Amazon faces slate of shareholder proposals
Amazon shareholders have been a remarkably tolerant bunch over the years, sitting idly by while the company plowed nearly all its revenues back into expanding the business, submitting few if any resolutions each year for the proxy ballot.
This year, that could change. A lot.
Amazon received more resolutions than any other company this year, according to a count by Alliance Advisors. Although a few were either withdrawn by their proponents or excluded with the permission of the Securities and Exchange Commission, shareholders still will vote on 12 measures at Amazon’s annual general meeting on Wednesday, on issues ranging from food waste to hate speech.
Nine of the resolutions were coordinated by the Interfaith Center on Corporate Responsibility, a coalition of about 300 institutional investors that press their portfolio companies to take action on human rights, gender and racial diversity, and the environment. The group decided to focus on Amazon after finding that many members had been frustrated over the years in attempting to engage the company through less confrontational means.
Other companies, the coalition said in a letter to Amazon last fall, usually at least take their concerns seriously. By contrast, Amazon held short phone calls, “ultimately leading to unproductive outcomes.”
“What can you get out of a 30-minute conversation? There was no give and take,” said Nadira Narine, senior program director with ICCR. She characterized Amazon’s attitude as, “‘We’re doing XYZ, we think that’s enough, let’s move on.'”
The large number of resolutions at Amazon’s meeting comes at a time when social and environmental activists are increasingly using the levers of corporate governance to push their agendas. They believe that’s especially important after the White House in recent years has pulled back on regulations that might have accomplished similar goals on issues such as climate change or data privacy.
Amazon’s facial recognition technology, Rekognition, is the subject of two resolutions — one calling for a study of the effects of its use by government agencies, and another that goes further, requesting a moratorium on sales to governments until potential harms are mitigated. The latter was organized by a coalition of Catholic groups after the news broke last winter that Amazon had pitched the software to Immigration and Customs Enforcement.
“There are just so many risks with this technology in the hands of governments, perpetuating increased surveillance as a whole, reinforcing bias that exists in our criminal justice system in the US,” said Mary Beth Gallagher, executive director of the Tri-State Coalition for Responsible Investment. “We don’t have the proper guardrails.”
Amazon asked the SEC for permission to omit both of those resolutions, which the SEC denied, on the grounds that they were issues of legitimate investor concern. As usual, Amazon’s board opposed every single resolution on the ballot, saying that it’s already taking action to address many of the concerns they raise.
“We generally oppose proposals requesting specific reports, policies, or initiatives for not reflecting the unique and evolving nature of our operations,” the company’s statement reads.
Amazon has been particularly defensive about its actions around environmental sustainability, with a website that touts its efforts to reduce packaging waste and operate on renewable energy. But this year, it’s facing a new type of critic: Its own employees, who are also shareholders, given that compensation at Amazon is heavily weighted towards stock.
Last fall, 28 current and former workers at Amazon’s Seattle headquarters filed a shareholder resolution asking for the company to create a public report for how it plans to address climate change. In April, the group laid out a list of demands for further action, such as achieving zero carbon emissions and ending contracts with oil and gas companies. That public letter has now garnered 7,672 signatures of support from verified Amazon staff — a rare public display of dissent.
For Maren Costa, a principal user experience designer who’s worked at Amazon for 15 years, backing the shareholder proposal is in line with the one of the company’s 14 “leadership principles”: ownership.
“I can’t think of a better stage to play out ownership than climate change,” Costa says. “We’re ready to go to work to help the company lead. The only thing that’s missing is Jeff Bezos and the board.”
The employees’ resolution stands a real chance of winning substantial support, given a new willingness on the part of extremely large asset managers like BlackRock and Vanguard — Amazon’s second and third-largest shareholders behind chief executive officer Jeff Bezos — to vote for climate change measures. The resolution also won favorable recommendations from the nation’s two largest proxy advisory firms, ISS and Glass Lewis, which have significant pull among mid-sized investors.
Correction: The original version of this story incorrectly described the order of events around the shareholder resolution started by workers at Amazon’s headquarters.