Google CEO Faces Conflict of Interest Shareholder Proposal
Leading Free-Market Group Says Google's Green Energy Investments Align with Board Member John Doerr and not with Company's Core Business
Washington, D.C. - The National Center For Public Policy Research will attend Google's annual shareholder meeting in Mountain View, California, today to challenge CEO Larry Page over apparent conflicts between his company and its board of directors.
National Center General Counsel Justin Danhof will present a Conflict of Interest Report shareholder proposal (#8 in the proxy statement). The proposal asks the company to issue a report that discloses any board member investments that represent a financial conflict of interest for Google. The proposal also asks Google to specify how it determines when conflicts arise and to detail any actual conflicts that have violated the company's Code of Conduct Policy.
"Google has failed to disclose an apparent conflict of interest with one of its board members related to the company's new foray into green energy investments. Shareholders have a right to know if board members are exerting undue influence or personally benefiting from questionable investments that may damage Google's bottom line," said Danhof.
News reports indicate that Google board member John Doerr may financially benefit from Google's green energy investments. Doerr is a partner at Kleiner Perkins Caufield & Byers, a venture capital firm that is heavily invested in alternative energy. Google is also spending millions of shareholder dollars in the unstable green energy marketplace. One geothermal company, AltaRock, has received millions from Doerr's firm and Google.org. Google's investment in AltaRock presents the appearance that it is for Doerr's financial benefit.
"Google's Code of Conduct is very clear. Googlers, as they refer to themselves, must ask whether a financial situation could be perceived to create an incentive for the employee, and if so, they must avoid the conflict," said Danhof. "The board of directors has a fiduciary duty to the shareholders, not to their own wallets. Doerr and Google need to explain how this apparent conflict arose and how it may affect Google's shareholders."
Additionally, in October 2010, Reuters reported that Google invested an untold amount in a $5 billion offshore wind energy project.
"Google is in the technology and Internet business; its sortie into wind and geothermal energy projects certainly seems arbitrary and begs for an explanation. Green energy markets are completely artificial. Without massive government subsidies these companies would disappear from the market, and Google shareholders will end up blowing in the wind," said Danhof. "Google should return to its technology roots and start working to increase shareholder value rather than lining its board members' pockets."
The National Center For Public Policy Research is a Google shareholder.
The National Center For Public Policy Research is a conservative, free-market, non-profit think-tank established in 1982. Its 2010 revenues were over $12 million. It is supported by the voluntary gifts of over 100,000 individual recent supporters, receiving less than one percent of its revenue from corporate sources. Contributions to it are tax-deductible.