Internet censorship, shareholders have their say

Investors in two major US Internet Service Providers (ISPs),  CenturyTel Inc and EarthLink Inc, have voted strongly in favour of a shareholder resolution which highlights Internet management practices at the ISPs and their role in Internet privacy and censorship.

The resolutions, which were filed and voted on for the first time this year, attracted 30.49% of the vote at CenturyTel and 9.25% at EarthLink. According to the resolutions’ proponents, The Open Media and Information Companies Initiative – Open MIC , the votes mean that investors worth more than $900 million voted in favor of the resolutions at the two companies.

A third shareholder resolution was filed with Knology Inc on the same issue. The company has publicly agreed to revise its Internet privacy policy and as a result the resolution has been withdrawn.

Resolutions were originally filed at 10 US quoted ISPs in January this year, urging corporate boards to report on the impact of the companies’ Internet network management practices on public expectations of freedom of expression and privacy. The coalition of investors behind the filing included the New York City Pension Funds and leading socially responsible investment managers Trillium Asset Management, Boston Common Asset Management, Calvert Asset Management Company, Domini Social Investments, Harrington Investments and the As You Sow Foundation.  The New York City Pension Funds collectively hold more than 10.5 million shares in the six ISPs where they were the lead filer. 

ISP network management practices have come under public scrutiny by consumer and civil liberties groups, regulatory authorities and shareholders in the US and the resolutions asserted that “Internet network management is a significant public policy issue; failure to fully and publicly address this issue poses potential competitive, legal and reputational harm” to each of the companies.

Commenting on the filings earlier this year, New York City Comptroller William C. Thompson Jr said: “These ISPs are among the biggest in the world and if the network management practices are having an effect on how the public perceives the companies, we as shareholders have a right to know what that effect may be.”

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