Amazon Investors Reject Employee-Led Facial Recognition Limits Proposal

But the company's historic behavior suggests it ain't over.  JL

Karen Weise reports in the New York Times:

No shareholder resolution at Amazon has ever passed. But they have pushed the company to change. Last year, Amazon initially opposed a shareholder resolution to intentionally consider diverse candidates, which at the time had only white directors. But after public opposition, it reversed course and formally adopted the policy. The shareholders later dropped their proposal, and Amazon has since added two women of color to its board.

Amazon said on Wednesday that its shareholders had voted down proposals that would have pushed the company to reconsider its societal impact in two key areas: facial recognition and climate change.

The proposals asked Amazon to develop a more comprehensive approach to reducing its carbon footprint and put the brakes on how the company sells surveillance technologies to governments.

The company’s board had opposed the changes. But the initiatives received support from the two most prominent shareholder advisory firms, which help large, long-term investors decide how to vote.

Amazon did not disclose the vote total on Wednesday, but said it would by the end of the week.

Activist investors typically bring shareholder proposals. But the climate change initiative had an interesting twist: Amazon employees, paid in part with stock, pushed the plan. The move introduced a new tactic in the growing activism among tech employees. More than 7,500 workers signed a letter supporting the climate change proposal, disclosing their names publicly.

The initiative would have pushed the company to develop a public report describing how Amazon plans for climate-related disruptions such as extreme weather and how the company will reduce its dependence on fossil fuels, which power its vast fulfillment and delivery operations as well as its data centers.

Glass Lewis, a shareholder advisory firm, wrote that Amazon disclosed less information about sustainability than its peers, and it recommended investors support the proposal because it would let employees and shareholders better understand how the company addressed climate change.

Amazon and its board have argued the company is already working to mitigate its climate impact through various measures, such as plans to disclose its carbon footprint later this year and a new initiative called Shipment Zero, which aims to have 50 percent of shipments net-zero carbon by 2030.

Activist investors submitted two proposals to limit the company’s sale of its facial recognition tool, Amazon Rekognition, arguing the spread of such surveillance technologies could hurt civil rights, and thus the company’s reputation.

One proposal asked the board to commission “an independent study” looking at several issues, such as whether customers could use Rekognition to “unfairly or disproportionately target or surveil people of color, immigrants and activists in the United States” or whether it sold to authoritarian or repressive governments abroad. The other asked the company to stop selling Rekognition to government customers unless the board determined the technology did not help perpetrate civil and human rights abuses.

Amazon “may be lagging its peers” because it has “not developed rules for bidding on government contracts, has not formed an Artificial Intelligence ethics committee and has not announced partnerships with civil liberties organizations,” said Institutional Shareholder Services, the other top advisory firm.

The company and its board have said they are not aware of any time that law enforcement agencies have used Amazon Rekognition to infringe on civil liberties. The board said the report would be a waste of money on “hypothetical and speculative concerns.” And it said the outright ban did not make sense because “we do not believe that the potential for customers to misuse results generated by Amazon Rekognition should prevent us from making that technology available to our customers.”

The bar for shareholder proposals to pass is high. Mr. Bezos controls 16 percent of the company’s shares, and a proposal must get half of the votes. Investors who abstain are counted as supporting the board’s recommendation.

No shareholder resolution at Amazon has ever passed, according to the financial data firm FactSet.

But they have pushed the company to change. Last year, Amazon initially opposed a shareholder resolution to intentionally consider diverse candidates, saying it had already looked for diverse leaders for its board, which at the time had only white directors. But after public opposition, it reversed course and formally adopted the policy. The shareholders later dropped their proposal, and Amazon has since added two women of color to its board.