What you need to know
- Apple's shareholders want to know more about the company's use of NDAs and concealment clauses.
- They have proposed a measure to be voted on at the next shareholders' meeting.
- The SEC has denied Apple's bid to stop the proposal.
The SEC has tossed out an attempt by Apple to stop a vote on a proposal from its shareholders that would see it tell investors about its use of non-disclosure agreements and concealments clauses.
The U.S. Securities and Exchange Commission has denied Apple Inc's (AAPL.O) bid to exclude a shareholder proposal that would require the company to inform investors about its use of non-disclosure agreements and other concealment clauses, according to a document viewed by Reuters.
A group of activists and Apple employees filed a proposed shareholder resolution in September of this year, as iMore first reported:
A group of activists and Apple employees have prepared a shareholder resolution, asking that the company investigate the risks posed to employees by its non-disclosure agreements when they try to speak out about their working conditions.
The proposal states:
Shareholders of Apple Inc. ("Apple") ask that the Board of Directors prepare a public report assessing the potential risks to the company associated with its use of concealment clauses in the context of harassment, discrimination and other unlawful acts. The report should be prepared at reasonable cost and omit proprietary and personal information.
Apple reportedly told the SEC it did not want the proposal to be voted on because "the company's policy is not to use such clauses." The SEC told Apple it had not "substantially implemented the proposal", and two leading #AppleToo whistleblowers, Ashley Gjovik and Cher Scarlett have both reportedly filed SEC whistleblower complaints with the SEC claiming Apple made false statements to the agency.
The filing group said that such clauses could be used to limit employees' ability to discuss unlawful acts in the workplace including harassment and discrimination. The group did however note that Apple was wise to use such policies to protect its intellectual property, trade secrets, and information about upcoming devices.
The proposal was sparked by the #AppleToo movement, a growing outcry from employees who claim they've been subjected to harassment, racial discrimination, and more while working at Apple.
As Reuters notes companies routinely file such requests to the SEC regarding shareholder proposals, around half of which are granted.