07 Mar 2019 FEP Proposal Dominates Apple Meeting, Press Coverage
While the Free Enterprise Project’s proposal for ideological diversity that was presented at last week’s Apple shareholder meeting may not have passed, it did generate a significant amount of attention from both investors and the media.
In a report by the Fox Business Network, correspondent Susan Li noted that FEP’s proposal dominated Apple’s meeting:
It was a 100-minute presentation – Q-and-A with [Apple CEO] Tim Cook as well. And there were a lot of proposals on the table. That includes approving the board at Apple and also executive compensation, and two shareholder proposals – one of them quite controversial.
It was part of this, ideological diversity, that a conservative activist group brought up to the table to Apple. And what they wanted to do was to have all the board members express their political leanings… It led into a very long discussion. In fact, it probably took up most of that 100 minutes of that presentation. And people were just asking Tim Cook, once again, saying, “Where do you stand in terms of hearing different views in Silicon Valley?” And Tim Cook says, “We are not for a polarized world, and we want to hear diversity.”
While Cook may have said he was for hearing about diversity, the company certainly wasn’t interested in abiding by FEP’s proposal. They fought it. Several other companies, by the way, have agreed to adopt the FEP proposal for ideological board diversity without a fight.
On Bloomberg, technology correspondent Mark Gurman repeated the term Fox Business used – “controversial” – and noted Apple’s opposition to it:
The biggest topic of discussion – whether that was from [Apple CEO Tim] Cook or different shareholders or proposals – was about diversity.
There was one very controversial proposal that Apple actually asked shareholders to vote against that was about disclosing the political or ideological leanings of their board members. And one shareholder proposal wanted them to come out with a chart that basically indicated the political leanings of… the board members.
And even though the proposal may have failed – it was opposed by the powerful Institutional Shareholder Services (ISS), which has hypocritically supported similar proposals advocating for diversity requirements rooted in race and gender – CNET Executive Editor Ian Sherr told CBS that FEP “really got the conversation going” at the Apple meeting:
There was this conversation that flared up about how the ideological makeup of tech companies and Silicon Valley – obviously being in California – was an issue for some shareholders, and something they were worried about.
Asked if this constituted a larger problem for Silicon Valley, Sherr responded:
It absolutely does.
I mean, one of the interesting things going on here is that you’ve seen – for the last couple of years – a real kind of increase in the conversation about women and racial diversity and how a lot of tech companies are primarily run by white men. And this backlash is happening that’s also very interesting that is coming from the conservative end. Not only driven by stuff like concern that Facebook and YouTube and Twitter might be reducing the voice of conservatives on their platforms, but also this larger conversation about: “Hey, the tech industry is in a blue state and a very liberal area. Maybe these people are making decisions that are having wide-ranging impacts and concerning people who don’t agree with them politically”…
It underscores how politics has really become a key issue in the tech industry.