LONDON: At Amazon.com Inc.’s (NASDAQ: AMZN) annual shareholder meeting on Wednesday, 14 investor resolutions will challenge the company’s policies. This is a record for the retail and cloud computing giant, as socially conscious investors look into how the company treats its employees.
The rise in the number of resolutions shows that investing based on environmental, social, and corporate governance (ESG) is becoming more popular, which is making more shareholders want corporations to be more accountable.
It also shows how changes made by securities regulators appointed by U.S. President Joe Biden have made it easier for investors to file proposals and harder for companies to convince regulators that these resolutions shouldn’t go to a vote of shareholders.
According to research firm Insightia, Alphabet (NASDAQ:GOOGL) Inc will set a new record for such resolutions at an S&P 500 company next week when it faces 17 on June 1.This is the most since it began keeping track of them in detail in 2014.
About ten of the shareholder resolutions that Amazon investors will vote on have to do with worker rights and other “social” issues, such as asking the company to report on worker health and safety or how its warehouse workers are treated. The others ask for things like a review of Amazon’s use of plastic or changes to how the company chooses its board members.
Amazon has asked its investors to vote against all 14 resolutions. In its proxy statement, it says that it has often already taken steps to address the concerns behind a resolution. Even though the resolutions don’t have to be followed, companies often do something if 30–40% of the people who vote for them agree.
Institutional Shareholder Services, a top proxy advisor, has told investors to vote for eight of the proposals. Glass Lewis has told investors to vote for seven of the proposals.
Royal London Asset Management Ltd. is the largest mutual life, pension, and investment company in Britain. Its head of responsible investment, Ashley Hamilton Claxton, told Reuters that the company plans to vote in favor of at least six of the shareholder resolutions at the Amazon meeting.
Legal & General Investment Management, the biggest asset manager in Britain, and Schroders (LON: SDR) Plc, another British asset manager, have both said they will support at least some of the investor resolutions at Amazon’s shareholder meeting.
ESG-focused funds often own shares of Amazon. Jefferies Financial Group Inc. says that about 32% of the funds in the European Union that are meant to help the environment or promote social justice are invested in Amazon. Only Microsoft Corp (NASDAQ: MSFT) is more widely held, with 39% of these funds holding it.
Brandon Rees, a deputy director for the AFL-CIO, the largest labor organization in the U.S., said he hoped that ESG funds that hold Amazon would support more labor-focused resolutions.
“I think that worker rights and workers’ rights have been buried in the ‘S’ of ESG,” Rees said.
