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Shareholders of Apple Inc. are calling on the company to “adopt an accelerated recruitment policy” to increase diversity of its senior management and board of directors. In a proposal intended to be voted on at Apple’s 2017 annual meeting, the investors say the company’s senior management and board “presently fail to adequately represent diversity and inclusion (particularly Hispanic, African American, Native American and other people of color).”
The shareholder proposal notes that Apple has said: “Diversity is critical to innovation and it is essential to Apple’s future.” Yet, according to Apple’s 2016 diversity report, the company’s “leadership” is only 3% Black, 7% Hispanic and 1% multiracial.
Apple, the proposal says, is in an “advantageous position to be a leader in promoting diversity in senior management and its board of directors, based on its size, breadth and position as one of the largest companies in the world.”
The proposal notes research by McKinsey & Company which found companies with highly diverse executive teams had higher returns on equity and earnings performance than those with low diversity.
Citing a “persistent and pervasive” underrepresentation of minorities and women in senior positions in the tech industry generally, the proposal also notes recent data which shows that “[t]op universities turn out black and Hispanic computer science and computer engineering graduates at twice the rate that leading technology companies hire them.”
The shareholder proposal was filed by Tony Maldonado, a London-based music industry executive, and co-filed by Zevin Asset Management, a Boston-based sustainable investment firm. Mr. Maldonado filed a similar shareholder proposal at Apple last year.
“Evidence shows that companies with diverse leadership perform better financially, which is why Apple shareholders deserve a plan to increase senior management and board diversity that can be measured and examined,” Mr. Maldonado said. “Apple operates in a complex, global business environment where metrics matter – instead of resisting this proposal, the company should embrace it.”
Sonia Kowal, President of Zevin Asset Management, said: “Apple’s big marketing events this year featured more women and employees of color on stage. But investors won’t be satisfied with a diversity showcase – not when top decision-makers are still overwhelmingly white and male. We need a credible plan to integrate the board and C-Suite, and Apple doesn’t have it yet.”
"Apple says it believes in diversity so that it can ‘build products that are universal.’ But without people of color in decision-making roles, Apple is instead creating a world where its products reflect the needs of only a narrow sliver of the universe,” said Michael Connor, Executive Director of Open MIC, a non-profit organization that works with investors in the media and tech industries. “It's time for Apple to put into practice its belief and to build a company that is as diverse as the needs of people who rely on its technology.”
For more information:
Associate Director of Socially Responsible Investing
Zevin Asset Management