A coalition of investors, which had requested that Verizon Communications Inc. (NYSE: VZ) publish regular reports on government and law enforcement requests for confidential customer data, today commended the company for publishing its first report and made recommendations for improving future reports.
Apple Shareholders File Proposal on Privacy and Data Security
For Immediate Release
September 24, 2012
Investors in Apple Inc. have filed a shareholder proposal asking the company to publish a report explaining how its Board of Directors is overseeing privacy and data security risks.
The proposal, which is intended for consideration by Apple shareholders at the company’s 2013 annual meeting, was co-filed by clients of socially responsible investment firms Trillium Asset Management LLC and Zevin Asset Management LLC.
“Unauthorized collection, disclosure, or misuse of personal information can cause great harm to individuals and society - including discrimination, identity theft, financial loss, loss of business or employment opportunities, humiliation, reputational damage, questionable government surveillance or physical harm,” the proposal states.
The shareholders assert that “Apple’s Board has a fiduciary and social responsibility to protect company assets which include the personal information of a variety of stakeholders.”
According to the proposal, Apple has recently confronted a number of cyber security and privacy controversies - drawing the attention of Congress and outside groups. The controversies include unauthorized access to iPhone users’ address books; Unique Device ID related litigation and the release of one million UDIDs; and security concerns related to iCloud.
The shareholder proposal notes a recent study by the Ponemon Institute which found data breaches could negatively impact brand value and reputation by as much as 17 percent to 31 percent, with the average loss in brand value ranging from $184 million to more than $330 million.
In seeking a report, the shareholders state that “investors need to understand more fully how the Board is overseeing” concerns about privacy and data security. The proposal references a recent study by Carnegie Mellon University’s CyLab which surveyed corporate governance and enterprise security practices at a number of leading global companies.
The shareholder proposal at Apple was developed in consultation with the Open Media and Information Companies Initiative – or Open MIC – a non-profit organization that works with shareholders and companies to foster more open and responsible media policies and practices. A copy of the Apple proposal is available here.
Michael Connor, Executive Director of Open MIC, said the Apple proposal followed months of research into privacy and data security risks at major U.S. companies, with a particular emphasis on corporate governance and the responsibilities of boards of directors. “We expect similar shareholder proposals on this critical issue will be filed at other firms in the coming months,” Connor said.
For more information:
The Open MIC Blog
In a victory for shareholders concerned about the role of telecommunications companies in government surveillance programs, Verizon Communications announced that it will begin to publish regular reports on the number of government requests it receives for customer data.
The move came nearly a month after institutional investors filed proposals with Verizon and AT&T demanding that the companies issue semiannual reports on government information requests.
Citing intense global concern over the impact of disclosures regarding surveillance programs directed by the U.S. government agencies, investors in AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ) have filed shareholder proposals calling on the companies to publish semi-annual reports detailing how often they have shared information with U.S. or foreign governments and what type of customer information has been shared.
The prime sponsor of the AT&T proposal is the $160.7 billion New York State Common Retirement Fund, which manages assets on behalf of more than one million State employees and retirees. Trillium Asset Management LLC, a Boston-based investment management firm, is the lead proponent of the Verizon. Other investment firms and organizations – including the American Civil Liberties Union of Northern California – co-filed at one or both of the companies.