At Amazon's annual shareholder meeting this morning, investors were given the opportunity to vote on a proposal that would have made the company analyze its human rights risks. For a second year in a row that the human rights idea has been proposed, Amazon's board of directors—including Jeff Bezos, of course—urged shareholders to vote against it and succeeded.
The proposal, representing 45 shareholders under the nonprofit SumofUs, would have forced the company to publish its human rights risks online by May of 2017. The SumofUs shareholders were particularly concerned with issues around Seattle's minimum wage and sick leave and safe time laws. Last year, Amazon security contractor Security Industry Specialists, Inc. (SIS) was investigated by Seattle's Office of Civil Rights (OCR) for allegedly punishing workers for taking legally protected sick leave. OCR and SIS settled the dispute in March of 2015 to bring SIS into compliance, and OCR still monitors the company to make sure it's paying affected employees back wages and correcting their records. According to SEIU6, two employees still haven't received what they're fully owed.
SumofUs also highlighted the potential risk of using conflict minerals in the production of the Amazon Fire phone and other hardware. "When it comes to disclosing minerals that go into the Fire that come from conflict in the Democratic Republic of the Congo, Amazon does much less due diligence than Apple, for example," Lisa Lindsley, SumofUs capital markets advisor, said. "As Amazon goes into manufacturing Fire and Echo, i think it's important to shareholders that that those products aren't being made with slave labor. Amazon is a very large, complex company and it doesn't seem like it's done as well as Apple and Google when looking at risks to its supply chain."
Amazon's board of directors told shareholders to vote against the human rights risk assessment, arguing that the company was already "strongly committed" to protecting human rights in its supply chain. "In addition, we joined the [Electronic Industry Citizenship Coalition], a nonprofit coalition of companies committed to supporting the rights and well-being of workers and communities worldwide affected by the global electronics supply chain, and benchmarked our Supplier Code of Conduct to the EICC Code as is required of all EICC members," the board wrote in Amazon's shareholder proxy statement.
But at least one tech CEO has criticized the EICC for being "absolutely toothless." Infiniera CEO Tom Fallon told the Atlantic in 2012 that he had never heard of any manufacturing facility failing to live up to the EICC's code of conduct.
The majority of shareholders voted down the SumofUs proposal this morning, but 23 percent supported it. That's a big uptick from last year's 5 percent support.
Lindsley, the SumofUs capital markets advisor, attributes much of the increased enthusiasm for the proposal to a recommendation from bigwig proxy advisory firm Institutional Shareholder Services (ISS). "Amazon could provide additional information regarding the policies the company has implemented to identify and assess human rights risks in its own operations and the relevant mechanisms it has implemented to ensure compliance with such policies," ISS wrote.
The New York Times exposé on Amazon's white-collar workplace culture could also have something to do with increased support for scrutinizing the company's human rights practices, but it's impossible to tell. Either way, SumofUs said that it's still committed to pushing Amazon to make a change.