Apple seeks permission from SEC to exclude proposal tying executive diversity metrics to C...

in General Discussion edited October 2017
Apple earlier this month asked the Securities and Exchange Commission to authorize the exclusion of a shareholder proposal that would tie the company's diversity efforts to CEO performance, an action that could negatively impact Tim Cook's compensation.

Penned by Boston investment management firm Zevin Asset Management in September, the proposal speaks to the performance, or lack thereof, of Apple's diversity program, particularly as it applies to senior management positions, reports Silicon Beat.

In its filing, Zevin asks Apple to integrate "sustainability metrics, including metrics regarding diversity among senior executives, into the performance measures of the CEO under the Company's compensation incentive plans." The proposal also includes figures from studies suggesting racial diversity in the workplace is directly related to financial success.

Zevin, along with music executive Tony Maldonado, have for the past three years attempted to persuade Apple to provide some form accountability for what the group views as an apparent lack of diversity within its executive ranks. The investment firm lodged a nearly identical suggestion in 2015 and saw a similar measure go to vote last year.

Shareholders weighed in on the subject in March, with the proposal receiving less than 6 percent of the vote. Under SEC guidelines, the lack of support gives Apple grounds to block inclusion of similar proposals in proxy votes for three years.

As such, Apple VP of Corporate Law Gene Levoff in a letter this month asked the SEC for permission to exclude the proposal from the company's upcoming shareholder meeting.

For its part, Apple argues current efforts to diversify its workforce are sufficient, and the company has advised shareholders to vote against narrowly worded proposals like those lofted by Zevin. In January, the company said its "holistic view of inclusion and diversity" generates opportunity for underrepresented minorities within the tech community.

Apple's regular diversity reports show that creating a diverse and inclusive workplace is slow going. According to the latest statistics, 54 percent of new hires in the U.S. are ethnic minorities, but 56 percent of current workers are white and 68 percent are male. Apple's Equal Employment Opportunity report for 2016 (PDF download), filed in July, shows 73 of the company's 107 executives were white men. Another two men identified as Hispanic or latino, while the report noted three black or African American members, one of which was a woman.

As part of efforts to accelerate the process, Apple earlier this year appointed human resources veteran Denise Young Smith as the company's first VP of Inclusion and Diversity.

The SEC is expected to decide on Apple's request to exclude before the company holds its next shareholders conference next year.

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