Supporters of this shareholder proposal request that Apple include in its Transparency Reports, or explain why it cannot disclose:
The substantive content of government requests, by country, including which government agencies made requests; number of apps removed by category such as “encrypted communications,” VPN, etc.; and external legal or policy basis as well as internal company criteria on which the apps were removed;
Any indicia of the extent of impact on residents of those countries, such as the number of prior downloads of the app and whether existing usage of the app was eliminated;
Any efforts by the company to mitigate the harmful effect on freedom of expression and access to information posed by the categories of removals.
Although Apple states that its decision to withhold such information stems from privacy concerns, this request – which is supported by transparency advocate Open MIC – explicitly states that a revision to Apple’s Transparency Reports should exclude proprietary or legally privileged information.
Why It's Important
This proposal has been filed in response to news reports that Apple has removed apps from its App Store, sometimes proactively, to avoid harming relationships with authoritarian governments. This includes complying with requests from Russia and China, two regimes that stand accused of war crimes and genocide, respectively.
“The current tragic situation in Ukraine highlights the potential risks and dangers of corporate complicity with authoritarian governments,” said Michael Connor, Executive Director of Open MIC. “The shareholder vote sends a strong message to Apple’s board of directors: Apple should not–and cannot–censor iPhone apps that are often tools for pro-democracy organizing or freedom of information and communication.”
In December 2020, 154 human rights organizations wrote to CEO Tim Cook regarding Apple’s complicity with the Chinese government’s human rights atrocities, noting that “[e]ven though...app removals gravely affect freedom of expression and access to information, Apple’s Transparency Report currently does not disclose such actions beyond a number.”
The New York Times reported in May 2021: “... Apple has constructed a bureaucracy that has become a powerful tool in China’s vast censorship operation. It proactively censors its Chinese App Store, relying on software and employees to flag and block apps that Apple managers worry could run afoul of Chinese officials.” Since 2017, the Times said, roughly 55,000 active apps have disappeared from Apple’s Chinese App Store, including “tools for organizing pro-democracy protests and skirting internet restrictions.” Most of those apps have remained available in other countries, the Times said.
In April 2022, CEO Tim Cook gave a speech in Washington, D.C. in which he described Apple’s commitment to operating its App Store in a manner that promotes privacy. A week later, Commissioner Brendan Carr of the U.S. Federal Communications Commission wrote a public letter addressing Cook’s speech, stating that: “at the very same time that [Cook was] speaking in D.C. about [Apple’s] App Store policies promoting privacy and human rights, [Apple] was continuing its well documented campaign in Beijing of aggressively censoring apps at the behest of the Communist Party of China.” Carr went on to state that “[i]f you look at the behavior of the Chinese government, you don’t see any resistance from Apple – no history of standing up for the principles that Apple claims to be so attached to."
Apple’s transparency report for the first half of 2020 disclosed that it complied with all 46 requests from the Chinese government to remove 152 apps from the App Store. The report did not explain which apps were removed or for what reason.
Apple’s transparency reporting takes a “quantitative approach” that offers “little context for the app removal requests from the Chinese government or explanation of the risks that may be involved,” according to Institutional Shareholder Services.
The 2020 Ranking Digital Rights Corporate Accountability Index found “Apple lacked transparency about its process for removing apps from the App Store for violations to iOS rules.”
Shareholders are deeply concerned about a material failure in Apple’s transparency reporting that seemingly highlights a contradiction between Apple’s human rights policy and its actions regarding China and its occupied territories, which represent almost a third of Apple’s customer base. This poses significant legal, reputational, and financial risk to Apple and its shareholders.
The Most Recent AGM
In 2021, this proposal calling for a revision to Apple's Transparency Reports received 3,042,933,417 votes from shareholders, which translates to 31.73% voter support, a strong showing for a proposal filed for the first time. With the help of activist investors like you, we can continue to push for Apple to make this positive change in favor of human rights and freedom of expression.
Apple's 2023 annual general meeting (AGM) was held virtually on March 10, 2023 at 9.00 A.M Pacific Time (5.00 P.M. GMT). You can read the company's 2023 proxy statement to see what proposals eligible shareholders were able to vote on.
Proposal successfully withdrawn for agreement with the Company in 2023.
The record date pertains to the date by which investors must hold their shares in a company in order to participate in the company’s AGM. In order to have been eligible to vote at Apple's 2023 AGM, you must have been a shareholder of record at the close of business on January 9, 2023.
Voting at the AGM
If you hold Apple stock before the next AGM record date, you will be eligible to vote at the next Apple AGM and receive an email from us closer to the deadline about how to do so.
What is shareholder activism?
Shareholder activism is when shareholders use their influence as owners of a company to effectuate change within the organisation.
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