We believe that a key component of managing foreign business partners, including vendors in the Supply Chain under the Foreign Corrupt Practices Act (FCPA), is the right to audit. While others have indicated that they feel such a right is not a key component, one thing we all agree on is that if you have that right, you must exercise it. We were therefore interested this week when Apple released its 2011 Supplier Responsibility Report. Apple looked at a variety of issues that affect its business relationships with its suppliers, these areas included training, protecting of workers, use of underage labor and social responsibility. The area which Apple audited that caught its attention was compliance.

In this Supplier Responsibility Report Apple set forth its audit protocols. We felt the Report provided a good outline of such an audit program and is useful for the compliance practitioner; whether following the FCPA, Bribery Act or some other similar legislation. Initially, Apple stated that it has a rigorous monitoring program to ensure its products meet the appropriate compliance conditions. Of the suppliers Apple audited in 2010, more than 40 percent stated that Apple was the first company ever to have audited their facility for compliance.