Apple investors urge company to submit to civil rights audit

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SAN RAMON, CALIFORNIA (AP) — Apple shareholders have approved a proposal urging the iPhone maker to submit to an independent audit assessing its treatment of women and minority employees, delivering a rare rebuke to a team executive who runs the world’s most valuable company.

The measure passed last Friday at Apple’s annual meeting is non-binding, so the Cupertino, California-based company is not required to adopt the recommendation.

But denying the wishes of its shareholders would put Apple in an uncomfortable position, especially since the company has long presented itself as a champion of civil rights. CEO Tim Cook reiterated that belief on Friday in response to a question from a shareholder during the remote meeting.

“I’ve long believed that inclusion and diversity are essential on their own,” Cook said. “And that a diversity of people, experiences and ideas is the foundation of all new innovation.”

Like other big tech companies, Apple’s workforce — especially in high-paying tech roles — is made up mostly of white and Asian men, an imbalance the industry has been trying to address for many years. . Apple’s board had opposed the shareholder proposal calling for a civil rights audit that will eventually be made public. The company pointed to its recent civil rights advances inside and outside of Apple that made a third-party audit of its practices unnecessary.

Among those initiatives, Apple pledged $130 million to a racial equity and justice fund following the 2020 killing of George Floyd in Minneapolis. The company also said it was increasing pay for women and minority employees while hiring more women, blacks and Hispanics.

An Apple logo adorns the facade of the Apple Store in downtown Brooklyn in New York City. PHOTO: AP

At Friday’s meeting, Cook said Apple has achieved gender pay equity every year since 2017 and now has racial pay equity in the United States (US). He also said that 59% of Apple’s leadership positions over the past year have been filled by people from “underrepresented communities.”

But supporters of the civil rights proposal insisted that Apple was not doing enough, forcing outsiders to investigate recurring reports of sexual harassment, discriminatory practices and other abuses within the company. company, which employs 154,000 people worldwide.

The proposal gained momentum after Apple last year hired a former Facebook product manager, Antonio Garcia Martinez, to join its advertising team – a move that sparked an outcry among employees who hired him. accused of making misogynistic and racist remarks in a 2016 book called Chaos Monkeys. Apple quickly cut ties with Garcia Martinez after the backlash.

Apple also raised widespread privacy concerns last year when it announced plans to scan iPhones for child sexual abuse images. Complaints about this scanning program prompted Apple to backtrack on the plan, but it provided another rallying point for supporters of a civil rights audit.

Most shareholder proposals are overwhelmingly rejected when opposed by the boards of publicly traded companies. This was the case for five other shareholder proposals at Apple’s meeting on Friday.

Apple shareholders have generally been enthusiastic supporters of the company because of the enormous wealth it has created. Apple is currently worth nearly $2.7 trillion, with most of the gains coming in the past two years of a pandemic that has made its products and services even more popular.

Still, the proposal for a civil rights audit of Apple has won support from two consulting firms that often sway the votes of institutional shareholders. Apple did not immediately release details of the voting results, beyond confirming that the measure had been approved. The result “shows that investors want to know whether Apple is making a difference in addressing potential harm to key stakeholders from its products and policies,” said SOC investment group executive director Dieter Waizenegger, who was one of the shareholders who filed the civil rights. proposal.

“Investors heard from Apple corporate and retail employees who bravely spoke out against unfair and harmful terms, even under threat of retaliation.”

Similar shareholder proposals calling for civil rights audits have passed over the past year at several other public companies, including CitiGroup.

While he didn’t say whether Apple intended to undergo a civil rights audit, Cook described gender and racial equity as “essential to the future of our business.”

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