The tech backlash has caught up to Apple. The activist hedge fund Jana Partners and the California State Teachers’ Retirement System want Apple to give parents better controls over their children’s iPhones. It’s an unusual issue for an activist, and apps from Facebook and Snap would make better targets.
Together, the hedge fund and teachers’ pension giant want Apple to take responsibility for how its products are affecting children. In a letter to the board on Saturday, the activists — which include the pop star Sting and his wife, Trudie Styler, as advisers — cited research that suggests heavy smartphone use is linked to a rise of depression and suicide among teenagers and young adults.
The popularity of the iPhone, which was introduced more than a decade ago, has spread to an ever-younger demographic, leaving educators and researchers scrambling to understand how it may be affecting children’s development. Yet other technology outfits are culprits, too, and provide rich targets. More people have smartphones that run on Google’s Android system, rather than on Apple’s operating system. Facebook’s and Snapchat’s business models depend on increasing the time spent on mobile phones and target children under the age of 13 with specialized apps.
It’s a worthy theme to explore but a departure for Jana. The hedge fund, led by Barry Rosenstein, is best known for getting tangible results measured in dollars by agitating for things like a sale of Whole Foods or a shake-up of the board of Tiffany. In this case, it’s smartly teaming up with Calstrs, the largest public-sector teachers’ pension fund in the United States and one that’s increasingly emphasizing social responsibility with its investments. Together, the two hold roughly $2 billion worth of Apple stock.
The fact that Jana is starting a campaign in the more squishy territory of sustainability and ethics could signal a broader shift in the winds. Investors are increasingly pushing companies to address a wider range of issues and risks. Exxon Mobil and climate change are one example. Gender equality and the ability to attract more diverse talent are also issues that are rising to the level of proxies.
Silicon Valley used to enjoy an exalted status, but questions about the role of social media in the 2016 presidential election and the way digital technologies may threaten jobs and promote monopolies are breeding skepticism. The new focus on Apple shows how much technology has lost its halo.
Continue reading the main story