Apple CEO Tim Cook will face a proposal at the May 4 annual meeting sponsored by shareholders who worry that the company kowtows before China's government by removing apps upon its demand.
The New York Times reported that “Apple has constructed a bureaucracy that has become a powerful tool in China’s vast censorship operation. It proactively censors its Chinese App Store, relying on software and employees to flag and block apps that Apple managers worry could run afoul of Chinese officials.”
In its transparency report for the first-half of 2020, Apple said it complied with all 46 requests from China’s government to remove 152 apps from the Apple Store. The report did not explain why the apps were removed.
The Resolution cites a report from Institutional Shareholder Services that says Apple’s “quantitative approach” offers little context for the app removal requests from the Chinese government or explanation of the risks that may be involved.
Shareholders, according to the Resolution, “are deeply concerned about a material failure in Apple’s transparency reporting that seemingly highlights a contradiction between Apple’s human rights policy and its actions regarding China and its occupied territories, which represent almost a third of Apple’s customer base. This poses significant legal, reputational and financial risk to Apple and its shareholders.”
The shareholders want Apple’s board to revise corporate transparency reporting to provide clear explanations of the number and categories of app removals from the app store, in response to or in anticipation of government requests.
Apple opposes the Resolution.
It says the “Matters of Note” section in the transparency report explains “that certain of the removed apps were gambling apps, or that a government sought to remove certain apps because they were identified as state security violations."
Those qualitative descriptions “provide insight as to the types of content that governments in each country or region prohibit, and readers can discern from these descriptions whether the apps at issue relate to freedom of expression or access to information,” according to Apple.