An investigative series by the New York Times and a performance piece by Mike Daisey featured on This American Life have put the spotlight on Foxconn, the Taiwanese company whose massive Chinese factories manufacture some of the world's most popular consumer electronics.

As well as working with companies like Dell, Motorola, Nokia and Hewlett-Packard, Foxconn assembles popular Apple products like the iPhone and iPad.

Here's a quick look at what we know about Foxconn. (The company disputes workers' accounts of abusive conditions. In a 2010 company report, Foxconn said it promotes "employee respect, an atmosphere of trust, and personal dignity.")

Working for Foxconn

1.2 million: number of workers employed by Foxconn in China, according to the New York Times.

40: Estimated percent of the world's consumer electronics manufactured by Foxconn.

7: seconds it takes Foxconn's workers to complete a single step of their work, according to a survey cited by the New York Times.

12: Hours in a typical work shift, according to interviews with Foxconn employees.

83.2: Average hours of overtime worked each month, according to a 2010 survey of Foxconn employee.

13: age of a Foxconn employee Mike Daisey interviewed outside the gates of a Foxconn plant in Shenzen.

91: cases of underage labor found by Apple's audits of its suppliers in 2010, the year Daisey visited China.

3,000: number of workers Foxconn could hire overnight, according to Apple's former worldwide supply demand manager.

10-20: percent estimated monthly turnover in Foxconn's workforce.

$7,500: amount founder Terry Gou used to start the anchor company of Foxconn Technology Group in 1974, according to the company website.

$5.7 billion: Terry Gou's estimated net worth as of March 2011.

Living Conditions

230,000: number of workers at "Foxconn City" in Shenzen, according to the New York Times.

13: tons of rice prepared each day at the central kitchen at Foxconn City.

$0.65: meal allowance for dinner at the Foxconn City canteen in 2010.

2: number of free swimming pools there, according to The Telegraph, which noted that the pools "are said to be quite dirty."

70,000: number of workers at Foxconn's Chengdu plant who live in company dorms, according to the New York Times.

20: number of employees sometimes packed into a three-room apartment.

200: Reported number of police officers who responded to a Foxconn dormitory riot.

Deaths

17: Number of reported suicides of Foxconn workers in China between 2007 and February 2011, according to Wired. Eleven workers died after jumping off buildings in the Foxconn Campus in Shenzen, which were then draped with preventive netting. (Wired noted that the rate actually seems to be below China's national averages.)

70: number of psychiatrists employed by Foxconn to prevent suicides, according to a 2010 announcement by CEO Terry Gou.

100: Estimated number of employees at a Foxconn factory in Wuhan who stood on the roof of a factory building this month to protest working conditions and wages. Several threatened to commit suicide, according to the New York Times.

$450: monthly salary a worker involved in that protest said employees had been promised for moving from the Foxconn campus in Shenzen to one in Wuhan.

34: continuous hours a Foxconn employee worked in 2010 before he collapsed and died, according to media reports.

4: workers killed last year by an explosion at a Foxconn factory in Chengdu, China that assembles iPads.

$22: approximate daily salary earned by Lai Xiaodong, a 22-year-old college graduate, working at a Foxconn factory in Chengdu, China, according to the New York Times.

$150,000: approximate amount the company wired Lai's family after he was killed in the aluminum dust explosion.

ProPublica is an independent, non-profit newsroom that produces investigative journalism in the public interest.   This article is republished with permission under a Creative Commons license.

This post is based on the executive summary of a Council of Institutional Investors white paper which was prepared by Robin A. Ferracone and Dayna L. Harris, Executive Chair and Vice President, respectively, at Farient Advisors, LLC; the white paper is available here.

Advisory shareowner votes on executive compensation were the big story of proxy season 2011, the inaugural year for “say on pay” at most U.S. public companies. The Dodd-Frank Wall Street Reform and Consumer Protection Act, which President Obama signed into law in August 2010, requires U.S. public companies to provide their shareowners with a non-binding vote to approve the compensation of senior executives. The Securities and Exchange Commission’s (SEC) implementing rule, adopted on Jan. 25, 2011, requires say-on-pay votes to approve the compensation of the named executive officers (NEO) at larger companies at least once every three years. The SEC granted smaller companies a two-year exemption.

Say on pay gives shareowners a voice in how top executives are paid. Such votes are also a way for a corporate board to determine whether investors view the company’s compensation practices to be in the best interests of shareowners. Say-on-pay votes are purely advisory; U.S. companies are not required to change their executive compensation programs in response to the outcome. But SEC rules do require that in subsequent proxy statements, companies discuss how the most recent say-on-pay voting results affected their executive compensation decisions and overall programs. Such follow-on comments are to be included in the Compensation Discussion and Analysis (CD&A) section of the proxy statement.

Advisory votes on pay are not a new concept. Say on pay has been widely discussed in the United States as a way to hold directors accountable for runaway executive compensation for close to a decade, ever since the Enron (2001) and WorldCom (2002) scandals. The United Kingdom adopted mandatory say-on-pay votes in 2002, and Australia followed in 2004. Two U.S. companies — AFLAC and RiskMetrics — voluntarily held say-on-pay votes starting in 2008, with Motorola following in 2009, in response to strong investor support for shareowner resolutions requesting annual advisory votes on pay. The U.S. government required more than 350 companies that received federal bailout assistance after the 2008 global financial crisis to give their investors advisory votes on executive compensation, beginning with proxies filed after February 2009.

Analyzing Say on Pay

The Council of Institutional Investors, a leading advocate for say on pay, engaged Farient Advisors to analyze what motivated investors to vote against say on pay at companies where the proposal failed to receive majority support at 2011 annual meetings. The Council believes the report will benefit active investors by identifying compensation practices where support for change is greatest. It also could help them target initiatives for improved pay practices and provide useful input for structuring their voting policies. Companies will benefit, too, from knowing which compensation practices their owners view as detrimental to long-term shareowner value.

Between January 1 and July 1, 37 say-on-pay proposals fell short of majority support. Another 37 companies garnered significant, though less-than-majority opposition, with “against” votes of 40 to 50 percent. While 37 “failed” votes is a tiny fraction (less than 2 percent) of the 2,340 say-on-pay votes at U.S. companies in the first half of the year, the total was surprisingly large compared with the track record of say on pay in other countries.

Public attention has focused on the relatively high number of “failed” say-on-pay votes (proposals that failed to win majority investor support), the impact of proxy advisory firm recommendations on shareowner voting, the reasons for “against” vote recommendations by proxy advisers and, and most recently, shareowner derivative lawsuits at companies where say on pay garnered majority “against” votes. It is clear from our interviews and public filing research that some companies have changed or promised to change their pay levels and programs in anticipation of a strong vote against their say-on-pay proposals, or in response to a substantial percentage of “against” votes.

The report specifically examines:

• The driving factors that fueled majority opposition to say on pay at 37 companies
• The process investors used to determine how they would cast say-on-pay votes
• The influence that say on pay is having on executive compensation
• Potential next steps for shareowners to consider ahead of say-on-pay votes next year
• Potential next steps for companies where investor opposition to say-on-pay proposals was significant

Farient focused its investigation on advisory votes that failed to win majority shareowner support. Farient interviewed representatives from 19 Council member organizations (both U.S. pension fund and other members) about how they cast say-on-pay votes generally and more specifically at the 37 failed-vote companies. These investor participants consisted mostly of public employee pension systems (58 percent), followed by mutual fund firms (32 percent) and union pension funds (11 percent). (The total may not equal 100 percent due to rounding.)  Collectively, their assets under management exceed $7.9 trillion. Farient also interviewed proxy advisers and solicitors, and consulted its extensive database on executive compensation.

Farient found that investors cast advisory votes against executive compensation at the 37 companies for a variety of reasons, but the factors most frequently cited were:

• A disconnect between pay and performance (92 percent)
• Poor pay practices (57 percent)
• Poor disclosure (35 percent)
• Inappropriately high level of compensation for the company’s size, industry and performance (16 percent)

Other findings include:

• Investors were extremely thoughtful about evaluating executive compensation for say-on-pay votes
• Due to resource constraints, investors used proxy advisory firms’ analyses to varying degrees
• Investors considered multiple factors as well as inputs from various sources in determining their say-on-pay votes
• Investors evaluated performance and pay over multiple years, and focused primarily on total absolute shareholder return (TSR) over one-, three- and five-year periods
• Investors spent the most time and resources analyzing pay at “outlier” companies: those with large disconnects between pay and performance, high overall pay and/or low TSR in comparison to their industry or peers
• Investors focused on CEO pay, rather than the pay of other NEOs, and on the overall “reasonableness” of the level of compensation in view of the company’s size, industry and performance
• Investors mostly regarded the say-on-pay vote as an opportunity to voice their concerns about a particular pay program, not a referendum on directors’ oversight of compensation

Among majority “against” say-on-pay votes, about two thirds had opposition levels of 50–59 percent. The rest had “against” votes of 60–70 percent. About one-fourth (27 percent) were in real estate, homebuilding or construction-related businesses — industries that were hit hard in the economic downturn and mostly are still hurting. About one-fifth (19 percent) were energy-related companies. Nearly half were large companies, with annual revenues greater than $1 billion.

Moving Forward

This first year of mandatory say on pay has been a learning experience for all participants. Farient encourages investors to conduct a “post-mortem” of their voting processes, including an assessment of any additional resources needed to evaluate say-on-pay proposals fairly and efficiently. Concerned investors should follow up to see what steps, if any, companies take in response to failed say-on-pay proposals, and consider appropriate action.

Farient also offers two critical areas for improvement in deciding how to cast a say-on-pay vote:

• TSR should not be the sole filter investors use to determine which companies’ pay plans deserve the most scrutiny. Problematic pay practices lurk at mediocre to modestly performing companies, too
• Assessing performance-adjusted pay — compensation that top executives could receive after performance is taken into account — and in particular the performance-adjusted value of equity — is more appropriate than focusing on the grant date value of equity incentives. The value on the date of grant, as determined by the stock price that day for shares (or options, using an options pricing model), does not reflect the compensation that executives ultimately earn

Companies that failed to win majority support for say-on-pay proposals, or that garnered substantial opposition, should reach out to key investors and engage them in dialogue about executive pay programs. They should also make sure their pay disclosures are clear and thoughtful and that their compensation programs are aligned with company performance. That means having a combination of pay that is sensitive to changes in performance, pay levels that are appropriate overall, and a substantial proportion of pay that is performance-based. In particular, companies should consider setting the magnitude of pay changes in response to performance, so that the changes swing proportionately with strong or weak performance.

In Closing

Legislation has forced both investors and companies to pay more attention to executive compensation. Compensation committees and boards have become much more thoughtful about their executive pay programs and pay decisions. Companies and boards in particular are articulating the rationale for these decisions much better than in the past. Some of the most egregious practices have already waned considerably, and may even disappear entirely.

Say on pay is a non-binding advisory vote. Investors agree that they do not want to dictate executive pay arrangements. Rather, they want to ensure that the executive pay programs of their portfolio companies incentivize executives to increase shareowner value for the long term. Moreover, if the pay programs are not benefitting long-term owners, investors want the ability to influence their portfolio companies to make the necessary changes. This seems to be what say on pay is all about.

Ann Yerger is Executive Director of the Council of Institutional Investors. This post is based on the executive summary of a CII white paper which was prepared by Robin A. Ferracone and Dayna L. Harris, Executive Chair and Vice President, respectively, at Farient Advisors, LLC; the white paper is available here.

This article was first published on the Harvard Law School Forum on Corporate Governance and Financial Regulation and is re-published with the author's permission.

Dear EarthTalk: OK, so are cell phones emitting dangerous radiation or not? If so, which phones are safer that others and what do we do to minimize exposure? -- Luke Alderman, Santa Fe, NM

The jury is still out as to whether or not the radiation emitted by cell phones can cause negative health effects for callers. Mobile phones emit signals to communicate with cellular towers via radio waves, which are comprised of radio-frequency (RF) energy, a form of electromagnetic radiation.

The U.S. Federal Communications Commission (FCC) limits the amount of radiation any phone sold in the U.S. can emit to what it considers a safe level of 1.6 watts per kilogram of body weight (a measure of the energy absorbed by the body when using a wireless device). But some health practitioners are concerned that even this level of exposure may be too high, resulting in people unwittingly exposing themselves to potentially harmful radiation every time they make or take a call.

Such radiation is known to heat up living tissue it comes into close contact with by a fraction of a degree, but this level of temperature increase is less than that caused by exposure to direct sunlight, and the brain’s blood circulation typically disperses this excess heat quickly by increasing local blood flow.

Some recent studies have found higher risks for brain and salivary gland tumors among people using cell phones for 10 years or longer, while other research has found little if any risk. Other research has looked at the reproductive, cognitive and sleep effects of RF energy at levels similar to what cell/smart phones emit. Results have been mixed. More studies are now underway to resolve whether or not cell phones are safe for people to use, but some electronics manufacturers aren’t waiting around to cut down on the radiation emissions of the phones they make and sell.

If you are in the market for a new cell phone, check out the nonprofit Environmental Working Group’s (EWG’s) rundown on which of the thousand or so popular cell/smart phone models give off the most and least radiation. Levels vary widely, from as little as 0.3 to the legal limit of 1.6 watts per kilogram of body weight. Sanyo’s Katana II, Samsung’s Rugby, Nokia’s 7710, and the Blackberry Storm, among others, get top marks from EWG for giving off lower amounts of radiation (in the 0.3 range). Meanwhile, more than a dozen different cell/smart phones (including some of the most popular models such as Motorola’s Droid, Blackberry’s Bold 9700, LG’s Chocolate Touch and HTC’s Nexus One by Google) are categorized as “worst” by EWG for giving off larger amounts of radiation (pushing the 1.6 limit). Apple’s iPhone 3Gs is in the middle of the spectrum, leaking between 0.52 and 1.19, depending on usage.

Regardless of which cell/smart phone you use, you can minimize your exposure to RF radiation by taking a few simple precautions. For one, using a headset (these give off significantly less radiation) or speaker phone keeps the phone itself away from your head. Also, your phone emits far less radiation when used to text instead of call—and the phone isn’t next to your brain when texting—so the more you tap (just not while driving, please!) instead of talk the better. Also, a poor signal (fewer bars) means that your phone has to work harder—and emit more radiation—to connect up to a wireless tower, so wait to make that call until you are somewhere with a stronger connection.

SEND YOUR ENVIRONMENTAL QUESTIONS TO: EarthTalk®, c/o E – The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; earthtalk@emagazine.com. E is a nonprofit publication. Subscribe: www.emagazine.com/subscribe; Request a Free Trial Issue: www.emagazine.com/trial.

The vote, reported by RiskMetrics Group, a proxy and governance research firm, marks the first time that a U.S. company has failed to earn majority support from shareholders during a non-binding vote on compensation. RiskMetrics said Illinois-based Motorola was one of only a handful of U.S. issuers that last year had less than 65 percent for its pay practices.

The non-binding vote is likely to result in a dialogue between shareholders and the company.  "The company takes these matters very seriously and will be engaging with our shareholders to get a better understanding of any specific concerns they may have about our compensation policies and procedures," a Motorola spokeswoman told The Wall Street Journal.

Prior to the vote, The Corporate Library, a governance research firm, expressed concern regarding Motorola’s co-CEO leadership structure because it “ultimately seems to pay two executives at relatively high rates of compensation.”

The Corporate Library said it was “particularly concerned with co-CEO Sanjay K. Jha’s inducement award pursuant to his original employment agreement of 2008. As part of his golden hello, Mr. Jha received a mega mega-grant of 16,594,884 stock options and a mega-grant of 3,667,422 restricted stock units. On top of that, he also received a guaranteed $1.2 million bonus in 2009 and a guaranteed $2.4 million bonus in 2008. Contractually guaranteed bonuses do nothing to align executive compensation with a pay-for-performance philosophy.”

While Motorola’s co-CEO structure is intended to facilitate the successful separation of Motorola into two independent, publicly-traded companies, The Corporate Library said, “we think shareholders would benefit if the co-CEOs were to be installed after the successful separation and not before.”  In fact, the planned separation has now been delayed until at least the first quarter of 2011. In the event that there is no separation, Mr. Jha will be entitled to a cash payment of $38 million, according to The Corporate Library.

Some 55 publicly-held U.S.-based companies have now voluntarily agreed to hold annual advisory shareholder votes on executive compensation, according to shareholder advocates who have been pushing for adoption of the practice.

The number of companies with so-called “say-on-pay” votes has increased from only 6 in 2008, when Aflac Inc. became the first to adopt the practice, and 19 in 2009.

Some 55 publicly-held U.S.-based companies have now voluntarily agreed to hold annual advisory shareholder votes on executive compensation, according to shareholder advocates who have been pushing for adoption of the practice.

The number of companies with so-called “say-on-pay” votes has increased from only 6 in 2008, when Aflac Inc. became the first to adopt the practice, and 19 in 2009.

“Say-on-pay holds corporate leaders accountable for unjustifiable CEO pay,” said Gerald W. McEntee, President of the American Federation of State, County and Municipal Employees (AFSCME), a 1.6 million member union whose members participate in public pension funds with combined assets worth more than $1 trillion. “Shareowners are demanding sensible pay for performance programs that discourage excessive risk taking.”

In addition to the 55 companies that have adopted say-on-pay votes, companies participating in the federal government’s Troubled Asset Relief Program (TARP) are also required to have annual advisory votes.

More companies are “stating a higher comfort level with the concept” and there are “several companies whose boards have voted to adopt but have not gone public as yet,” said Timothy Smith, senior vice president of Walden Asset Management and a leader in the say-on-pay movement.  Shareholder proposals urging the adoption of annual say-on-pay votes have been filed at 70 companies in 2010, according to Smith.

Votes Are Advisory

The say-on-procedures voluntarily adopted by companies to date generally establish mechanisms that enable shareholders to annually register their approval or disapproval of compensation for senior management.  In most cases, said Smith, the advisory vote is likely to result in “pro-forma” approval of executive pay packages.  However, if shareholders consider compensation excessive, especially when combined with poor corporate performance, investors could vote to register disapproval.

“It puts the (board’s) compensation committee on notice,” Smith said.  “”A stubborn company could ignore it entirely, but I don’t think they would.”  Smith noted that a majority of shareholders at Royal Dutch Shell last year voted disapproval of management pay, prompting revisions of pay packages.  Advisory shareholder votes on executive compensation are mandated in the United Kingdom.

The coalition pressing for say-on-pay reform includes a number of public pension funds, labor funds, asset managers, individual investors, foundations and religious investors.  Denise L. Nappier, Treasurer for the state of Connecticut, said: “Corporate boards have a primary responsibility to their shareholders – and this includes getting input from them on how well the company’s executive compensation ties pay to performance.  These 50 and counting companies deserve credit for listening to their shareowners.”

Smith said a number of financial firms are among the companies recently announcing they adopted a say-on-pay vote, including American Express, Bank of New York Mellon, Goldman Sachs, JPMorgan Chase, State Street, SunTrust Banks and Wells Fargo. Other adopting companies, according to Smith, include Aflac, Ameriprise, Apple, Bristol-Myers Squibb, CVS Caremark, ConocoPhillips, Hewlett-Packard, Honeywell, Ingersoll-Rand, Intel, Motorola, Valero Energy and Verizon.

Durbin’s initiative follows Google’s announcement that it had been the victim of cyber attacks aimed at gaining access to the email accounts of Chinese human rights activists. Google has said it is considering pulling out of China because of the attacks and what the company called “attempts over the past year to further limit free speech on the web.”

Only two weeks ago, U.S. Secretary of State Hilary Clinton called on American technology companies to make a “principled stand” against attempts at censorship.

Sen. Durbin, Chairman of the Judiciary Subcommittee on Human Rights and the Law, said his hearing next month will feature testimony from Google and other companies about their business practices “in internet-restricting countries,” as well as from high-ranking Obama Administration officials about the Administration’s efforts to promote internet freedom.

“I commend Google for coming to the conclusion that cooperating with the ‘Great Firewall’ of China is inconsistent with their human rights responsibilities,” Durbin said. “Google sets a strong example in standing up to the Chinese government’s continued failure to respect the fundamental human rights of free expression and privacy. I look forward to learning more about whether other American companies are willing to follow Google’s lead.”

Durbin’s letter asks each firm for details of its business in China, and what, if any, measures it will implement to ensure that its products and services do not facilitate human rights abuses by the Chinese government.

This week’s letter also follows up on a letter that Durbin sent last year, urging technology firms to join a voluntary code of conduct known as the Global Network Initiative (GNI). The code of conduct, which regulates the actions of technology firms operating in countries that restrict the internet, has been backed by Google, Microsoft, and Yahoo! and a number of leading socially responsible investment firms.

Durbin’s office said the list of companies that responded to his previous letter included Apple, AT&T, Cisco, Dell, eBay, Facebook, HP, McAfee, News Corp, Nokia, Nokia Siemens, Siemens, Skype, Sprint Nextel, Verizon, Vodafone, Websense.

According to Senator Durbin’s office, companies that did not respond to his previous letter were Acer, Juniper, Toshiba, Twitter; companies that “partially responded” to his previous letter were Fortinet, Lenovo, Motorola.