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After an audit of Apple's suppliers in China, the tech giant has found instances of underage labor, unsafe working conditions and improper handling of toxic chemicals. - 

STEVE CHIOTAKIS: Meanwhile, another American company, also based in California -- Apple is trying to come clean on accusations of labor issues and violations with an annual report on "supplier responsibility." That report focuses on those firms Apple hires to make its popular iPods, iPads, and notebook computers. A lot of those firms are in China.

Marketplace China Bureau Chief Rob Schmitz is on the line with us from Shanghai to talk about the report. Hey Rob.

ROB SCHMITZ: Hey, Steve.

CHIOTAKIS: So what are some of the highlights here?

SCHMITZ: Well, it's certainly a page-turner. First off, Apple discovered 91 children under the age of 16 working illegally at ten Chinese factories making Apple products. It found 42 underage workers on just one assembly line, and Apple says it's terminated the contract with that particular supplier.

Another problem we've heard a lot about was a string of worker suicides at plants run by the company Foxconn, which assembles iPhones and iPads. Apple's report says its chief operating officer Tim Cook visited a Foxconn factory and his team interviewed more than a thousand workers. Soon after, Foxconn establish a 24-hour care center.

CHIOTAKIS: But this is much more than an image problem, right? Apple's had other issues in China beyond those other things.

SCHMITZ: Oh, yes. I spoke with Ma Jun today. He's China's most famous environmentalist, and he's spent the last year trying to get Apple to admit that one of its suppliers had exposed workers to a toxic chemical, poisoning 137 of them. Up until now, Apple ignored this issue and insinuated it didn't even have a relationship with the supplier. Today Apple finally admits its supplier was responsible for this, and it says the supplier is no longer using the chemical that poisoned the workers and it's also paying medical bills. Ma Jun told me he's pleased that Apple is addressing these problems, but he says these problems aren't going away and Apple still needs to do more.

CHIOTAKIS: That's Marketplace China Bureau Chief Rob Schmitz on the line from Shanghai. Thanks, Rob.

SCHMITZ: Thanks, Steve.

Follow Rob Schmitz at @rob_schmitz