Uber Technologies Inc. will conduct an independent civil-rights audit after compromising with shareholders who had pushed for the company to examine its practices.

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board Chairman Ron Sugar announced the commitment Monday at the company’s annual general meeting, which was only open to shareholders. A webcast replay of the meeting was made publicly available Tuesday. At the meeting, Sugar announced that the company would be conducting a civil-rights “assessment” in what he called “a positive outcome” after conversations with an alliance of investor groups and shareholder advocates.

SOC Investment Group — which has successfully pushed for civil-rights and racial-equity audits at Citigroup Inc.
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and JPMorgan Chase & Co.
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— led the alliance in submitting a proposal for such an audit, and withdrew the proposal after securing a commitment from the ride-hailing and delivery giant.

The proposal, also by As You Sow and Friends Fiduciary, urged Uber’s board to oversee “a third-party audit analyzing the adverse impact of Uber’s policies and practices on the civil rights of company stakeholders, above and beyond legal and regulatory matters, and to provide recommendations for improving the company’s civil-rights impact.”

See: Uber, Lyft face shareholder push to disclose how much they are spending in fight for new labor laws

There is no known timeline yet for the audit, and Uber did not respond to a request for comment before publication.

The alliance mentioned several reasons for the proposal, including:

  • Uber’s leadership is not diverse enough, specifically “only 3.8% and 5.2% of its leadership are Black and Hispanic, respectively.”

  • The company’s business model belies its stated attempt to be anti-racist because “misclassification of independent contractors has been found to disproportionately affect racial minorities.”

  • The company’s corporate contributions are not fully aligned with its public statements, such as contributions “to police foundations in Atlanta and Los Angeles that critics note bypass normal procurement processes to buy equipment for police departments, including surveillance technology that has been used to target communities of color.”

  • Uber being fined by the California Public Utilities Commission for refusing to disclose sexual-assault information.

  • A study by George Washington University researchers that found evidence of racial discrimination in Uber’s pricing algorithm.

Dieter Waizenegger, executive director of SOC Investment Group, said in a statement that the company “demonstrated openness and is taking important first steps” to address investors’ concerns. He said Uber should now “apply the same due diligence throughout the process” of consulting with community stakeholders and choosing civil-rights experts to conduct the audit.

It was a mixed day for shareholder activists, though, as a shareholder proposal urging more transparency surrounding Uber’s lobbying activity appears to have failed to get a majority vote. The proposal by the International Brotherhood of Teamsters gained support from last year’s attempt, though, receiving 45% of yes votes this year compared with 31% last year, according to preliminary results; official vote tallies are expected to be filed with the Securities and Exchange Commission by the end of the week.

Also: Apple investors pass civil-rights audit and another shareholder proposal

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