Apple gets ‘striking warning’ from shareholders over China app takedowns

An Apple shareholder proposal that was critical of the company’s takedowns of virtual private network (VPN) apps in China received a notably high level of support at Apple’s annual meeting of shareholders on Wednesday; characterized by one expert as a “striking warning.”

Apple shareholders meeting. Image: Apple logoStephen Nellis and Ross Kerber for Reuters:

The proposal, which called for Apple to report whether it has “publicly committed to respect freedom of expression as a human right,” was defeated, but 40.6% of votes cast supported the measure, according to company figures… Wednesday’s vote stood in contrast to previous years when critics made little headway with big investors on the issue.

“A total this high is a striking warning — and it must have come from big institutional investors, not just retail shareholders — that Apple’s human rights policy in China has become a material risk for the company’s reputation,” said Stephen Davis, a senior fellow at Harvard Law School’s Program on Corporate Governance. “Apple will be under great pressure to respond rather than ignore this vote,” Davis said.

An Apple spokesman declined to comment on the results. Apple had opposed the proposal, saying it already provides extensive information about when it takes down apps at the request of governments around the world and that it follows the laws in countries where it operates.

MacDailyNews Take: Good. We hope to see Apple provide more transparency regarding app takedowns requested by China and other countries whenever they occur.

In additional votes at yesterday’s meeting, shareholders approved Apple’s existing board of directors, executive pay, and the retention of Ernst & Young as its accounting firm. Shareholders defeated a “proxy access” proposal to allow shareholders to nominate more than one director to Apple’s board, (68.9% against, 31.1% for) and also voted down a measure to tie executive compensation to environmental sustainability metrics (87.9% against, 12.1% for). Apple had opposed both proposals.


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