BURNABY– Today, leading global proxy advisory firm Institutional Shareholder Services (ISS) became the third prominent proxy advisory firm to back a human rights shareholder proposal at Thomson Reuters (TSX/NSE: TRI). The shareholder proposal, filed by the B.C. Government and Service Employees' Union (BCGEU), was filed in response to Thomson Reuters's work for U.S. Immigration and Customs Enforcement (ICE).
Both Glass Lewis and UK based Pension and Investment Research Consultants have also advised investors to back the proposal which goes to a vote at Thomson Reuters's 2021 annual general meeting on June 9, 2021.
Thomson Reuters has made its CLEAR® investigation software available to ICE where it has been used to track and arrest immigrants and asylum seekers. The shareholder proposal asks the company to identify potential human rights risks as the company transitions to a technology and AI business. Thomson Reuters's lags behind its technology peers like Microsoft, Amazon, IBM, RELX (owner of Thomson LexisNexis) and salesforce.com who have all adopted approaches to human rights.
According to ISS:
"… the company's Trust Principles which governed it as a media company no longer appear to be sufficient in addressing the human rights risks that might arise from the company's changing business. To address its changing business, the company adopted the AI principles in 2020 …[h]owever, these are high level principles and do not establish a process that addresses the access to information risks, as well as related human rights risk and a chain of board and management accountability.
Given the controversy the company is involved in and in the absence of clear policies and processes to mitigate these human rights risks and manage future risks as it transforms to an AI technology company, the specific disclosure requested by the proponents could be beneficial to shareholders and their ability to assess the ongoing risks and have comfort that the company and the board are appropriately prioritizing their oversight of these risks. Furthermore, it appears the company's strategy should be informed by the UNGPs as the most widely accepted set of governing principles on human rights risks. In light of the above, support for this shareholder proposal is warranted at this time."
Last year, a similar resolution received nearly 30% vote of support by independent shareholders.
"These critical endorsements make it clear that Thomson Reuters must take its commitment to human rights more seriously as it transitions to a technology and AI business," said BCGEU President Stephanie Smith. "As a union we understand that standing up for human rights around the world is essential to our collective progress towards social justice, and we hope to see a strong vote on this proposal on June 9th."
"Thomson Reuters has a long history of supporting immigration enforcement in the United States, including funneling the data of tens of millions of Americans directly to U.S. Immigration and Customs Enforcement, which has used this data to terrorize and deport immigrants throughout the country," said Jacinta Gonzalez, senior campaign organizer for #NoTechforICE at Mijente. "They continue to provide ICE with technology for deportations and raids, which continue under the Biden administration. The company has a responsibility to investigate these practices for human rights abuses."
Historically a publishing business, Thomson Reuters announced its "Change Program" in 2021 to transition the company "from a content provider to a content-driven technology company." The company will increasingly rely on artificial intelligence and machine learning to grow revenues, and TRI sees its U.S. government business as a key driver for growth.
Thomson Reuters says its contract with ICE has expired, however the company still has at least $4.5 million in active contracts with the U.S. Immigration and Customs Enforcement, as well as other contracts with the U.S. Department of Homeland Security that involve electronic intelligence research tools and data analysis.
Thomson Reuters' virtual annual general meeting takes place on June 9, 2021.
View the investor briefing here.
View the and the excerpt from management circular here on page 113 or B-1.
Emma Pullman | Capital Markets Advisor | B.C. Government and Service Employees' Union (BCGEU) | [email protected]
The BCGEU is one of the largest unions in B.C. with over 80,000 members in almost every community and economic sector in the province. Learn more at www.bcgeu.ca
Under BCGEU's responsible investment strategy, the union has engaged with some of Canada's largest and most influential companies on issues including human rights, worker's rights, sexual misconduct, and executive compensation. The union's strategy has succeeded in achieving strong commitments on human rights due diligence, executive compensation, food waste and climate disclosure.