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Alphabet faces diversity and human rights criticism at stockholder meeting

The meeting comes as the US is engulfed by unrest.

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- 03:39
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Google headquarters in Mountain View, California. 

Stephen Shankland/CNET

At Alphabet's annual stockholder meeting Wednesday, Google's parent company was met by investors critical of its efforts in regard to diversity and human rights. 

The criticism came in the form of shareholder proposals, a common element of big companies' annual meetings, and something institutional investors use as a platform to direct grievances at leadership. But the pushback from critics was especially pronounced this year as civil unrest spreads across the US in response to the death of George Floyd, an unarmed black man killed while in police custody.

One proposal, led by Zevin Asset Management, called for executives' pay packages to be tied to diversity and inclusion goals, a practice adopted by some other tech giants, including IBM and Intel.

"We're asking Alphabet to put its money where its mouth is on inclusion and drive improvement from the top," said Pat Miguel Tomaino, director of socially responsible investing at the firm, who mentioned the Floyd protests in his presentation. 

Another proposal, presented by former Google employee Jack Paulson, called for Alphabet to commit to not litigating against whistleblowers who violate nondisclosure agreements to speak out against human rights issues. Paulson resigned from Google two years ago in response to the company's work on Dragonfly, a censored search product that was meant for the Chinese market.

At the recommendation of Alphabet, all of the shareholder proposals were rejected.

Alphabet's meeting, held virtually, comes as protests have unfolded over the last week in several American cities, including Minneapolis, New York City, Atlanta and Los Angeles. They were sparked by Floyd's death in Minnesota, and a video shot by a bystander that shows Floyd being restrained by a police officer who's pressing his knee down on Floyd's neck.

Alphabet CEO Sundar Pichai began the meeting by talking about the hardships of the coronavirus pandemic, as well as the "additional pain caused by the rash of violence against the black community in the US." Pichai called the deaths of Floyd, Breonna Taylor, Ahmaud Arbery and others "senseless," and said they "compounded the grief people are already feeling."

Earlier in the day, Google said it would commit $12 million over two years to causes related to racial equity. Pichai said the company would also hold an 8 minute and 46 second moment of silence -- the amount of time Floyd was restrained by the officer -- to honor the memory of black people who'd lost their lives. The company also said last week that it's postponing a virtual event scheduled for earlier Wednesday where the company was set to unveil the next version of its Android mobile operating system. The event was delayed in light of the protests, with Google noting, "now is not the time to celebrate."

The company, meanwhile, has faced criticism for scaling back its diversity efforts, including cutting and outsourcing employee training programs, according to a report by NBC News. In response, Pichai said earlier this month that diversity is a "foundational" value for Google.

The shareholder meeting also comes amid a period of major transition at the company. The annual meeting was the first to take place since Pichai took over as Alphabet's CEO, in December, assuming the reins from co-founder Larry Page. Pichai previously led only Google, the largest division of Alphabet. 

There have been other key departures. Former CEO Eric Schmidt, who'd been working as a technical advisor to Alphabet after leaving the board last year, left that role in February, CNET reported. David Drummond, the company's 14-year legal chief, retired in January after scrutiny over past relationships.

As the original management departs, employees and industry observers have questioned whether the world's largest search engine, with more than 120,000 employees around the globe, can maintain its famously freewheeling culture. In the past three years, tensions between management and employees have mounted over the handling of sexual misconduct allegations directed at top executives, a censored search engine project in China and initiatives around artificial intelligence for the US Department of Defense.