FOR IMMEDIATE RELEASE
27% of Shareholders Voice Dissent at Tesla’s Policy that Enables Discrimination
September 24th, 2020
Media Contact: Meredith Benton at email@example.com or on 978.304.2234
This week at Tesla’s Annual General Meeting, 27% of shareholders voted for Nia Impact Capital’s resolution asking the company to research its use of forced arbitration agreements.
The shareholder resolution asked the Board (to) study the impact of the use of mandatory arbitration on Tesla’s employees and workplace culture, evaluating the impact of Tesla’s use of arbitration on harassment and discrimination in its workplace and on employees’ ability to seek redress.
Requiring employees use arbitration has been linked to enabling discrimination and harassment at companies. Facebook Inc., Microsoft Corp, and Uber Technologies Inc. no longer require arbitration’s use when sexual harassment is claimed.
Although Tesla’s code of conduct bans harassment and discrimination in the workplace, Tesla has faced multiple allegations of racial discrimination and sexual harassment at its factories.
At Tesla’s factories, stories have been told which include: A section of the Fremont factory that women called the “predator zone,” violent race-based threats experienced by Black employees, and swastikas and racial slurs in the bathrooms.
Tesla is an outlier in the level of disclosure and transparency it provides to investors on its workplace practices. Unlike many of its automotive peers, including Ford, General Motors, and FCA, Tesla does not release workforce composition data and its reporting lacks comparable levels of detail on programs to ensure diversity and inclusion within its workplace.
Dr. Kristin Hull, Founder and CEO of Nia Impact Capital, said: “The proposal speaks to the widespread experience of discrimination in the workplace by Black, Latinx and female employees, despite this discrimination being unlawful under the Civil Rights Act of 1964. Companies that allow bias, discrimination and harassment in their workplaces are at risk for unnecessary legal, brand, financial, and human capital issues.”
Tesla had recommended that shareholders vote against the proposal. Named Executive Officers and Directors hold 42,878,103 shares of Tesla stock. If these shares are excluded from the “Against” vote, the resolution received support from 44% of votes cast. (For:29,705,849, Against:81,039,674). It was supported by leading proxy advisory firms Institutional Shareholder Services Inc. and Glass Lewis.
Meredith Benton, Founder of Whistle Stop Capital, a consultancy supporting Nia Impact Capital in its conversations with Tesla said “The valuation of Tesla’s shares does not come from Elon Musk’s decision to invest in himself. His wealth depends on the trust and confidence of the other shareholders. Those shareholders have made a clear request that the Board provide more oversight of Tesla’s corporate culture and its use of mandatory arbitration when it comes to sexual harassment and racial discrimination.