As the time for new business at the Amazon shareholder meeting Thursday morning arrived, the audience grew restless. For those of us holding legal proxies or actual shares, a confrontation was coming on issues around political disclosure, climate change, ALEC funding, workplace conditions and Amazon's corporate taxes.
Two shareholder initiatives had qualified for the official ballot: Climate change transparency and accountability and transparency about corporate political contributions to candidates and organizations.
In addition to Jeffrey Bezos, Amazon's board of directors consists of venture capitalists and corporate CEOs, which is fairly typical for a public company. That group, for whatever reason, decided to recommend against political transparency and a climate change disclosure and transparency policy.
Amazon and Political Transparency
Bruce Herbert is founder and CEO of Newground Social Investment, and he was the author and filer of the political disclosure resolution, which he read aloud at the meeting. The resolution called for disclosure and review of all corporate political contributions, who they were paid to, identification of the Amazon official authorizing the disclosure with a statement of their purpose in authorizing it, and for all information on these expenditures to be posted on the Company website.
The board of directors declined to recommend its passage, just as they declined Calvert Social Investing's resolution to disclose Amazon's carbon footprint and plan for minimizing it.
When asked why they would decline these resolutions, Amazon officials would only say the company was considering climate change initiatives. The question of political disclosure was dodged completely. There was utter silence from the company and unfortunately, the shareholders did not follow up on that question as clearly as they should have.
Amazon and ALEC
While the more general political disclosure question went unanswered, there was pointed questioning about Amazon's involvement and funding of ALEC. ThinkProgress reported on Amazon's $10,000 contribution to ALEC's 2011 annual meeting, and it was definitely the subject of shareholder scrutiny. In response, Amazon declared that they review contributions to non-profit and trade associations on an annual basis and had opted not to renew their ALEC membership this year.
Does this mean they won't renew it in 2013? Great question. Twice they stated that they had elected not to fund ALEC, but both times it came with the words "this year," leaving the door open for re-entry when scrutiny isn't quite so sharp.
After they answered that question, they announced the results of the voting on these initiatives, at the very same time that ballots were being collected. In corporate-land, shareholders' votes are only as powerful as the number of shares they hold (and wealth associated with those shares), and so the political disclosure votes, before anyone counted the votes in the room, evidently, were 59 million for, 237 million against, with 44 million abstentions. The climate change resolution fared slightly better but still went down in flames with 69 million for, 227 million against, and 46.6 million abstentions.
Also, it's now on the record that Amazon and its directors and officers oppose having to disclose corporate political contributions to organizations and candidates. Based on their ALEC funding, I'm not optimistic about why they don't want to make these disclosures.
Lest you think the entire room was full of protesters holding proxies, I can testify that at least one man in the room was different. With one question left in the question and answer session, a middle-aged man rose and stepped to the aisle. In a strong voice, he chided the board and officers for their withdrawal from ALEC, saying he was "disappointed gave into political pressure and resigned from ALEC, an organization that has done so much good for people."
As you might imagine, that did not play well with the rest of the audience.
Amazon's workplace conditions
During the part of the meeting where Jeffrey Bezos gave his presentation, we heard that Amazon was going to spend $52 million to install air conditioning in some of their fulfillment centers. This presentation, given with a bit of a defensive edge, was the answer to criticism about Amazon's horrendous workplace conditions, first reported in 2011 after workers in Pennsylvania were subjected to incredibly hot and debilitating working conditions.
We even got to see video of the helicopter flying in the air conditioning units, and heard Bezos remind us not once, but twice, that it was very, very, very expensive to put air conditioning units into existing fulfillment centers. I wanted to remind Bezos that it's also very, very deadly for employees to work in closed warehouses with over 100-degree temperatures in the summer, and having ambulances stationed outside the workplace is hardly an adequate response.
Amazon and Corporate Taxes
Because it keeps expanding its business and making capital expenditures along the way, Amazon's corporate tax rate has been around 3.5%. As they were quick to point out, they have also hired 45,000 people since September, 2008 in the US. Of course, they also tried to pass off payroll taxes as their fair share, which didn't play well with many shareholders. One irate shareholder stood up and called them "sociopaths" for failing to fund the education structure which will (and has) benefitted them up to this point. It was one of the more tense moments, but company officials were ready for the question, and said that as expansion stabilizes, they will be paying more in corporate taxes.
Let me translate: As soon as they've availed themselves of all existing corporate tax loopholes, they'll go ahead and pay some more in taxes right after they've finished making opaque contributions to organizations that can work on their behalf to keep taxes low. It was an answer worthy of an auditor, and indeed, it was the corporate CPA that answered the question.
The many outsiders...
For every person who was seated in the 300-seat auditorium inside the Seattle Art Museum, there was one representing the 99 percent outside the Seattle Art Museum. At the end of the meeting inside, several people stood and mic-checked the board, calling on them to be compassionate, to consider their workers, to consider the environment, and to be honest about how shareholders' funds are spent with regard to political associations. As each stood to be heard, three police officers walked down and escorted them outside in a firm and not necessarily polite fashion.
It's almost de rigueur these days, you know. I imagine there are meetings of these directors at parties where they ask whether or not the cops have had to eject anyone from a shareholders' meeting. But stop for a minute and think about that. In a meeting where each person had to prove their legal right to be present in the room, they were forcibly ejected by police for...what? Disagreeing? Calling for a corporation to be a better citizen? Speaking their minds?
They had a right to speak. Each and every one of them. They had proven that by going through the rigorous review and security checks that got them in that room. Yet they were silenced by the police for simply speaking words those directors did not want to hear. Words their public relations department would have to spin later. Why is a company built on words and books afraid to hear words?
The truth is powerful and convicting. If one doesn't want to hear it, all they have to do is make sure they've got the police with them. Those insiders joined the outsiders and they all raised their voices loud enough to be heard by the waiting television and newspaper cameras outside. They made themselves heard from the inside of the auditorium to the foyer to the outside and hopefully to the outside world, as they chanted over and over...
We are the ninety-nine percent.
Indeed, we are. I am. You are. So we take the small victory of at least one more corporation backing away from ALEC for one year at least, and press on to the next.