Shareholders of telecom giants AT&T Inc and Verizon Communications Inc are seeking more details related to their sharing of customer information with governments, showing investors starting to push back over the role of communications companies in spying operations.
Activists including Trillium Asset Management of Boston and the 61 billion New York State Common Retirement Fund have filed proposals for the spring shareholder meetings of AT&T and Verizon, representatives said.
Both resolutions call on the companies to report semi-annually on “metrics and discussion regarding requests for customer information by U.S. and foreign governments.”
As carriers of massive amounts of voice and data traffic, the telecommunications companies have been at the center of controversies over the use of their data by U.S. intelligence agencies. Just on Monday the U.S. Supreme Court declined to hear a challenge to a ruling that gave the government access to Verizon records of millions of telephone calls.
A worry is the close ties could hurt the companies’ business, said Trillium Senior Vice President Jonas Kron.
“From an investor perspective, this is one of those issues where there’s an overlap of interests” among privacy advocates and business groups, Kron said. He cited surveys that spying fears could cut tens of billions of dollars from the sales of cloud computingservices.
New York State Comptroller Thomas DiNapoli, sole trustee of the state retirement fund, the prime sponsor of the resolution at AT&T, said “Customer trust is critical for any business, but nowhere is it more so than for those corporations that handle our personal data and communications.”
AT&T spokesman Mark Siegel said that “As standard practice we look carefully at all shareholder proposals but at this point in the process we do not expect to comment on them.”
Verizon spokesman Bob Varettoni declined to comment on the shareholder proposal it received except to say the company is evaluating it.
Customers in growth markets like China have historically mistrusted U.S. technology corporations. Those fears have been stoked by disclosures from former National Security Agency contractor Edward Snowden.
For instance, Cisco Systems Inc last week blamed what some analysts call “the Snowden effect” in part for dismal quarterly revenue. Others have questioned the financial impact of the revelations, however.
In response many technology companies have pushed for — or at least aimed to be seen pushing for — transparency in their dealings with U.S. intelligence agencies.
Companies including Google Inc, Microsoft Corp, Twitter Inc, Facebook Inc, Apple Inc and Yahoo! Inc have published “transparency reports” showing government data requests. Some have in addition gone to court seeking to disclose more details.
Learn more here http://www.nytimes.com/2013/11/21/technology/shareholders-pressure-att-and-verizon-wireless-over-surveillance-role.html