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Assessment Title Leadership and risk management of APPLE Inc.

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Table of Contents
“Organisational culture and role of the board”...................................................................................3
Apple’s culture and leadership style.....................................................................................................3
Duties of the board................................................................................................................................4
“Corporate Governance”.............................................................................................................................5
Corporate governance framework for Apple......................................................................................5
Remuneration Committee at Apple......................................................................................................6
“Regulatory Landscape and Management Risk”..........................................................................................6
Risk management..................................................................................................................................6
The regulatory landscape for Apple.....................................................................................................7
The risk faced by Apple and recommendations to address them.......................................................7
Part B Leadership Report.............................................................................................................................9
Task 1: Leadership and Management..........................................................................................................9
Apple VS Samsung Leadership Style...................................................................................................9
Table 1. Apple VS Samsung Comparison.............................................................................................10
Future Development Issues.................................................................................................................11
Handling Business Challenges........................................................................................................11
Task 2 Leadership for Performance............................................................................................................12
Balance Score Card.............................................................................................................................12
Leadership for Performance...............................................................................................................14
Financial Statements...........................................................................................................................16
Task 3 Ethical Leadership...........................................................................................................................20
Ethical Issue of Apple..........................................................................................................................20
References.................................................................................................................................................22
Executive Leadership and Governance
Part A
“Organisational culture and role of the board”
Apple’s culture and leadership style
Apple Inc. is amongst the leading technology company delivering excellent services to
customers and providing top-notch innovative smart devices to them for meeting the tech-driven
changing demands of its users (Tilak Naik and Vaikunth Pai, 2018). The company has been
successfully operating in the global market. The corporate culture and leadership style of Apple
are the significant contributors to the success of the company in the international market. The
leaderships style fostered by the company values its creative and innovative culture. The
corporate culture of the company and the leadership style supporting that cultural values are
presented as under:
Creativity and innovation
Apple fosters an organisational culture of creativity and innovation (Meyer, 2022). The
cultural features of the company are focused on upholding high standards of innovation and
creativity that challenge the pre-set standards in consumer electronics designs. According to
Meyer (2023), the integration of innovation, creativity, and excellence evident in the culture of
Apple Inc. facilitates the company in positioning itself as the industry leader.
Despite the focus on innovation, the culture of Apple is inclined towards a hierarchical
structure. Schermerhorn et al. (2019) pointed out that Apple has a solid organisational culture
with the traits of a rigid hierarchical structure. However, the company has undergone significant
change in recent years by transforming to a democratic leadership style. In contrast to Steve
Jobs, the present CEO of Apple, Tim Cook, promotes democratic leadership, which is one of the
prominent leadership styles proposed by Goleman (Dudovskiy (2023). The democratic
leadership of Cook enables the talent to contribute to the success of the company by considering
their consensus in strategic decision-making. The leadership style of Cook's depicted the
combination of transformational and transactional leadership whereby he focuses on a
democratic style along with placing high value on performance. According to Antonakis (2017),
this leadership style is valuable in fostering employees' input and commitment and ensuring a
high degree of motivation.
Combative or sociable culture:
 The culture of Apple Inc. is characterised by moderate combativeness. The
combativeness of Apple's culture is related to the leadership style of Steve Jobs, which inclines
more towards a combative leadership approach. The combative approach of Steve Jobs was
evident from his practice of challenging the employees randomly to assess their aptitude.
However, under the leadership of Tim Cook, the culture of Apple Inc. slightly moved from a
combative to a sociable approach. Although combativeness is a major influencer in the
technology business, Apple demonstrates a moderate level of combativeness that enhances the
employee's output (Meyer, 2023).
Duties of the board
The board reflects the group of people that are elected as shareholder representatives for
establishing the policies and making decisions in the best interest of the company. The board of
Apple is segregated into three roles that are executive, non-executive, and compliance roles.
Executive role reflects the executive directors and senior management with managerial
responsibilities. Executive directors are primarily responsible for the internal affairs of the
company and are responsible to shareholders for managing their interests. The executive roles of
Apple encompass the CEO and senior management, who ensure the competent and ethical
functioning of the company on a regular basis, along with safeguarding the long-term interest of
the shareholders (Apple. 2023). The responsibility of the executive roles encompasses effective
decision-making for the company’s operations and its future direction. In connection to this, the
role of executive directors involves assuring the long-term success and sustainability of the
company. Executive directors are accountable to shareholders for protecting and enhancing the
value of their investments by making strategic choices and developing plans that support the
economic interests of the shareholders.
Non-executive directors of the company are responsible for assisting in the monitoring of
business by providing strategic guidance and evaluating the management team in terms of their
performance in meeting goals. The role of non-executive directors underlies advise about the pay
policy for executive directors, supervision of internal audits, appointment of new directors, risk
management etc. The third role that is evident in the board of Apple is compliance role. A
compliance officer is responsible for ensuring the organisation’s compliance with legal
requirements, regulations, and internal policies. The global compliance team of Apple is
dedicated to ensuring the company’s compliance with regulations relating to exports and
sanctions, business conduct, anti-trust, and anti-corruption (‌Apple Compliance. 2023). The chief
compliance officer is responsible to deliver continuous updates to the finance committee and
audit committee of the board of directors of Apple. The Chief Compliance Officer (CCO) is
accountable for developing standards and employing the practices that assure the efficacy of the
compliance programs in terms of identifying, detecting, and preventing non-compliance with the
laws and regulations applicable to the company (Chief-compliance-officer. 2019).
“Corporate Governance”
Corporate governance framework for Apple
Effective governance is critical to create long-term value and to build stakeholders’ trust. The
corporate governance framework reflects the compliance of Apple Inc. to multiple regulations
and ideologies guiding shareholder management, business operations, and ethical conduct.
Domestic corporate governance framework:
The domestic corporate governance framework reflects the adherence of the company to
regulations and its operations in the domestic market. The domestic corporate governance
framework for Apple encompasses the board of directors (BOD) and different committees like
the compensation committee and audit committee which prioritise the stakeholder’s trust and
promote ethical business practices, transparency, and commitment to the interest of stakeholders.
The domestic corporate governance framework guides the business practices in terms of
executive compensation, financial reporting, and election of the BODs. It also encompasses
shareholder management by prioritising the rights of shareholders and practising transparency
and open communication with them. The governance framework of the company also involves
initiatives to improve sustainability, and promote ethical conduct in terms of data privacy,
cybersecurity, and board diversity (Mahmood, 2023).
International corporate governance framework
The international corporate governance framework takes precedence in the international market
and guides the business in terms of its practices while operating in other countries. The
international corporate governance framework of Apple embraces compliance officers that
ensure the adherence of the company to the regulations and international laws. Apple being a
multinational company operates in a number of nations; the company has to comply with the
corporate governance laws relevant to each country. Compliance with the relevant international
laws is imperative for Apple’s global operations. In accordance to international corporate
governance, Apple Inc. also needs to adhere to the reporting standards of the host country to
maintain transparency and consistency in financial disclosure across multiple markets.
The international corporate governance framework also encompasses risk management on an
international scale, monitoring the risks associated with different countries in terms of political
regulations and cultural sensitivity. Apple operates in a culturally diverse market; therefore, it
should recognise the eminence of cultural differences in terms of governance.
Remuneration Committee at Apple
The remuneration committee is the board’s committee that is accountable for setting the
compensation and salaries for the executives of the company, including its CEO and other senior
leadership team. The role of the remuneration committee at Apple encompasses setting and
modifying the salaries, compensations, and incentive programs for the executives of the
company (Apple. 2023). It undertakes to review and approve the compensation and awards for
the executives that are appointed by the company. The roles of the remuneration committee of
Apple include the following:
 Review and approve the compensation and the incentive programs and align the
compensation with the performance of the company.
 Reviewing and directing the annual evaluation of all executives of the company in terms
of their performance.
 The committee fixes the salaries, privileges, and bonuses of the officers of the company
in relation to their performance (Apple. 2023).
 Administrating the plans for stock options and equity arrangements adopted by the
company.
“Regulatory Landscape and Management Risk”
Risk management
Risk management is a dynamic process, and the board is responsible for identifying and
responding to the changing business environment. The board of directors of Apple is accountable
for overseeing and responding to both the strategic and operational risks impacting the company
by identifying, assessing, and prioritising the risk through regular risk assessment and
appropriate scenario analysis. In order to be effective in responding to the risk, the board needs
to integrate risk management with the company’s strategic management process in order to
support the achievement of strategic objectives alongside mitigating the risk.
The regulatory landscape for Apple
The regulatory landscape reflects the laws, policies, and regulations that the company is obliged
to follow (Jose et al., 2020). There are a number of regulatory policies that Apple has to comply
with, such as privacy regulations and environmental regulations. Privacy regulations relevant to
the protection of user data are a significant matter of concern for companies like Apple (Apple.
2022). Privacy regulations like the General Data Protection Regulation influence the operations
of Apple relevant to the creation and marketing of the products that are related to handling user
data. The company also needs to abide by the environmental regulations in terms of recycling,
supply chain sustainability, and energy efficiency.
These regulators are significantly important for the success of the company as compliance with
them is integral for Apple while expanding globally and entering novel markets. Moreover, it
also has financial implications as non-compliance to regulations would result in high legal costs
to the company along with solid damage to the company’s brand reputation.
The risk faced by Apple and recommendations to address them
Apple confronts multiple risks related to (1) creative innovation, (2) supply chain disruption that
may impact the availability of Apple products, and (3) competition (Wallace, 2016; Pandey et al.,
2020). However, the most critical challenges facing Apple are creative innovation and losing
ground for Silicon Valley. Apple Inc. has already established high standards for creativity and
innovation by continuously launching ground breaking products and surpassing the expectations
of its customers. Being consistent in not only meeting but exceeding the expectations of the
consumers is challenging for Apple. Grounded on the 4 T’s model, apple is recommended to
“treat” the challenge by strengthening its creative teams. It is recommended that Apple should be
proactive in addressing these risks by engaging in continuous innovation, and proactively
engaging with the creative teams to address the concerns for ensuring continuity in bringing
creative innovations.
Losing the ground in Silicon Valley is another significant challenge facing Apple. Silicon Valley
is getting saturated with emerging tech hubs which created challenges for Apple’s survival.
Gurman (2021) confirms it as a challenge to Apple by mentioning Apple’s decentralisation from
Silicon Valley and highlighting the issue of losing talent in spite of being one of the dominant
technology companies. These anticipated risks are likely to create a threat for the company and,
therefore, need to be addressed proactively to mitigate their impact. Companies should consider
“treating” this risk by considering investing in supply chain resilience to stay ahead of the
evolving threats. Apple could also consider the “terminate” strategy following the 4 T’s model by
exiting from Silicon Valley and expanding its talent recruitment to other tech hubs throughout the
world.
Rising competition has also emerged as a critical risk for Apple. Amidst the high competition, it
becomes challenging for Apple to stay ahead in the competition by continually surpassing
customer’s needs as a lot of other players are striving for the same differentiator. The company
should “treat” the risk, and strive to maintain its competitive edge by leveraging technological
advancement and continuing to deliver cutting-edge innovative products that could provide a
whole new experience to customers to retain their loyalty.
The role of the board in managing these risks is critical for the company’s success, as it is
responsible for strategic decision-making and risk management which guides the company to
move through the challenges. The strategic guide of the board would facilitate in managing these
risks effectively. The board’s engagement in regulatory advocacy and proactive strategic moves
would be influential in managing the risks efficiently. The dedicated engagement of the board
would allow the company to successfully respond to the challenges while maintaining
competitive advantage.
Part B Leadership Report
Task 1: Leadership and Management
Peng, Liu and Lu (2021) stated that Apple is a company that uses the democratic leadership
style. In addition, Syamsidar et al., (2021), considered Apple’s democratic leadership and
management style as visionary direction combined with inclusive decision-making
processes. First of all, the apple values and promotes a culture where people are contributing
ideas which in Geert’s sense means they feel ownership this is deducting from worker
engagement (Lasrado et al., 2019; Viterouli et al., 2023). In addition, Bwalya (2023) also found
that one of the strengths in Apple democratic leadership style is creativity and vision being
shared by many. Leaders such as Steve Jobs and Tim Cook have steered Apple to be employee-
centric, fostering critical thinking among employees who then innovate on products and services
that are groundbreaking (Stier, 2023; Harnish and Collins, 2018).
In addition, Kaya et al., (2020) assessed the democratic leadership style at Apple fosters open
communications and transparency whereby all employees regardless of their level can
communicate any issues or concerns. This inclusive culture not only builds trust and reciprocity
but also cultivates a climate of personal progress among the organization members. On the other
hand, Syamsidar et al. (2021) concluded that the democratic leadership style at Apple is also
associated with some challenges and weaknesses. Although inclusivity is a core value, the
decision-making process may be frustratingly slow and bureaucratic because of all that
consensus building involves as well as input from various stakeholders. Additionally, according
to Holbeche (2023) in a fast-paced industry like technology, the democratic leadership may
hinder the Apple Company’s ability to respond swiftly to market dynamics and emerging trends.
Furthermore, the emphasis on consensus-building inadvertently stifles dissenting voices or
alternative viewpoints, potentially leading to groupthink and conformity within the
organizations. This could limit the exploration of unconventional ideas and hinder innovation in
the long run (Chandy, 2023).
Apple VS Samsung Leadership Style
Aspect Apple Samsung
Democratic Leadership Transformational Leadership
Decision-Making Emphasizes consensus-building and Drives decisions through a clear
inclusivity in decision-making vision set by leadership.
 processes.
Employee Values employee contributions and Inspires employees to align with the
Motivation encourages idea-sharing. company's vision, fostering pride
and purpose.
Innovation Promotes creativity and innovation Drives change and innovation,
through collaboration. facilitating continuous
improvement.
Flexibility Prioritizes adaptability, encourages Promotes proactive responses to
experimentation, and learning from challenges, fostering a culture of
failures. continuous improvement.
Organizational Cultivates a culture of creativity and Fosters a culture of excellence,
Culture innovation. emphasizing alignment with the
company's vision.
Table 1. Apple VS Samsung Comparison
Steve Jobs, co-founder of Apple, was known for his democratic leadership style. He encouraged
collaboration and valued input from his team members (Butler, 2020). As stated by Leavy (2019)
Jobs believed in fostering a culture where everyone's opinion mattered, leading to innovation and
creativity within the company. Moreover, Kremer, Villamor and Aguinis (2019) analyzed that
Apple Company encourages collaboration and values input from team members. Furthermore,
Apple fosters a culture of innovation and creativity (Cegarra-Navarro et al., 2019). Moreover,
Podolny, and Hansen (2020) claimed that Apple involves team members in decision-making
processes. Additionally, Mashiah (2021) stated that Apple’s team members are motivated to
share ideas and take ownership of their work.
On the other hand, under the leadership of CEOs like Lee Kun-hee and Kim Ki-nam, Samsung
has embraced a transformational leadership style (Zaman, Nawaz and Nadeem, 2020). According
to Dewar, Keller and Malhotra (2022) Transformational leaders at Samsung inspire and motivate
employees by setting a clear vision for the future and encouraging them to strive for excellence.
As per Radić (2021) Samsung’s decision-making is driven by the vision set by the leader. Also,
Hemmert (2020) stated that Samsung’s leaders inspire employees to align their decisions with
the company's overarching goals. In addition, Samsung employees are inspired to contribute to
the company's vision.
Future Development Issues
Apple faces several key challenges for its future
development including intensified competition, and
changing consumer preferences which are significantly
impacting its sales, particularly in critical markets like
China. Intensifying competition from companies like
Samsung, Google, and Huawei poses a threat to Apple's
market share and innovation dominance. According to Mo and Goh (2024) Apple’s iPhone sales
are declining in China attributed to Huawei's fierce competition, mirrors Nokia's loss of market
share and innovation relevance amidst smartphone rivalry. Moreover, Roth (2023) underscores
another pressing challenge for Apple Inc. the shifting consumer preferences driven by the
company's delayed advancements in AI features compared to rivals like Google and Samsung.
Failure to address these challenges could potentially lead to a downturn in Apple's fortunes,
possibly resulting in company flop or even bankruptcy, akin to the experiences of Nokia and
BlackBerry in the past.
Handling Business Challenges
Company’s leadership has serious hurdles to jump over and that includes intensified competition
and a change in tastes of new generation consumers which will ensure the future of Apple’s
business. Effective leadership strategies, according to Vassolo and Weisz (2022), can be a key
aspect in managing these challenges and maintaining Apple’s position as the leader in its market.
As Flaviano (2021) puts it, to withstand competition that is set to stiffen further from rivals such
as Samsung, Google and Huawei Apple’s leadership should make innovation and agility their
primary focus. In studies by Fainshmidt et al., (2019), it is noted that dynamic capabilities are
very important to organizations operating in rapidly changing industries because they illustrate
the importance of innovation and strategic flexibility. By relying on such companies as Amazon,
which follows the massive innovation strategy across multiple product lines, Apple can develop
innovative products for customers and stay one step ahead of its rivals with an ability to respond
adequately to the dynamic market environment (D’Ippolito et al., 2019).
As per Dwivedi et al., (2021), changing consumer preferences need a leader which is ready to
take proactive leadership in matters of technological advancements, especially those that are
related to features such as AI. Gil-Gomez et al., (2020) research emphasized the importance of
innovation and how it could help keep a market relevant and be able to meet the changing needs
of consumers. The leadership can also learn from the likes of Microsoft that revived its product
line with strategic investments in technologies that leveraged advanced AI-driven technologies
like Cortana and Azure (Ghourpade, 2020).
Additionally, Hynes and Mickahail (2019) recommended that Apple’s leaders ensure cultivation
of a culture of collaboration and creativity to drive cross-functional teams in the creation of
innovative solutions to respond positively to the market challenges. The works of Barlette and
Baillette, (2022) emphasize the value of partnership in decision-making and organisational
agility in the dynamic market environment. Apple may learn from successful organizational
collaboration present in Google – a company known for its highly creative and collaborative
work culture; thereby, promoting innovation and responsiveness (Amit and Zott, 2020).
Moreover, an emphasis on consumer-based strategies among Apple’s leadership is necessary to
most effectively understand and predict changing consumer taste. Cooper (2019) is a research
that brings out the focus on customer insights and how these insights drive product development
as well as marketing strategies. By using the customer feedback mechanisms and market
research, Apple will be able to customize its products to fit with the changing consumer needs
and style (Kopalle, Kumar, and Subramaniam, 2020).
Task 2 Leadership for Performance
Balance Score Card
Perspective Objective Key Performance Indicator
Financial  Achieve revenue growth  ROI: 21%
 Enhance shareholder value  Cash Flow: $86.3 billion
 Increase net profit  Net Profit: $57.4 billion
Customer  Enhance customer satisfaction  Customer Satisfaction: 82%
 Improve customer retention  Customer Retention: 90%
 Enhance service and quality  Service and Quality Performance:
performance 95%
Internal Business  Improve process alignment  Process Alignment: 85%
 Increase process automation  Process Automation: 70%
Innovation and  Enhance job satisfaction  Job Satisfaction: 80%
Learning  Improve employee retention  Employee Retention: 85%
  Increase training opportunities  Training Opportunities: 90%

Table 2: Balance Score Card for Apple

For Apple, these balanced scorecard perspectives and objectives reflect its strategic focus on
financial stability, customer satisfaction, operational efficiency, and employee development.
According to Lu et al., (2023) financially, Apple aims to sustain revenue growth, enhance
shareholder value, and increase net profit. With an ROI target of 21%, Apple aims to ensure that
its investments yield substantial returns. The $86.3 billion cash flow and $57.4 billion net profit
reflect the company's robust financial performance, driven by its innovative products and
services.
Moreover, Weinstein (2020) stated that in terms of customer perspective, Apple prioritizes
enhancing customer satisfaction, improving retention, and maintaining high service and quality
standards. Achieving an 82% customer satisfaction rate underscores Apple's commitment to
delivering exceptional user experiences, while the 90% customer retention rate reflects the
loyalty and trust customers place in the brand. Apple's service and quality performance at 95%
further solidifies its reputation for excellence in product delivery and support.
In addition, Sharma and Joshi (2023) evaluated that Apple focuses on improving process
alignment and increasing automation to enhance operational efficiency. With an 85% process
alignment score, Apple ensures that its internal workflows and systems are streamlined and
cohesive, fostering productivity and effectiveness. While process automation stands at 70%,
Apple continues to invest in technology to optimize its operations further (Podolny and Hansen,
2020).
As stated by Kalyanamitra, Saengchai and Jermsittiparsert (2020) in terms of innovation and
learning, Apple seeks to enhance job satisfaction, improve employee retention, and increase
training opportunities. With an 80% job satisfaction rate, Apple prioritizes creating a conducive
work environment where employees feel fulfilled and motivated. An 85% employee retention
rate indicates the success of Apple's efforts in retaining top talent, crucial for sustaining
innovation and growth. Additionally, Apple's provision of training opportunities at 90% reflects
its commitment to nurturing employee skills and fostering continuous learning (Leise et al.,
2019).
Leadership for Performance
Kumar (2019) defined that “Leadership for performance” is a leadership approach focused on
optimizing organizational effectiveness, enhancing employee engagement, and achieving
strategic objectives. It involves leaders inspiring, motivating, and empowering their teams to
maximize individual and collective contributions toward common goals. In the context of
Apple's objectives, leadership for performance plays a crucial role in driving financial growth,
enhancing customer satisfaction, improving internal processes, and fostering innovation and
learning (ALMASKARI et l., 2021).
To achieve its financial objectives, Apple can adopt leadership practices that prioritize strategic
decision-making, resource allocation, and performance measurement. Transformational
leadership, as proposed by Khan, Amin and Saif (2022), emphasizes visionary leadership,
inspirational motivation, intellectual stimulation, and individualized consideration. Manu (2022)
stated that Tim Cook, as a transformational leader, can articulate a compelling vision for revenue
growth, enhance shareholder value, and increase net profit. By fostering a culture of innovation
and accountability, Cook can inspire employees to pursue excellence and embrace change,
aligning their efforts with Apple's financial objectives.
In addressing customer satisfaction and retention, Apple can leverage servant leadership
principles. Servant leadership, as conceptualized by Sfetcu (2021), emphasizes empathy,
humility, stewardship, and empowerment. By prioritizing customer-centricity and quality,
Apple's leaders can cultivate a service-oriented culture where employees are empowered to
exceed customer expectations. For instance, empowering frontline employees to make decisions
and resolve customer issues promptly can enhance service and quality performance, driving
customer satisfaction and loyalty, as demonstrated by companies like Amazon and Zappos
(Mandal, 2021).
According to Doz (2020) improving internal processes requires leaders to champion
organizational alignment and agility. Transactional leadership, characterized by contingent
reward and management-by-exception, can be effective in optimizing processes and promoting
accountability (Ali and Khan, 2023). Through clear expectations, performance feedback, and
rewards tied to process improvements, Apple's leaders can enhance process alignment and
automation, streamlining operations and enhancing efficiency. Companies like Toyota, known
for their Toyota Production System, exemplify how transactional leadership principles can drive
continuous improvement and operational excellence (Yamamoto, Milstead and LIoyd, 2019).
Furthermore, Rao Jada, Mukhopadhyay and Titiyal (2019) stated that innovation and learning
objectives necessitate a supportive and empowering leadership approach. Authentic leadership,
which emphasizes self-awareness, transparency, ethical behavior, and relational transparency
(Yamak and Eyupoglu, 2021), can foster a culture of innovation and learning. Leaders at Apple
can create psychological safety, encourage experimentation, and provide resources for skill
development and training, promoting job satisfaction, employee retention, and learning
opportunities. Asexamplified by Abdulazizov (2023) Google's "20% time" policy allows
employees to pursue passion projects, demonstrates how authentic leadership fosters innovation
and employee engagement.
Financial Statements

(Apple, 2023)
Apple's financial report for the fiscal year 2023 ended on September 30, 2023, shows a decline in
net sales from $394.3 billion in 2022 to $383.3 billion
in 2023. The company's net income also decreased
from $99.8 billion in 2022 to $97 billion in 2023.
Apple's iPhone category remains the largest contributor
to its net sales, accounting for $200.6 billion in 2023.
The Americas region is the largest contributor to
Apple's net sales by reportable segment, accounting for $162.6 billion in 2023. Apple's gross
margin increased from $170.8 billion in 2022 to $169.1 billion in 2023. The company's operating
expenses increased from $51.3 billion in 2022 to $54.8 billion in 2023. Apple's earnings per
share increased from $6.11 in 2022 to $6.13 in 2023.

(Apple, 2023)
Apple's balance sheet for the period ending September 30, 2023, shows that the company has a
total of $352.6 billion in assets, which is almost the same as the previous year's balance sheet.
The company's current assets include cash and cash equivalents, marketable securities, accounts
receivable, vendor non-trade receivables, inventories, and other current assets. The company's
non-current assets include marketable securities, property, plant and equipment, and other non-
current assets. Apple's total liabilities and shareholders' equity are $290.4 billion and $62.1
billion, respectively. The company's liabilities include accounts payable, other current liabilities,
deferred revenue, commercial paper, term debt, and other non-current liabilities. The company's
shareholders' equity includes common stock and additional paid-in capital, accumulated deficit,
and accumulated other comprehensive loss.
 (Apple, 2023)
Apple's condensed consolidated statements of cash flows for the fiscal year 2023 ended on
September 30, 2023, shows that the company generated $110.5 billion in cash from operating
activities, which is a decrease from $122.2 billion in 2022. The company's cash generated by
investing activities was $3.7 billion in 2023, compared to a cash outflow of $22.4 billion in 2022.
Apple's cash used in financing activities was $108.5 billion in 2023, compared to $110.7 billion
in 2022. The company's cash, cash equivalents and restricted cash, ending balances increased
from $24.9 billion in 2022 to $30.7 billion in 2023. Apple paid $18.7 billion for income taxes
and $3.8 billion for interest in 2023.
Task 3 Ethical Leadership
Ethical Issue of Apple
Apple faces significant ethical issues
related to human rights violations and
tax avoidance (Lenz, 2020). Regulators'
findings that Apple's secrecy violates
workers' rights indicate concerns about
labor practices in its supply chain. Reports of poor working conditions, excessive overtime, and
low wages in Apple's supplier factories raise ethical questions about the company's responsibility
to protect workers' rights and ensure fair treatment (Regulators Find Apple’s Secrecy Violates
Workers’ Rights, 2024). In response to poor working conditions Apple provided extensive
opportunities in its supply chain and implement stricter omission and auditing processes to
confirm compliance with ethical standards. This response of Apple aligns with the "Social"
factor of the Triple Bottom Line (TBL) theory, highlighting corporate social responsibility and
ethical labor practices in its supply chain.
Similarly, according to (CNN, 2023) Apple's tax avoidance practices have drawn scrutiny and
criticism. Being highlighted as one of the top seven tech giants paying too little tax in the UK
and facing a $14 billion tax evasion lawsuit
from the EU underscores the ethical
implications of aggressive tax planning.
While tax avoidance itself may not be
illegal, it raises moral concerns about fairness, social responsibility, and the company's
contribution to public services and infrastructure. Apple has defended its tax practices, stating
that it pays all required taxes and complies with the laws of the countries in which it operates.
Apple’s response to the challenge falls under the “Economic,” i.e., financial aspect of the TBL
theory, which stresses compliance with laws regarding taxation.
Furthermore, Abugre and Anlesinya (2020) also note the role of CSR and ethics in multinational
corporations as follows: The ethical issues of Apple show us the difficulties that companies meet
in trying to put profit goals and social, environmental Ethical violations can hurt reputation,
break stakeholders’ confidence, and the firm faces legal and financial liabilities. Companies such
as Amazon and Google have been criticized for their labor practices and issues with tax
avoidance strategies. These cases show the bigger systemic problems in tech industry related to
ethical behavior and corporate responsibility (Ciganskis, 2023).
Recommendations
To avoid human rights violation Apple should improve transparency and accountability along its
supply chain through effective monitoring mechanisms and regular audits. This entails
collaboration with autonomous organizations and NGOs to ensure compliance with labor
standards, and any violation must be promptly corrected. To avoid labor abuses, She (2022)
emphasizes supply chain transparency and accountability. This aligns with the Utilitarian
Approach to ethical decision-making. This approach prioritizes actions that result in the greatest
good for the greatest number of stakeholders, emphasizing the importance of ensuring fair labor
practices and human rights standards throughout the supply chain.
To mitigate the issue of tax avoidance Apple should come up with a socially responsible strategy
for tax planning that is founded on ethical principles and societal needs. This involves describing
the tax practices and engaging in a positive deliberation with regulative bodies and tax
authorities to solve queries and ensure adherence to the correct legislature. At the same time,
Nkobane (2023) proved that some of the companies such as Starbucks and Google are being
accused of tax evasion but these companies struggle to raise transparency standards and pay full
taxes. This recommendation for Apple to develop a socially responsible tax strategy is consistent
with the approach called Virtue Approach to ethical problem-solving. This approach focuses on
virtuous character building based on principles of fairness, openness, and responsibility. If Apple
is to implement these measures, it can show its moral duty that it has made significant
improvements in the society and nature.
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