At Apple’s annual shareholder meeting, the company’s investors had to consider more than just how much money CEO Tim Cook and other executives could make — last year, Cook received nearly $99 million in management compensation worth $2 trillion. Instead, some shareholder proposals have raised issues of social and cultural significance, such as forced labor, pay equity, and employee confidentiality agreements. On Friday, for the first time in years, two proposals were actually accepted (via CNET).
Bloomberg reports that shareholders have (unsurprisingly) decided to re-elect the same board of directors and approved the executive compensation package listed in the 2022 filing. They also followed Apple’s recommendation in voting on eight of the ten submitted shareholder proposals, as outlined in SEC 8-K (pdf).
One of the two actions taken was Proposal #10, which focused on non-disclosure agreements, with support from Nia Impact Capital, the Transparency in Employment Agreements (TEA) coalition, and Silenced No More co-sponsor Ifeoma Ozoma. This prompted Apple to prepare a report on the potential risks of its use of secrecy clauses (non-disclosure agreements) in the context of harassment, discrimination and other illegal activities.
Shareholders of Apple Inc. (“Apple”) is asking the Board of Directors to prepare a public report assessing the potential risks to the company associated with its use of confidentiality provisions in the context of harassment, discrimination and other illegal activities. The report must be prepared at a reasonable cost and contain no proprietary or personal information.
In October, I was offered a split agreement with an overwhelming non-disclosure agreement and a pre-written statement as to why I was leaving the company.
I helped make such contracts illegal in Washington state and helped shareholders demand transparency and accountability.
How are your heads now?
— Cher Scarlett #StandWithUkraine (@cherthedev) March 4, 2022
In response, Apple said it added language to all termination agreements for US employees, explicitly noting that non-disclosure clauses do not prevent them from discussing “harassment or discrimination.” However, not all Apple employees are in the US or California, where the No Silence Act now applies. Shareholders want the company to add this wording to their employment agreement because they believe it provides more legal protection than just having it in a Business Conduct Policy.
A preliminary vote announced during the conference call showed that shareholders were slightly in favor of the measure, with 49.3 percent of the vote in favor of it to 49.24 percent, but as Marketwatch notes, abstentions failed to reach the threshold of fifty percent or more in favor. , at first. However, as Apple’s 8-K filed with the SEC reports, Friday’s votes pushed the supporter crowd above fifty percent and won approval.
Nia Impact Capital founder and CEO Dr. Christine Hull, in a statement of victory, said that “NDA makes sense when we need to protect intellectual property or confidential information relating to competition. However, they do not make sense in cases of harassment or discrimination, as they mask problems from other employees and investors.”
The measure was adopted with the support of 54% of the shareholders who took part in the voting.
Another proposal in which shareholders violated the company’s recommendation is proposal number nine, entitled “Audit of Civil Rights.” The Board of Directors was asked to initiate an independent review to measure the “impact of Apple’s policies and practices on the civil rights of the company’s shareholders”, the results and recommendations of which were published on the Apple website.
HAVE RESOLVED that the shareholders of Apple Inc. (“Apple”) calls on the Board of Directors to oversee an independent audit to review the adverse impact of Apple’s policies and practices on the civil rights of the company’s shareholders, in addition to legal and regulatory issues, and to provide recommendations for improving the company’s civil rights impact. Contributions from civil rights organizations, employees, and clients should be taken into account when identifying specific issues to be analyzed. An audit report that is reasonably priced and contains no confidential or proprietary information must be posted on Apple’s website.
Apple opposed the measure, saying it had already met the goals of the proposal through inclusion and diversity commitments, risk assessment, transparent public reporting, and other measures. Shareholders were apparently unconvinced — perhaps they read what employees were saying about the corporate culture, or were unhappy with recent leaks — and took action when it was voted for by 5,125,278,012 people to 4,445,469,491 people.
Investment group SOC was one of three parties to introduce the measure, saying that “Apple’s reputation as an inclusive and fair maker of change is at stake” and mentioning that other companies such as Starbucks, Airbnb and Facebook have conducted similar reviews. IN tweet on fridayThe group said, “A properly conducted civil rights audit will help the company maintain the reputation that Apple has built as an inclusive and fair company.”
Even after approval, the proposals are non-binding, but in a statement to CNBC, SOC Investment Group chief executive Dieter Weizenegger said shareholders typically hold the board accountable when something is passed. Speaking to The Verge, Dr. Hull said the same thing, hoping the result will push Apple to do the work it needs to maintain a good reputation and counter potential workplace abuse.