Disney and Apple Set to Address AI Transparency Following AFL-CIO Push

The AFL-CIO's proposal for transparency reports of AI usage will be voted on by shareholders at Disney and Apple's upcoming meetings, as mandated by the SEC.

The Walt Disney Co. and Apple Inc. are set to include a shareholder proposal in their next annual meetings, a move determined by the The Securities and Exchange Commission (SEC). Prompted by the The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) Equity Index Funds, this proposal, aimed at enhancing transparency, calls for these companies to disclose how they utilize artificial intelligence (AI) in their business operations. 

The SEC has mandated that both Disney and Apple need to incorporate these proposals into their proxy statements. The AFL-CIO's request specifically urges Disney to create and publish a transparency report. This report would detail the company's application of AI, the role of the board in overseeing AI usage, and any ethical guidelines the company adheres to concerning AI. A similar request was directed towards Apple, emphasizing the disclosure of ethical guidelines in AI use.

Initially, both Disney and Apple sought to exclude this information, arguing that it pertained to their regular business operations. However, the SEC overruled this, stating that the proposal extends beyond ordinary business matters and does not intend to micromanage the company. Shareholders will now have the opportunity to vote on whether they want a report on AI in the upcoming meetings.

The AFL-CIO is affiliated with unions including the WGA East, Actor’s Equity, Communications Workers of America, and the American Federation of Musicians. The proposal was firstly put forward in October, arguing that “the AI dehumanization of the American workforce threatens the very framework of the nation’s economy and endangers the existence of the already dwindling middle class.”

AI's role and impact in the workforce was a central theme during last year's strikes by the WGA and SAG-AFTRA, underscoring the growing concern over AI's influence in the entertainment industry. This initiative by the AFL-CIO is not limited to Disney and Apple. The union is also aiming to introduce similar proposals in the proxy statements of Warner Bros. Discovery, Comcast, and Netflix. The status of these proposals remains uncertain.