It's tax time.
Perhaps like columnist James B. Stewart in today's New York Times, http://www.nytimes.com/2012/01/28/business/a-personal-and-painful-tax-reality-common-sense.html?_r=1&ref=business you are curious about your effective tax rate in the wake of Republican primary squabbles? Or rather like me, you are simply rooting around, pulling together the bits and pieces of paper that describe your income for the year recently ended. I suspect for many of us, this is the one time each year that you really look at those financial account statements that arrive regularly in real and virtual mailboxes.
I couldn't help notice that my little shares of Apple, Inc closed yesterday at just under $450 a share, retaking their position, according to the Wall Street Journal, as the "most valuable company." http://online.wsj.com/article/BT-CO-20120125-710558.html.
Nearly a dozen years ago, those of us who were big fans of Apple products were thought of as simple-minded or simply incurably romantic, with an impractical attachment to products that were beautifully designed and had user interfaces that were, well, simple-to-use. I remember vividly the conversation I had with my stockbroker at the time, calling from my car and suggesting he purchase some shares on my behalf. He disagreed, Apple was too pricey. The recently introduced iPod http://www.youtube.com/watch?v=kN0SVBCJqLs was a fad.
I countered, "indulge me. I just want some."
The small investment turned out "pretty good." And in the wake of recent news coverage of Apple's supply chain challenges, I wrestle more-and-more with my continued longing for all things Apple. http://www.nytimes.com/2012/01/26/business/ieconomy-apples-ipad-and-the-human-costs-for-workers-in-china.html?src=mv&ref=general.
How might this relate to sustainicity, the notion that social capital and economic capital are linked? How might it affect an innovative company like Apple and its ability to create long term value for investors like me?
I offer a subtle-yet-powerful example.
As the global media lit up with the story of Chinese factory workers and Apple's supply chain, accompanying a link to January 25th article, I saw this email from a savvy sophomore at one of the nation's elite innovation institutes, "Maybe you've seen this or (sic) might be in the paper tomorrow... but yeah. Do you still want an iPad?"
If companies like Apple do not appreciate the economics of reputational risk, they may want to ask their future workforce. Great products are built on equally great supply chains. They merit nothing less. Manufacturing costs saved in developing nations may offset the cost of brilliant design and savvy innovation, for a time. But when a 19-year-old techno-wiz asks, "Do you still want an iPad?" Apple investors around the globe may feel a little chill.
U.S investors may even want to take their gains and enjoy the 15% tax rate while it lasts.
Are you listening, Apple?
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