WASHINGTON, D.C. – Yesterday, America First Legal (AFL) sent a letter to Apple’s CEO and Board of Directors demanding that Apple end its illegal diversity, equity, and inclusion (DEI) programs, warning that the Board’s recommendation to reject a shareholder proposal to eliminate DEI at the company’s upcoming annual meeting later this month poses significant material risks to investors and shareholders.
The Board’s Opposition to the Shareholder Proposal to End DEI
Apple shareholders have proposed a resolution (Proposal Number 6) requesting that the company abolish its DEI “program, policies, department and goals.” In its Proxy Statement, Apple’s Board recommended that shareholders vote “No” on Proposal Number 6, claiming that “the proposal is unnecessary as Apple already has a well-established compliance program.”
The Apple Board’s statement suggests or appears aimed at leading shareholders to believe that the company does not discriminate. However, Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, sex, religion, or national origin.
The Company Apparently Engages in Intentional and Unlawful Discrimination
AFL has obtained evidence of Apple’s Vice President of Core OS – Software Engineering, Jon Andrews, candidly discussing Apple’s discriminatory hiring practices — what amounts to a “Rooney Rule” — during two separate “all-hands” meetings in the past year. Andrews said, in part:
We’ve made some changes to the way we do manager hiring … There’s two questions at the top of an offer when it goes to approval. One is that a female was interviewed and that a URE [underrepresented employee] was interviewed. And … for management positions, I have said that I won’t approve an offer unless there’s a yes next to one of those.
Andrews’ statement is not mere puffery. Apple’s website boasts, “Over the past year, we filled more open leadership roles than ever with women globally and Black candidates in the United States.”
This racially discriminatory hiring program facially violates civil rights laws and directly refutes the Board’s assertions that Apple runs a “well-established compliance” program and “does not discriminate in recruiting, hiring, training, or promoting on any basis protected by law.”
The Board Ignores Market and Enforcement Risks of DEI and ESG
AFL’s letter warns that Apple is misleading investors by concealing DEI and the related environmental, social, and governance (ESG) market and enforcement risks. Management identifies risks potentially associated with failing to achieve left-wing ESG goals without mentioning backlash, consumer boycotts, or legal liability — including federal investigations and lawsuits — that could result from Apple’s DEI and ESG programs.
Further, AFL’s letter highlights how multiple companies — such as Gillette, Bud Light, and Target — have suffered massive reputational and financial damages due to unlawful DEI policies, yet the Apple Board fails to address these risks.
Shifting Legal Landscape
AFL’s letter informs the Board that it has failed to account for and disclose updates in the law that now attach additional risk to DEI programs.
Apple knows or should know that AFL previously filed a lawsuit against Target and successfully pled the case that Target’s Board of Directors violated federal securities laws by issuing proxy statements that falsely and misleadingly claimed that the Board oversaw social and political issues arising from Target’s pursuit of ESG and DEI mandates and that these policies were adopted to advance shareholders’ pecuniary interest. This legal risk is increased further by a recent class action lawsuit filed against Target on the same legal theory.
Beyond the recent developments in securities litigation, the Trump Administration has sent a clear signal that racial discrimination will not be tolerated. President Trump recently signed Executive Order 14173, titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” directing agency heads to identify potential civil compliance investigations of publicly traded corporations.
Since President Trump signed EO 14173, the Federal Communications Commission has opened an investigation into Comcast for its discriminatory DEI programs. Acting EEOC Chair Andrea Lucas has also signaled that the EEOC will be taking a closer look at corporate DEI programs.
Accordingly, AFL’s letter further warns that President Trump’s Executive Order could impact Apple as a federal contractor.
Statement from Reed D. Rubinstein, America First Legal Senior Vice President:
“Apple’s illegal DEI programs are dangerous, demeaning, and immoral; they deny, discredit, and undermine the traditional American values of hard work, excellence, and individual achievement in favor of an unlawful, corrosive, and pernicious identity-based spoils system. Apple’s shareholders understand that the company is doing wrong and risking its bottom line. Apple’s management needs to wake up and comply with the law,” said Reed D. Rubinstein.
Statement from Andrew Block, America First Legal Senior Counsel:
“America First Legal is committed to enforcing the law and holding corporations accountable. Apple’s Board has a responsibility to inform its shareholders of the risks of its actions, especially when those actions make the company a target for investigations and lawsuits from employees, regulators, or federal law enforcement. We urge the Board to reconsider its recommendation on Proposal Number 6 and to join the growing list of companies abolishing their DEI programs,” said Andrew Block.
Read the letter here.
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