Tech giants Apple Inc. is currently pushing back on a shareholder proposal relating to climate issues and human rights concerns. This move worries several activists who believe the company could restrict investor rights.
An attorney for Apple in a series of letter to the U.S. Securities and Exchange Commission last month stated that not less than proposals from shareholders are related to ordinary business and can be held off the proxy the company is planning to publish next year, before its annual meeting.
The attorney Gene Levoff quote some guidance issued by the SEC on November 1st which stated that the boards of a company are in the best position to decide if a resolution has significant policy issues before it can be put to the vote.
Even though some companies seek permission to skip the shareholder proposals, Apple’s use of the SEC guidance indicates that it could be used to ignore the proposals by claiming that the boards review those areas. This was according to Sanford Lewis, a Massachusetts attorney who is representing the shareholders of the company that filed two of the resolutions.
Lewis added that if SEC is to take Apple’s side, then “this would be an incredibly dangerous precedent that would essentially say a great many proposals could be omitted.”
A spokesman for Apple declined to comment further beyond the letters it sent to SEC. When contacted, a spokeswoman for SEC declined to comment on the issue. Officials of the regulatory body stated that the new guidelines were put in place to improve the resolution process.
Most of the time viewed as distractions; the shareholder measures are now more significant as they get the backing of asset managers especially in areas such as climate change or board diversity.
According to the letter Apple sent to it, it quoted its new guidance and other reasons for seeking to remove the shareholder measures from its proxy. Some of these reasons include calls from some quarters for Apple to take steps in putting together human rights committee that will tackle issues such as censorship, and for the company to report on its ability or otherwise to reduce greenhouse gas emissions.