SEC Rules Against Exclusion: Apple and Disney Face Shareholder Votes on AI Use
The top U.S. securities regulator, the Securities and Exchange Commission (SEC), has ruled that Apple (AAPL.O) and Disney (DIS.N) must face shareholder votes on their use of artificial intelligence (AI), rejecting requests from both companies to exclude the proposals from their upcoming annual meetings. The labor group behind the proposals, a pension trust of the AFL-CIO, the largest American labor union federation, also has similar AI measures pending at four other technology companies.
The shareholder proposals ask for detailed reports on the companies’ use of AI. Apple is requested to provide information on its use of AI in business operations and disclose any ethical guidelines adopted regarding AI technology. Similarly, Disney is asked to report on its board’s role in overseeing AI usage.
Industry Concerns: AI Adoption Raises Fears in Various Sectors
Concerns have arisen in various industries as corporations increasingly adopt AI for its promised efficiencies. The fear is that AI might replace creative and professional workers or exploit their work unfairly, as highlighted in recent Hollywood labor disputes and a lawsuit by The New York Times.
The AFL-CIO’s supporting statement at Apple emphasizes that AI systems should not be trained on copyrighted works or the performances of professional artists without transparency, consent, and compensation to creators and rights holders.
Brandon Rees, deputy director of the AFL-CIO’s office of investment, sees the SEC’s decisions as potentially paving the way for agreements with Apple and Disney to align their AI disclosures with industry standards, citing Microsoft as an example.
Both Apple and Disney had argued that the proposals were related to ordinary business operations and should be excluded from their ballots. The SEC disagreed, stating that the proposals transcend ordinary business matters and do not seek to micromanage the companies.
As of now, Apple and Disney have not responded to requests for comments on the SEC’s ruling.
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