Technology giant Apple Inc. believes the concept of “ideological diversity” is too vague and complex to be addressed when filling seats on its board of directors.
In fact, the company has gone to the Securities and Exchange Commission with a request to ignore a proposal from the National Center for Public Policy Research that seeks to put before Apple shareholders a rule to require the company to let shareholders know the ideological diversity of its board members.
According to a release from the center, its Free Enterprise Project drafted the proposal to restore some balance in Silicon Valley.
“We believe that boards that incorporate diverse perspectives can think more critically and oversee corporate managers more effectively,” the proposal said. “By providing a meaningful disclosure about potential Board members, shareholders will be better able to judge how well-suited individual board nominees are for the Company and whether their listed skills, experience and attributes are appropriate in light of the Company’s overall business strategy.
“True diversity comes from diversity of thought. There is ample evidence that the company and Silicon Valley generally — operates in ideological hegemony that eschews conservative people, thoughts, and values. This ideological echo chamber can result in groupthink that is the antithesis of diversity. This can be a major risk factor for shareholders.”
The center said Apple’s fight against the proposal proves the need for it.
“Apple is spending shareholder money hoping to avoid increasing diversity amongst its leadership. I wonder how the company’s investors feel about that,” said Justin Danhof, general counsel for the center and FEP director.
“Apple, like many businesses in Silicon Valley, suffers from liberal groupthink,” he said. “That’s concerning for long-term shareholders. FEP’s resolution provides a simple tool for Apple to alleviate that problem. That Apple is fighting us proves just how much it desires to remain a liberal enclave.”
Apple, in its filing with the SEC, claimed the problem is that the proposal isn’t clear.
“The proposal is impermissibly vague and indefinite because it fails to define the phrase ‘ideological perspective,'” the company wrote, saying the proposal did not outline how Apple would ascertain an individual’s ideological perspective.
Apple said the proposal’s use of the word “conservative” does not help because the word could be applied in many ways and perspectives.
It further argued that it provides sufficient information to shareholders about prospective board members.
Apple’s bottom line was that the proposal should be removed from those presented to shareholders because it would only confuse them.
Danhof rejected the tech giant’s argument, saying, “Apple seems to have a very dismissive view of its own investors.”
“Most middle-school students understand the concept of ideological diversity,” Danhof said. “I think Apple’s shareholders do as well. Groupthink is a major problem in a business setting, and Silicon Valley’s left-leaning hegemony is a growing risk to long-term investors. The SEC should reject Apple’s spurious claims and allow our proposal to proceed to the company’s fully competent investors for a vote.”
The SEC has not yet ruled on the company’s request to allow it to block the proposal from being seen by shareholders.
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