appleresolution

I had to read it twice to make sure I got things right. Apple is formally opposing a shareholder resolution to increase the diversity of its senior management and board of directors.

This isn’t news just for diversity nerds. It’s is a big deal for Apple customers and anyone affected by the tech industry or corporate America. In other words, everyone.

Let me break it down.

One of Apple’s Dominican shareholders, a Mr. Antonio Avian Maldonado II., submitted a measure to require more diversity from underrepresented ethnic groups (Hispanic, African-American, and Native American) in high level positions. Specifically, he proposes an “accelerated recruitment policy.”  [For the non-financially savvy like myself: In publicly traded companies, stock owners (or shareholders) have the option to propose something called a Shareholder Resolution. It acts as a non-binding recommendation to the board of directors, but is a powerful way to advocate for changes in board policy.]

You figure this would be a no-brainer. Since the company released its diversity numbers in 2014, it’s constantly pledged a deep commitment to increasing the representation of women and people of color in the workforce. Apple’s website features beautiful language on the benefits and significance of diversity like, “This means fostering diversity not just at Apple but throughout our entire ecosystem, from the customers we welcome in our stores to the suppliers and developers we work with.”

Apple’s formal response (start on page 60) to the Mr. Maldonado’s request, however, sings a different tune. After listing off the company’s diversity initiatives, it reads “We believe the proposal is unduly burdensome and not necessary”.

Apple, let me make sure I fully understand. Inclusion is important throughout your entire ecosystem, but diversifying decision-makers is too hard and unimportant?

My frustration doesn’t come just from this weak excuse. It comes from Apple’s refusal to put action to words. The tech giant has previously acknowledged its diversity shortcomings, pledged a commitment to change, and constantly gets feedback from advocates. With the exception of its employee associations, Apple’s diversity initiatives are largely external and only affect peripheral change. (Page 61 of its response lists scholarship programming, donating equipment to classrooms, sponsoring events, and internal associations for employees as evidence of its commitment).

Apple desperately needs to institute policies that bring diversity into its core business operations. Diversifying high-level positions is the most effective strategy to get there. And unfortunately for Apple, it’s headed in the wrong direction. Bloomberg’s chart below shows that black and Latino execs actually decreased from 2014 to 2015. As of today, people of color make up just two of Apple’s six board members and only one of its eighteen executives.applediversity

I can’t help but feel that Apple is giving lip service to placate those really fighting for a boardroom that looks more like America. It certainly wouldn’t be the first. Since 2000, 57 diversity resolutions have been presented to publicly traded companies. No company ever approved such a resolution, and I’m assuming Apple will follow suit. In fact, the company isn’t even required to bring the matter to a vote at the 2016 annual meeting, yet to be scheduled.

It should go without saying, but I’ll do it anyway. Apple, you need to diversify your board. You need to respect the input of your shareholders and bring this resolution to a vote. You need to approve it. Really.