STOCKHOLDER PROPOSALSTABLE OF CONTENTS
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34 | | TWITTER, INC. / 2019 Proxy Statement | |
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PROPOSAL NO. 4 STOCKHOLDER PROPOSAL REGARDING
SIMPLE MAJORITY VOTEPROPOSAL NO. 4
STOCKHOLDER PROPOSAL REGARDING SIMPLE MAJORITY VOTE
James McRitchie, 9295 Yorkship Court, Elk Grove, CA 95758, has represented that he is the beneficial owner of 297 shares of Twitter’s common stock and has given notice of his intention to present the proposal below at the Annual Meeting. The proposal and the proponent’s supporting statement appear below.
The board of directors opposes adoption of the proposal and asks stockholders to review our opposition statement, which follows the proponent’s proposal and supporting statement.
Proposal and Supporting Statement by Stockholder Proponent
Proposal 4—Simple Majority Vote
RESOLVED, Twitter, Inc. (“Twitter” or “Company”) shareholders request that our board take each step necessary so that each voting requirement in our charter and bylaws that calls for a greater than simple majority vote be eliminated, and replaced by a requirement for a majority of the votes cast for and against applicable proposals, or a simple majority in compliance with applicable laws. This means the closest standard to a majority of the votes cast for and against such proposals consistent with applicable laws. It is also important that our company take each step necessary to avoid a failed vote on this proposal topic.
Supporting Statement: Shareowners are willing to pay a premium for shares of companies that have excellent corporate governance. Supermajority voting requirements have been found to be one of six entrenching mechanisms that are negatively related to company performance according to “What Matters in Corporate Governance” by Lucien Bebchuk, Alma Cohen and Allen Ferrell of the Harvard Law School (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=593423).
Last year, for example, at Salesfore.com [sic] 80.1% of shares in favor of our proposal to move to a simple majority vote standard. Among large Twitter shareholders voting in favor of the similar proposal at Salesforce.com were the following: Fidelity, BlackRock, T. Rowe Price, SSgA, Morgan Stanley, First Trust Advisors, Northern Trust, Geode Capital, TIAA-CREF. In fact, 285 funds voted in favor while only 32 voted against and 3 abstained.
This proposal topic won from 59.2% to 80.1% of the vote at Kaman, DowDuPont, Ryder System and Salesforce.com in 2018. Prior to that, it won 74% to 99% support at Weyerhaeuser, Alcoa, Waste Management, Goldman Sachs, FirstEnergy, McGraw-Hill, Macy’s, Ferro Arconic, and Cognizant Technology Solutions.
Currently a 1% special interest minority of shares can frustrate the will of shareholders casting 79% of shares in favor. In other words a 1% special interest minority could have the power to prevent shareholders from improving our corporate governance.
Please vote again to enhance shareholder value:
Simple Majority Vote—Proposal 4
The Company’s Statement of Opposition
Our Amended and Restated Certificate of Incorporation and Bylaws provide for a simple majority vote standard for all corporate matters submitted to a vote of our stockholders, except for a more stringent voting requirement with respect to amending our Certificate of Incorporation or Bylaws. These enhanced voting requirements for amending our Certificate of Incorporation or Bylaws are intended to protect the long-term interests of our stockholders and the company, rather than allowing changes that may be focused on short-term objectives or otherwise jeopardize the long-term success of the company. We believe that when amendments are proposed to our Certificate of Incorporation or Bylaws that could have a long-term impact on our company, a higher threshold of stockholder approval should be required to determine whether such changes are appropriate and are in the best interests of our stockholders and the company.
Additionally, as described above in the section titled “Board of Directors and Corporate Governance—Board Meetings and Committees—Majority Voting with Director Resignation Policy,” as a result of feedback from our shareholders, in 2017 we amended our Bylaws and Corporate Governance Guidelines to implement a majority voting standard for the election of directors in an uncontested election with a director resignation policy. Full details of our majority voting with director resignation policy for nominees are set forth in our Bylaws and our Corporate Governance Guidelines, available athttp://investor.twitterinc.com.
Furthermore, the amendment provisions in our Certificate of Incorporation and Bylaws were implemented before our
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PROPOSAL NO. 4 STOCKHOLDER PROPOSAL REGARDING SIMPLE MAJORITY VOTE
initial public offering, and all of our investors who purchased shares of our common stock in our initial public offering and after were aware of these provisions.
For the above reasons, our board of directors believes that this proposal is not in the best interests of Twitter or our stockholders, and unanimously recommends that you vote “AGAINST” this proposal.
Vote Required
The approval of this Proposal No. 4 requires the affirmative vote of a majority of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the effect of a vote AGAINST the proposal and brokernon-votes will have no effect.
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE
“AGAINST” PROPOSAL NO. 4
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36 | | TWITTER, INC. / 2019 Proxy Statement | |
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PROPOSAL NO. 5 STOCKHOLDER PROPOSAL REGARDING AAN EEO POLICY RISK REPORT ON OUR CONTENT ENFORCEMENT POLICIES
PROPOSAL NO. 5
STOCKHOLDER PROPOSAL REGARDING A REPORT ON OUR CONTENT ENFORCEMENT POLICIES
The New York State Common Retirement Fund(co-filer), 59 Maiden Lane, 30th Floor, New York, NY, 10038, has represented that it is the beneficial owner of 1,412,700 shares of Twitter’s common stock, and Arjuna Capital(co-filer), have together given notice of their intention to present the proposal below at the Annual Meeting. The proposal and the proponents’ supporting statement appear below.
The board of directors opposes adoption of the proposal and asks stockholders to review our opposition statement, which follows the proponents’ proposal and supporting statement.
Proposal and Supporting Statement by Stockholder Proponent
CONTENT GOVERNANCE
WHEREAS: Twitter faces continued global controversy regarding Russia’s reported interference in U.S. elections and the distribution by users of disinformation and hate speech that can threaten marginalized groups and undermine democracy.
Shareholders are concerned that Twitter’s failure to proactively address these issues has created regulatory, legal, and reputational risks. We believe Twitter has an obligation to demonstrate how it governs content to prevent violations of its terms of service.
The Company’s content governance policies appear to lack a strategic approach.
For example, in August 2018, even after Apple, Facebook, and YouTube banned conspiracy theorist Alex Jones, CEO Jack Dorsey defended a decision to permit Jones to remain on Twitter despite suspending Jones for inciting violence. One month later, Twitter banned Jones after he allegedly harassed other users.
Twitter’s policy against fact-checking fake news also remains a serious controversy. In thelead-up to the 2018 U.S. midterm elections, Oxford University researchers said Twitter had 5 percent more false content than during the 2016 American presidential election.
A 2018 Amnesty International report (“Toxic Twitter’’) concluded that “for many women, Twitter is a platform where violence and abuse against them flourishes, often with little accountability.” The report said Twitter was “inadequately investigating and responding to reports of violence and abuse in a transparent manner.” And while Twitter has announced a new “dehumanizing speech” policy, the efficacy of the policy is unclear.
In September 2018 CEO Dorsey told a Senate committee there will be “massive shifts” in how Twitter and other social media companies operate when attempting to stop election interference and deceptive messages. “We need to question the fundamental incentives that are in our product today,” Dorsey said. Twitter shares fell as much as 6.7 percent as he testified.
After Dorsey’s testimony to Congress in September, lawmakers wrote to Dorsey, noting: “we remain concerned that Twitter’s policies and terms of service, which should safeguard against [racially divisive content and misinformation] are vague and inconsistently applied.”
RESOLVED: Shareholders request Twitter issue a report to shareholders, at reasonable cost, omitting proprietary or legally privileged information, reviewing the efficacy of its enforcement of its terms of service related to content policies and assessing the risks posed by content governance controversies (including election interference, fake news, hate speech and sexual harassment) to the company’s finances, operations and reputation.
SUPPORTING STATEMENT: Proponents recommend the report include assessment of the scope of platform abuses, impacts on free speech, and address related ethical concerns.
The Company’s Statement of Opposition
Our board of directors has considered this proposal and believes the preparation of a report as requested by this proposal is unnecessary in light of our current practices, level of public transparency about these matters (including quarterly reporting on our efforts and progress to our investors), and our key initiatives. We further believe that the expanded disclosure requested by the proposal could reduce the effectiveness of our safety efforts by providing a roadmap for those bad actors who are seeking to evade abiding by our terms.
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PROPOSAL NO. 5 STOCKHOLDER PROPOSAL REGARDING A REPORT ON OUR CONTENT ENFORCEMENT POLICIES
One of the fundamental purposes of Twitter is to give everyone the power to create and share ideas and information instantly, without barriers. In order to protect the experience and safety of people who use Twitter, there are some limitations on the type of content and behavior that we allow. These limitations are set forth in the Twitter Rules (along with all incorporated policies), Privacy Policy, and Terms of Service which collectively make up the “Twitter User Agreement” that governs a user’s access to and use of Twitter’s services. All individuals accessing or using Twitter’s services are required to adhere to the policies set forth in the Twitter User Agreement. Failure to do so may result in Twitter taking certain enforcement actions, including permanently suspending an account. The Twitter User Agreement contains robust content boundaries and restrictions on the use of Twitter including on violence, adult content, abuse, unwanted sexual advances, hateful conduct, hateful imagery, private information, intimate media, impersonation and spam. We have a rigorous framework and have devoted significant resources to enforcing the rules in the Twitter User Agreement. Improving the health of conversations on Twitter was one of our primary areas of focus in 2018 and continues to be going forward.
In 2018, we took important steps to increase the collective health, openness, and civility of the public conversation on Twitter, helping people see high-quality information, strengthening oursign-up and account verification processes, and preventing the abuse of Twitter data.
Specific actions we took in 2018 included: strengthening account security, updating our rules to more clearly address specific types of hateful conduct, taking new behavior-based signals into account when presenting and organizing Tweets, making it easier to see when a Tweet was removed for breaking our rules, and expanding our team through increased hiring and the acquisition of Smyte Inc., a Delaware corporation. In the fourth quarter, our machine learning efforts continued to improve, making it harder for malicious accounts to game our service through multiple accounts and evading suspension, resulting in the suspension of millions of spammy and suspicious accounts.
Our focus on improving the health of the public conversation on Twitter delivered promising results in 2018. As we have previously reported, we saw a 16% year-over-year decrease in abuse reports from people who had an interaction with their alleged abuser on Twitter, and enforcement on reported content that was 3 times more effective.
In 2019, we will take a more proactive approach to reducing abuse and its effects on Twitter, with the goal of reducing the burden on victims of abuse and, where possible, taking action before abuse is reported. Our initial focus will be on those types of abuse most likely to result in severe and immediate harm. We will also continue to strengthen our login andsign-up processes to make it more challenging for bad actors to take advantage of accounts for abusive or malicious purposes. We will continue to prioritize the health of the public conversation on Twitter so people feel safe being a part of the conversation and are able to find credible information on our service.
We also believe in being transparent with respect to our rules and how we enforce them, and have made significant progress in reporting out to all of our users on our progress. Specifically, we regularly share the progress we have made on our blog (available at: https://blog.twitter.com) in the following areas:
We made updates to the Twitter User Agreement to reduce hateful and abusive content on Twitter, to provide clearer guidance around key issues impacting the integrity of elections across the globe, and to better reflect how we identify fake accounts and what types of inauthentic activity violate our guidelines.
We updated the Twitter Rules regarding attributed activity so that if we are able to reliably attribute an account on Twitter to an entity known to violate the Twitter Rules, we will remove additional accounts associated with that entity. We have also expanded our enforcement approach to include accounts that deliberately mimic or are intended to replace accounts we have previously suspended for violating our rules.
We began providing regular, real-time updates about our progress, including a calendar of upcoming changes we plan to make to the Twitter User Agreement.
We disclosed the many changes we made to the Twitter platform to make it a safer space, including updating how you can report abusive Tweets, stopping the creation of new abusive accounts, implementing safer search results, collapsing abusive orlow-quality Tweets, reducing notifications, leveraging our technology to reduce abusive content, giving users more control with additional tools and communicating more clearly about the actions we take. We also released data on the progress we’ve made, what we’ve learned, and our plans to continue improving on some of our safety initiatives, including on increasing action on abusive accounts, driving change in behavior and providing personalized controls.
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38 | | TWITTER, INC. / 2019 Proxy Statement | |
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PROPOSAL NO. 5 STOCKHOLDER PROPOSAL REGARDING A REPORT ON OUR CONTENT ENFORCEMENT POLICIES
We began working with safety advocates, academics, and researchers; grassroots advocacy organizations that rely on Twitter to build movements; and community groups working to prevent abuse, in each case to get their input on our safety products, policies, and programs.
We announced the formation of the Global Internet Forum to Counter Terrorism to help us continue to make our hosted consumer services hostile to terrorists and violent extremists, with an initial focus on technological solutions, research and knowledge-sharing.
We provided regular updates to both congressional committees and the public on findings from our review into events surrounding the 2016 U.S. election. We informed our users about malicious activity directly, provided examples of the malicious content, disclosed the numbers of malicious accounts and Tweets, launched initiatives to enhance information quality (including further investments in machine learning, developing new techniques for identifying malicious automation and placing limitations on certain user abilities to perform coordinated actions) and partnered with media literacy organizations.
We disclosed our approach to bots and misinformation and the initiatives we have made to ensure that we are surfacing the highest quality and most relevant content and context first.
Based on feedback from our shareholders, we have made the above information easy to find in the “Health and Safety” section of our Investor Relations website at https://investor.twitterinc.com/corporate-governance.
We also publish our Twitter Transparency Report biannually (available at: https://transparency.twitter.com), which includes trends in legal requests, intellectual property-related requests, Twitter Rules enforcement, platform manipulation, and email privacy best practices. In 2018 we added a Twitter Rules enforcement section to our Twitter Transparency Report, which provides an overview of how and when we enforce our content policies, including enforcement information on abuse, hateful conduct, private information, child sexual exploitation, sensitive media, and violent threats. In 2018 we also added a new platform manipulation section, which includes metrics pertaining to our actions to fight malicious automation and spam.
For the above reasons, our board of directors believes that this proposal is not in the best interests of Twitter or our stockholders, and unanimously recommends that you vote “AGAINST” this proposal.
Vote Required
The approval of this Proposal No. 5 requires the affirmative vote of a majority of the shares of our common stock present virtually or by proxy at the Annual Meeting and entitled to vote thereon. Abstentions will have the effect of a vote AGAINST the proposal and brokernon-votes will have no effect.
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE
“AGAINST” PROPOSAL NO. 5
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| | TWITTER, INC. / 2019 Proxy Statement | | 39 |
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PROPOSAL NO. 6 STOCKHOLDER PROPOSAL REGARDING BOARD QUALIFICATIONS
PROPOSAL NO. 6
STOCKHOLDER PROPOSAL REGARDING BOARD QUALIFICATIONS
The National Center for Public Policy Research, 20 F Street, NW Suite 700, Washington, DC 20001, has represented that it is the beneficial owner of at least $2,000 in market value of Twitter’s common stock and has given notice of its intention to present the proposal below at the Annual Meeting. The proposal and the proponent’s supporting statement appear below.
The board of directors opposes adoption of the proposal and asks stockholders to review our opposition statement, which follows the proponent’s proposal and supporting statement.
Proposal and Supporting Statement by Stockholder Proponent
True Diversity Board Policy
Resolved,
RESOLVED
Shareholders request that the shareholders of the [sic] Twitter Inc. (the “Company”(“Twitter”) requestissue a public report detailing the Board adoptpotential risks associated with omitting “viewpoint” and “ideology” from its written equal employment opportunity (EEO) policy. The report should be available within a reasonable timeframe, prepared at a reasonable expense and omit proprietary information.
SUPPORTING STATEMENT
Twitter does not explicitly prohibit discrimination based on viewpoint or ideology in its written EEO policy.
Twitter's lack of a company-wide best practice EEO policy
sends mixed signals to
disclosecompany employees and prospective employees and calls into question the extent to
shareholders the following: | 1. | A description of the specific minimum qualifications that the Board’s nominating committee believes must be met by a nominee to be on the board of directors; and
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| 2. | Each nominee’s skills, ideological perspectives, and experience presented in a chart or matrix form.
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The disclosure shall be presentedwhich individuals are protected due to the shareholders through the annual proxy statementinconsistent state policies and the Company’s website within six (6) monthsabsence of the datefederal protection for partisan activities. Approximately half of the annual meetingAmericans live and updated on an annual basis.
Supporting Statement
We believe that boards that incorporate diverse perspectives can think more critically and oversee corporate managers more effectively. By providingwork in a meaningful disclosure about potential Board members, shareholders will bejurisdiction with no legal protections if their employer takes action against them for their political activities.
Companies with inclusive policies are better able to
judge how well-suited individual board nominees are forrecruit the
Companymost talented employees from a broad labor pool, resolve complaints internally to avoid costly litigation or reputational damage, and
whether their listed skills, experience and attributes are appropriateminimize employee turnover. Moreover, inclusive policies contribute to more efficient human capital management by eliminating the need to maintain different policies in
light of the Company’s overall business strategy.The Company’s compliance with Item 407(c)(2)(v) of SEC RegulationS-K requires it to identify the minimum skills,
different locations. experience, and attributes that all board candidates are expected to possess.
Ideological diversity contemplates differences in political/policy beliefs.
True diversity comes from diversity of thought. There is ample evidence that individuals with conservative viewpoints may face discrimination at Twitter.
Many big tech companies are hostile to right-of-center thought. Companies such as Facebook and Google routinely fire conservative employees when they speak their values. At the
Company—2019 annual meeting of Apple shareholders, an audience member told company CEO Tim Cook about her close friend who works at Apple and
Silicon Valley generally—operatelives in
ideological hegemony that eschews conservative people, thoughts, and values. This ideological echo chamber can result in groupthink that is the antithesisfear of
diversity. This canretribution every single day because she happens to be a
major risk factor for shareholders.conservative. Companies such as Amazon and Alphabet work with the Southern Poverty Law Center (“SPLC”). The SPLC regularly smears Christian and conservative organizations by labelling them as “hate” groups on par with the KKK.
Twitter has also been previously linked to the SPLC.1 Twitter has also refused a request to increase the viewpoint diversity of its board. Twitter has also been credibly accused of mistreating conservative voices on its platform.2 This signals to employees that viewpoint discrimination is condoned if not encouraged.
Presently shareholders are unable to evaluate how Twitter prevents discrimination towards employees based on their ideology or viewpoint, mitigates employee concerns of potential discrimination, and ensures a respectful and supportive work atmosphere that bolsters employee performance.
Without an inclusive EEO policy, Twitter may be sacrificing competitive advantages relative to peers while simultaneously increasing company and shareholder exposure to reputational and financial risks.
We
believe a diverse board is a good indicator of sound corporate governancerecommend that the report evaluate risks including, but not limited to, negative effects on employee hiring and
a well-functioning board. Diversity in board composition is best achieved through highly qualified candidates with a wide range of skills, experience, beliefs,retention, as well as litigation risks from conflicting state and
board independence from management.We are requesting comprehensive disclosures about board composition and what qualifications the Company seeks for its Board, therefore we urge shareholders to vote FOR this proposal.
company anti-discrimination policies.
1
| https://www.washingtonexaminer.com/opinion/op-eds/ twitter-dumps-southern-poverty-law-center-stops-making --hate-pay |
2
| https://quillette.com/2019/02/12/it-isnt-your-imagination -twitter-treats-conservatives-more-harshly-than-Iibe |
The Company’s Statement of Opposition
At Twitter, we believe our differences make us stronger. We work to advance a culture of inclusion and diversity—something fundamental to our collective voice and our values. We believe that no one should be discriminated against because of factors such as gender, race, national origin, sexual orientation, gender identity or expression, religion, age, disability, and other legally protected classes. While laws protecting these values may vary in the locations in which we operate, we remain committed to fostering an inclusive and diverse workplace—where people can feel comfortable, be themselves, and do their best work.
In the U.S., we maintain a respectful workplace policy that explicitly prohibits discrimination against employees, applicants and service providers on improper or illegal grounds. Our policy provides that, while we will make legitimate distinctions among applicants and employees based on grounds like skills, performance, experience, and education, we do not permit or tolerate unequal treatment in hiring, job assignments, benefits/compensation, promotion, or dismissal on the basis of any protected characteristics, including political affiliation. We maintain anti-discrimination policies for our non-U.S. locations as well, and continually review and modify these policies to meet local requirements. On our career website (www.careers.twitter.com), we make clear to applicants that we will not discriminate on the basis of any legally protected status.