Uber shareholders voted against a proposal that would require the taxi company to fully disclose its direct and indirect lobbying activities and spending, according to a regulatory Submit released Thursday.
The measure has already been proposed and rejected by shareholders. But this year’s results show that a growing number of shareholders are eager to demand full disclosure. About 45% of shareholders voted in favor of the measure, up from about 30% last year. Two-thirds of shareholders must vote in favor to approve a proposal.
The increase in votes represents a victory for proponents in what will certainly be a years-long process of encouraging companies like Uber to be more lenient in their spending.
The proposal, submitted by the International Brotherhood of Teamsters, argues that Uber’s lack of full disclosure about its lobbying activities poses multiple risks to the company. The most obvious is the potential reputational risk to the company if it turns out to support a cause that its users consider to be off-putting.
The real risk, says Teamster senior government analyst Michael Pryce-Jones, is in the sustainability of the company itself.
“How much do you have to lobby to grow your markets or defend your markets? Because that takes away from the resilience of how you make money,” Pryce-Jones previously told businesstraverse.com.
The vote comes as Uber, along with other app-based gig companies, continues to lobby hard and support so-called grassroots organizations devoted to independent workers’ rights to keep gig workers classified as contractors rather than employees. Uber’s business model relies on not paying drivers and delivery drivers as employees, which includes benefits such as minimum wage and sick leave, as well as protections such as workers’ compensation.
Most infamously, Uber contributed about $30 million to a campaign (which eventually raised more than $200 million) in California to make it to Proposition 22. The company is actively working to pass similar laws in other states in the country, such as Massachusetts, Colorado, Illinois, New Jersey, New York, and Washington.
Three other proposals were submitted and approved on Monday, all with recommendations from the board to vote in favour. The first is a proposal to elect 11 directors until the 2023 annual meeting and until their successors are elected. The selected drivers are currently on Uber’s board.
Uber’s shareholders also voted to approve, on a non-binding advisory basis, the 2021 compensation of Uber’s named executive officers. CEO Dara Khosrowshahi’s target compensation is split into 6% in salary, 12% in cash bonus and 82% in long-term equity. In practical terms, that amounts to $1 million in salary, $16 million in stock awards, $2.4 million in non-equity incentive plan compensation (which is essentially just a bonus), and $507,738 in other compensation (mainly for security benefits). and personal safety costs), totaling a whopping $20 million in 2021 CEO compensation.
For the other executives, the breakdown was 9% salary, 9% cash bonus and 82% long-term equity. Here is an overview of the total compensation for the executives:
- Nelson Chai, CFO: $6.8 million
- Jill Hazelbaker, SVP of Marketing and Public Affairs: $7.9 million
- Tony West, SVP, Chief Legal Officer and Corporate Secretary: $7.4 million
- Nikki Krishnamurthy, SVP and Chief People Officer: $10.7 million
Uber has a philosophy for how it compensates executives that supports its goals of attracting and retaining talent, aligning executive incentives with business performance, providing further financial incentives for achieving certain milestones, and “strengthening cultural norms.” whatever that means.
Here’s a snippet of Uber’s compensation philosophy, taken from a regulation Submit†
To drive long-term shareholder value creation and link our executives’ compensation to these long-term strategic goals and key drivers of our business, the primary focus of our compensation philosophy and program is on the long-term elements of target total compensation.
Finally, Uber’s shareholders voted to endorse the appointment of PricewaterhouseCoopers LLP as the company’s independent registered accounting firm for 2022. Not surprising, given that PwC has also served as Uber’s accounting firm for the past two fiscal years.