Apple’s Core Objective Type --Sweatshop Event Analysis

Financial management begins with the objectives. Objectives are very important to conduct their decisions in organizations. Generally, the objectives could be concluded as three aspects: shareholder wealth maximization, profit maximization and stakeholder. Different company operated differently to meet their objectives. Thus objective should be set ahead of time, and so that the performance could be examined in the end of each fiscal year.

SWM (Shareholder wealth maximization) seems to be the most frequent objective used all over the world. Mangers concentrate themselves on the operations to ensure shareholders' long horizon dividends. To be mentioned, SWM could often be connected with the profit maximization. Although SWM take profit seriously, SWM managers pay more attention to balance risks to persuade their long-term receives, and they communicate their long-term capability on SWM to their investors. Profit maximization managers focus on the decisions to develop their profits, and in some situation, managers would like to put organizations' future on risk to “make up their face” beautifully. Stakeholder managers are interested on the aspects that will influence the organization. Sometimes, in order to take social or community's benefits in account, some companies have to burden more expenses or other actions to reduce their profits.

To research on organization's objectives is the core to analyze their financial management and to find their competences. When they make decision to balance trade-offs, the objectives must be treated as a core. Therefore, objectives could help us to read a company and predict their performance practically.

This week Apple co. could be a target in main newspapers. It is not only because their great achievement on profit and their huge amount of cash in hand, but also they was connected with sweatshop. Their manufacture factory could be one of the most curial companies for workers in the past two years. The world was shocked, for13 people suicide for high pressure and heavy workload. Apple Company tried to communicate to their stakeholders including government, investors and shareholders and tried to save their reputation. However, two year pasted, their actions are limited, so last week, New York Times exposed their curial business. And then, the CEO of Apple promised to supervise their manufacturer's business to ensure their rights and develop their working environment. The reaction of this event is still a promise in words instead of real and actual plans, the reason could be found below.

Last month, the trend for Apple share price keeps an upward trend. And the only fall point happened on the day when news of great cash in hand published. There is no clear reaction of share price for the sweatshop event. Therefore, Tim Cook, the CEO of Apple, did not act so much to readjust their behavior. Cheap labour and quick manufacture are more valuable for Apple than the worker’s benefits, and to ensure their long-term achievements, they should keep their reputation, so they provided promises out. And how and when it could be realized, no one would tell!

According to the details of Apple’s reaction, they should likely be a SWM Company. What they did to the events is to use the minimum cost to save their future, and kept their eyes on middle term development. Speaking for Apple and their investors, it could be a good thing. They would still obtain the low cost manufacture and at the same time, their reputation also has been saved for future develop.