Steve Swirsky Quoted in “Investor Proposals Turn Up Heat in Organizing Campaigns”

Shareholders at companies facing high-profile union drives are increasingly proposing audits and changes to the companies' labor policies, in some cases holding unprecedented leverage to influence campaigns that labor regulators are watching closely. …

The concern that the reviewer will be independent but "not necessarily neutral" tips both ways, said Steven M. Swirsky, [Member of the Firm] at Epstein Becker & Green PC, who represents employers. Swirsky said he isn't referring to any particular companies, but on the general issue of shareholder activism.

He said he's noticed several times when workers and unions have asked for third-party audits of an employer's labor practices.

The organizations that are "acceptable to the union side to do these audits and make recommendations come into it with a preexisting point of view," he said. Because those audits were done by a third party, "it then becomes harder to explain why those recommendations are not in the best interest of the company or the shareholders," Swirsky said.

While Suflas said most of the recent labor-related shareholder proposals have been confined to companies facing high-profile union campaigns, and he said he doesn't expect them to expand further, Swirsky anticipates more of these investor proposals moving forward.

"There has been an evolution in points of view … as to what the obligations are of a corporation, who is the corporation intended to serve the interests of?" he said. "Historically it has always been to maximize value for the shareholders. What you've seen is, in the last five or 10 years in a row, some variance from that."

"Companies are starting to recognize they have to articulate a broader vision of what their obligations are to society, and so that may be another cracking open of the door that the advocates for these shareholder initiatives may try to take advantage of," Swirsky said.