate and workers work.
BUT in many other countries, governments
do not govern to protect their people (the
workers and their communities) and the
environment.
Question of Responsibility


When governments do not govern to protect
workers and the environment, the question
arises: who has the power to create the
standards under which factories and businesses
operate?
The whole system of Codes of Conduct,
Compliance programs, audits, etc. is needed
BECAUSE governments do not govern to protect
their people, their communities and the
environment.
Power of the Corporations

We require corporations to be accountable
for this “governing” because:
1. They have the power to effect
change.
2. Shareholders and consumers hold
them accountable.
Why we are interested in supply
chains



Years ago, companies owned and operated
the factories and systems which produced
their products.
They could decide and enforce the labor
standards within those factories.
However even then, these companies did
not produce the materials from which their
products were made.
The Old Apparel Industry



Company X owned the factories and mills that
manufactured their products. Even then,
however, they bought the buttons, zippers,
thread, etc. from other companies.
These other companies were their suppliers
However because these suppliers were relatively
local, the apparel company know how these
other factories were being run.
Supply Chains in
the Global Economy



Materials can originate almost anywhere in
the world.
Assembly can take place almost any place
in the world.
In the apparel sector, a garment is
marked “made in country x”. It is simple.
There is nothing simple about the
Electronics Sector



Electronic instruments, e.g. computers, can only
be marked “assembled in country x”.
Essentially the inside of any computer is like the
United Nations.
To illustrate the complexity of the Electronics
Supply Chain, CREA staff disassembled an old
computer to see who made which components
where.
The Computer
CD drive
CD/DVD writer
Power
Supply
Floppy
Drive
Intel Chip
Ports
attached to
motherboard
Gateway
computer
Fan
Case
Once we go inside, we see…
Power
Supply
Motherboard
Wire harness
Power Supply
Major ComputerCD/DVD
Components
writer
CD drive
Hard drive
Floppy Drive
Mother Board
Complexities inside the Components
And then there is the monitor…
Gateway monitor
But again, when we opened it…
Going deeper, we found…
Major Components







Hard drives: Seagate, Western Digital
CD/DVD drives: Liteonit
Motherboards:
Batteries: Maxell (Hitachi)
Wire harnesses: Lucent
Processor Chips: AMD, Intel
Memory (RAM):
Major Manufacturers
Seagate
Western Digital
Lite-On-It
Hitachi
Lucent
AMD
Intel
and others…
Flextronics
Solectron
Jabil
Foxconn
Celestica
SCI Sanmina
Elta Electronics
Supply Chain Example
Computer
Assembly
DVD/CD
Hard disk
Motherboard
Wire Harness
Other
Components
Components
Capacitors
Chips
Circuits
Memory
With separate supply chains for the monitors, keyboards, mice, etc.
What has the Brand Name on it
is the result of the work
of many workers
in many countries.
The Underlying Problems


The labor issues found in any assembly
factory in any industry: wages, working
hours, etc.
Health issues related to:



Repetitive motion injuries
Exposure to solvents during assembly
Exposure to other chemicals, including heavy
metals, during assembly
Environmental Issues
during assembly


Exposure of workers to chemicals used in
assembly process
Disposal of chemicals used during assembly –
possible environmental and community
contamination
Toxic Chemical Exposure
during production
Many toxic substances are used during the
production of electronics components.
These include, but are not limited to:
Brominated flame, retardants, cadmium, mercury,
lead, tantalum, epoxy, copper, isopropyl alcohol,
hexavalent chromium.
Effects of exposure can include cancer, nervous
system problems, brain damage, blood diseases,
etc.
Environmental Issues
Disposal
Disposal of plastics (non-biodegradability)
Disposal of hazardous wastes
RECYCLING
realities and questions


Some computers are recycled to groups
and communities who are beginners on
computers.
Basic computers differ only in terms of
speed, storage space and RAM (think of it
as desk top space)
Software


Different programs require different
speeds, sizes of hard drives (storage) and
RAM (space for active working).
As programs become more complex, the
computers needed to run them must be
more complex.
Computer Operating Systems:
Windows, et al

In addition, each operating systems
version, whether for Windows for Apple,
places demands on the speed, storage
and RAM of the computers.
Effect on Recycling

While some components are recycle-able,
many are not, simply because computers
need the operating systems and software
to run them.
Types of Recycling



Components
Use of whole systems
by groups
Export of computers
to developing
countries
NOTE: This last requires
LOTS OF ATTENTION!
Recycled computers
in developing countries



Many computers and components are not
usable.
Unusable computers and components end
up in garbage dumps.
Heavy metals in computer components
contaminate the communities’ land and
water.
Our Work in the Electronics Sector





Labor rights issues
Environmental exposure issues during
production
Environmental issues related to waste disposal
during production
Environmental issues related to recycling
Examining the programs, policies and practices
of the companies from which we buy our
computers and other electronics equipment
These are not just contract
supplier issues but also issues
related to
- Human Rights
- Environmental Justice
- Sustainability
Core Questions



To whom does the EICC apply?
If the suppliers of components are
multinational corporations themselves,
how do we influence these corporations?
How far down an electronics supply chain
does a brand have influence? power?
control?
These are not just
questions of which
companies are in which
tiers but rather getting at
the locations in the
manufacture/assembly/
supply chain
where we can realistically
have influence.