Amazon shareholders will question the company over executive pay, tax transparency, working conditions and union membership as its chief executive, Andy Jassy, faces the first annual meeting at the helm of the e-commerce and cloud computing giant.
The $1 trillion tech company opposes 15 shareholder proposals, the most it has faced since 2010, according to regulatory filings. At that time, no proposal garnered 50% support, and voting traditionally followed the board’s recommendations. Founder and former CEO Jeff Bezos himself controls 12.7% of the overall vote.
Still, strong opposition could force the company to modify its policies and practices at a time when big tech companies are increasingly challenged by investors who want them to be more responsive to public controversy.
Wednesday’s annual meeting also represents a test of leadership for Jassy, who took over from Bezos last July, as he tries to manage the high-profile challenges facing the company.
That pressure has grown since the start of the year, as Amazon’s share price has dropped nearly 40% amid widespread tech sell-offs, but also due to rising costs from Amazon’s retail arm.
Other tech giants have been vulnerable to shareholder requests in recent years. In March, Apple shareholders backed a “civil rights audit” and more than a third of investors rebelled against compensation for chief executive Tim Cook. In November 2021, Microsoft shareholders overwhelmingly supported a protest vote for the company to reveal more about how it handles reports of sexual harassment.
Previous unsuccessful but strong votes by Amazon shareholders prompted the company to publish an environmental impact report, which it did for the first time in 2019. More recently, a report on safety at the company’s warehouses confirmed that its rates of personal injury were higher than their peers in the industry.
A proposed racial equality audit this year was withdrawn after Amazon hired former US Attorney General Loretta Lynch to carry out the report. New York State accounting auditor Thomas DiNapoli, who introduced the proposal, said he was pleased that Lynch’s review addressed his concerns.
The audit was proposed last year and garnered 44.18% support – the highest level given to any shareholder proposal that year.
This year, Amazon Workers Union leader Chris Smalls will ask the company to issue a report detailing its policies on “freedom of association” and collective bargaining. Smalls was the architect of the first successful union campaign at an Amazon unit in the US.
The proposal, along with another requesting an independent audit of working conditions at the company’s facilities, was supported by influential investment advisory groups Institutional Shareholder Services (ISS) and Glass Lewis. Norwegian pension fund Norges Bank said it would vote in favor of both proposals.
Norges Bank gave similar support to a call for more transparent tax reporting. In addition, Glass Lewis and Morningstar Sustainalytics told investors to vote on the resolution that would significantly overhaul the tech giant’s reporting on where and how much it pays in taxes around the world.
Katie Hepworth, head of taxation at consulting firm Pirc, which supports the resolution, said more than 10% of shareholders passing the vote would be “significant” and could lead to Amazon accepting the proposal. “It’s about investors sending a message about what’s important to them,” she said.
Asset managers including Nordea and Royal London have already backed the shareholder resolution on taxes. Amazon said the required disclosures would mean revealing confidential information to competitors.
Several groups are also contesting the advice on the company’s leadership issues, including Jassy’s $214 million annual salary package. The ISS said that the compensation of the new boss and other senior executives lacks “objective performance criteria, exacerbating a misalignment between compensation and performance.”
Translated by Luiz Roberto M. Gonçalves
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