Hon Hai Technology Group (Foxconn) statement

regarding report: “Passively Funding Crimes Against Humanity”

22 November 2022

• Foxconn categorically refutes allegations of forced labor use in our operations.
• We are aware that past reports by well-regarded research institutions have connected Foxconn to forced labor issues. We have responded to such reports, such as in March 2020 related to a report by the Australian Strategic Policy Institute (ASPI), refuting alleged connection to forced labor issues. The ASPI report is a key citation in the public domain that the current report: “Passively Funding Crimes Against Humanity” bases its findings. [See supplementary context below]
• Foxconn understands that the current report’s “information is based entirely on public records and corporate declarations. The companies listed … may have changed their labor recruitment strategies or sourcing, but they have not announced those changes publicly and therefore should be assumed to continue to engage in labor transfers (or sourcing from companies that do) until they publicly declare otherwise and provide supporting evidence.” [p13]
• Foxconn welcomes stakeholders and concerned parties to discuss with us, at any time, such important issues. We believe that direct exchanges can contribute to transparency and accuracy on issues that are critical for the global community. We hope that going forward Foxconn will be provided the opportunity to respond to critical issues ahead of a report's release to allow for fair representation in the final assessment.
• Foxconn closely follows labor issues and policies around the world to stay updated on best practice and key concerns. This year, the Group has noted the August 2022 report by the UN OHCHR and the February 2022 report by ILO. There is no mention of Foxconn or related partners in either reports.
• Foxconn’s key customer conducts and reviews regularly any possible forced labor practices in its supply chain. In its 2022 Progress Report, the customer stated, “we found no instances where anyone was forced to work in our supply chain.” [p42]
• Foxconn will continue to proactively engage with stakeholders to be clear about Foxconn’s principles toward its employees of legality, fairness, impartiality, equality, voluntary actions, honesty, and credibility, as we have publicly stated in our most recent Sustainability Report [p47].
• Foxconn is aware that public domain information gets amplified as it passes from news headlines, social media platforms, search engines and news portals. In this dissemination, firsthand information becomes diluted and inaccurate, causing unnecessary reputational damage. We urge stakeholders to source firsthand information where possible, including connecting directly with Foxconn to ensure timely and accurate reporting on important issues.

Supplementary context:

• Regarding the ASPI report in 2020, the citation about 560 Xinjiang labourers being transferred to work in factories in central Henan province (endnoted in the 2020 report as: ‘Henan aids Hami City, Xinjiang in advancing poverty alleviation’ (河南援疆助力哈密 固提升脱贫攻坚), Hami City Party Building Net (哈密市党建网), 6 September 2019, online) has continued to be re-cycled, despite findings the original document was a government promotional advertisement of a transfer that did not take place. The original document was subsequently scrubbed from the Internet except as a webpage capture.
• Due to the seriousness of the allegation at the time in the ASPI report, Foxconn conducted a comprehensive internal investigation and, separately, submitted to a third-party audit to clear reputational damage. Both investigation and audit found no so-called Xinjiang workers. The Party-Construction website retracted the self-advertising article, disappearing it from the Internet.
• The third-party audit is subject to Responsible Business Alliance (RBA) confidentiality and subject to RBA Validated Audit Agreement. However, Foxconn can share the following from the third-party audit:
  • The audit took place from May 7, 2020 to May 8, 2020 at Foxconn’s Zhengzhou campus. Two RBA Auditors spent a total of four person-days onsite. It was a closure audit of all manufacturing buildings and common spaces (canteen, dormitory).
  • Among the conclusions related to allegations of forced labor issues, the following were found as verbatim in the Closure Validated Audit Report:

• • Any type of forced, involuntary or exploitative prison, indentured, bonded (including debt bondage), trafficked or slave labor is not used.
  • Adequate and effective policy and procedures are established ensuring that any form of forced, bonded, involuntary or exploitative prison, trafficked or slave labor is not used.
  • There are no unreasonable restrictions on the movement of workers and their access to basic liberties.