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Tech: Apple opens suppliers’ plants to audits

Apple says that a nonprofit labor group is conducting an independent inspection of the overseas factories where most iPhones and iPads are built, said Poornima Gupta in Reuters.com. This week, the Washington, D.C.–based Fair Labor Association began interviewing thousands of employees at Chinese plants owned by Foxconn, Apple’s largest supplier, about their working conditions. Foxconn plants have been dogged by reports of employee suicides and injuries, and Apple’s use of the company to build its products has recently come under fire. “The inspections now underway are unprecedented in the electronics industry, both in scale and scope,” Apple CEO Tim Cook said.

Questions have been raised, however, about whether the Fair Labor Association is truly independent and effective, said Steven Greenhouse in The New York Times. Since 1999, the group has inspected more than 1,300 factories in Asia and Latin America, but some labor advocates say its efforts have “barely made a dent in improving working conditions.” Critics also claim that the FLA is not completely independent because it is funded in part by the companies it audits. “The FLA does some good work,” says Scott Nova of the Worker Rights Consortium, but “we’re not seeing” conditions getting better in the supply chains of major brands.

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Markets: Congress bans insider trading

The House of Representatives last week followed the Senate in overwhelmingly passing a bill to ban insider trading on Capitol Hill, said Paul Kane in The Washington Post. Both of the bills would prohibit lawmakers from trading on confidential information learned through their positions, but the versions differ on several key reforms. In particular, the House removed a Senate provision that would require political intelligence firms, which sell information about pending legislation to clients like hedge funds, to register, as lobbyists do. The bills now head to a House-Senate conference to reconcile the differences.

Companies: McDonald’s to phase out sow crates

McDonald’s gave animal-rights advocates something to smile about this week, said Stephanie Strom in The New York Times. The fast-food giant has asked its pork producers to phase out gestational crates, the tiny stalls currently used to house most of the nation’s pregnant pigs. Animal-rights groups say the stalls, which are only 2 feet wide, are inhumane and unhealthy. McDonald’s decision, said Paul Shapiro of the Humane Society of the United States, “does more to put the writing on the wall for the pork industry than anything that’s happened previously.”

E-commerce: Growing pains at Groupon

In its first big test since going public in November, daily-deals site Groupon disappointed investors with its latest earnings report, said Shayndi Raice in The Wall Street Journal. The Chicago-based company posted a $37 million loss for the fourth quarter, amid high spending to support its rapid growth. On a brighter note, Groupon’s revenue for the period more than doubled, to $506.5 million, and the company took pains to calm those skeptical that the business can be profitable. “It’s still the early days,” says Andrew Mason, Groupon’s CEO. “We believe we are on the cusp of a sea change in consumer behavior.”

Companies: Pepsi shifts strategy to challenge Coke

“PepsiCo is trying to put some fizz back into its business,” said Mae Anderson in the Associated Press. The company, which is losing global market share to rival Coca-Cola, will lay off 8,700 employees worldwide and plow $600 million into advertising and marketing for drinks such as Pepsi and Mountain Dew, with an emphasis on reaching customers in North America. Pepsi, like other drink and food companies, is facing rising costs for such commodities as sugar, corn, and aluminum.