Google insiders use outsized voting power to vote down popular proposal
According to final voting numbers for Alphabet’s 2022 annual general meeting, approximately 64.3 percent of independent shareholders voted in favor of a third-party racial equity audit analyzing the company’s impacts on Black, Indigenous, and People of Color (BIPOC) communities. However the proposal failed to earn an overall majority due to the outsized voting power of Alphabet founders Sergey Brin and Larry Page.
The proposal requested that Alphabet’s board commission an independent assessment of the company’s impacts on racial equity, in response to numerous reports alleging harm from Alphabet’s often ubiquitous technologies, products, and policies. YouTube has been routinely implicated in promoting white supremacist ideology and anti-Muslim propaganda. Research also shows that Google’s facial recognition technology is susceptible to bias, and the company has come under fire for retaliating against employees who point out discrimination.
Alphabet employs a multi-class shareholder structure that gives certain directors and insiders a stunning 10 votes per share, compared to independent investors who only receive 1 vote per share — and some independent shareholders receive no voting power at all. With these powerful insiders’ opposition, the race equity audit proposal earned only 22.4 percent of the weighted vote. After removing current Alphabet directors and officers, however, a sizable 64.3 percent majority of the remaining shareholders voted in support.
“This vote shows that Alphabet shareholders overwhelmingly understand the vital importance of assessing the company’s impacts on racial equity. Alphabet insiders, however, don’t care,” said Michael Connor, Executive Director of Open MIC, a nonprofit organization that worked with shareholders to develop the proposal. “It’s a travesty that a couple of powerful men can stand in the way of what independent shareholders know to be true: Alphabet cannot possibly live up to its values if the company continues to close its eyes to the rampant harms inflicted on BIPOC communities.”
“The majority vote in favor of the proposal by independent shareholders is a significant victory,” said Laura Campos, Director of Corporate and Political Accountability at the Nathan Cummings Foundation, the lead filer of the proposal. “Despite a deck that’s heavily stacked in its favor, Alphabet was sent a strong message by its outside investors, who believe the company’s significant impacts on BIPOC communities warrant an independent racial equity audit.”
Advocates have long argued that Alphabet’s weighted shareholder structure acts as a serious deterrent to corporate accountability. Last month, a coalition of thirteen civil society organizations led by Open MIC sent an open letter to Sergey Brin, Larry Page, and former Google CEO Eric Schmidt urging them to use their unmatched voting power to support the racial equity audit proposal.
In the letter, the coalition spelled out how “experience shows that an independent audit is a valuable tool for assessing the progress of ongoing equity efforts, not a hindrance to those initiatives. Rejecting this shareholder proposal positions Alphabet as falling behind its peers. As Class B shareholders, your support or abstention has the power to make or break this popular and necessary investor-led advocacy. We urge you to uphold Alphabet’s principles and ‘do the right thing’ by supporting proposal 9 for an independent racial equity audit.”
The coalition letter was signed by Access Now, Accountable Tech, ACRE, the Alphabet Workers Union, the American Friends Service Committee, the Center for Digital Democracy, Color of Change, Fight for the Future, Free Press, the Heartland Initiative, MediaJustice, Open MIC, and Ranking Digital Rights.
For more information:
Michael Connor
Executive Director, Open MIC
media@openmic.org
212-875-9381