The SEC has backed New York State Common Retirement Fund's bid to have Amazon.com conduct an independent racial-equity audit.
Officials at the Securities and Exchange Commission denied the online retailer's request to keep the proposal off the ballot at its annual meeting.
In December, New York State Comptroller Thomas P. DiNapoli, trustee of the $247.7 billion pension fund, announced the shareholder proposal that Amazon undergo an independent audit to assess the company's policies and practices on civil rights, equity, diversity and inclusion, and how those affect the company's business.
"Amazon says it stands alongside those fighting systemic racism, yet we continue to see reports of workers facing racial discrimination, accusations of discriminatory wages, and the sale of products that promote hatred," Mr. DiNapoli said in a December statement.
The audit would get input from civil-rights organizations, employees and other stakeholders, and the report would be made public, under the proposal.
Mr. DiNapoli called the SEC's denial of Amazon's request to block the proposal "a victory for the many shareholders who are concerned about racial inequity in corporate America," and said the independent audit "will help ensure the company is confronting institutionalized inequality and the impact on its business."
Amazon, however, did win SEC staff approval to exclude a shareholder proposal from New York City Comptroller Scott M. Stringer on behalf of the $225.4 billion New York City Retirement Systems to have the company report on how well it has addressed health and safety risks from the COVID-19 pandemic, including board oversight.
In a February statement, Mr. Stringer said, "There is a massive disconnect between what Amazon management says it's doing to keep workers safe and what those workers are reporting — and investors have a right to information concerning Amazon's business practices and the success of the company's efforts to protect its workforce."
SEC officials agreed with Amazon's argument that it had substantially implemented the actions referenced in the proposal co-filed with APG Asset Management, and that it was interference with ordinary business operations.
In an emailed statement, Mr. Stringer called the SEC ruling “a severely disappointing decision. When voices of long-term investors are silenced, workers may pay the price.” The New York City pension funds have repeatedly pushed for transparency on the issue because “Amazon’s workers and shareholders deserve strong, impartial board leadership and a scientifically driven approach to employee safety,” he said.