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Will Tesla shareholders succeed in securing improvements for employees?

Tomorrow’s general meeting is an opportunity to recall that sustainability suffers from the absence of minimum societal standards.

Tesla will hold its general meeting this Thursday, August 4. On this occasion, a few proposals aimed at improving the working conditions of employees will be put to the vote.

Tesla is driving the transformation of the automotive sector towards emission-free mobility. However, the company must not only offer solutions adapted to global challenges, it must also ensure that this is done in compliance with minimum standards and without causing significant harm to others.

Tesla’s social record in particular – from its policy of prohibiting unions to discriminatory practices in factories – makes it clear that the company must work on the “how” to be a truly sustainable company. Added to this are environmental problems, such as the recent water shortage at the Brandenburg plant.

For some years now, Tesla shareholders have been trying, through shareholder resolutions, to push the company towards more sustainability. Tomorrow may be the first time this will happen. For the next general meeting, motions have been tabled concerning key points. For the third time in a row, a resolution is up for a vote, asking Tesla to look into the current use of binding arbitration to resolve workplace harassment and discrimination claims. Today, Tesla imposes on its employees that they accept such arbitration, which limits their possibilities of recourse and, above all, reduces the willingness to report discrimination. When disputes are handled through arbitration, the underlying facts and the outcome of the case often remain confidential, which discourages employees from filing a complaint and therefore favors those who discriminate.

The proposal, which comes from Nia Impact Capital, a group of committed female investors focused on gender equality and the fight against racial discrimination, and AP7, Sweden’s largest pension fund, has gained traction. magnitude over the past two years: 27% of the votes in 2020 and 45% of the votes in 2021. Therefore, if an additional 5% of Tesla investors support the proposal this year, it could exceed the 50% mark and take awareness to Tesla of the need to act.

The Canadian non-profit organization Share (Shareholder Association for Research and Education), which works with pension funds and family foundations, has tabled a motion calling on Tesla’s board to adopt a rights policy. work and make it public. This directive should prevent Elon Musk from compromising or hindering the efforts of employees to form or join unions.

The theme of water is also the subject of a shareholder motion: the American NGO As You Sow asks management to assess and report on water-related risks at Tesla as well as all strategies and practices to reduce these risks, from the location of facilities, to preparation, to the reduction of water supply in the context of climate change.

Some requests have a good chance of succeeding, which means that Tesla will have to consider these issues differently than it has done so far. This should improve the working conditions of its employees. Overall, requests from different countries show that Active Ownership is gaining considerably in importance.



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