Verizon Shareholder Vote: Opening Remarks on Item 6

Good morning fellow shareholders and Board Members.

 My name is Tracey Rembert and I represent CBIS, an asset manager for Catholic institutions worldwide, and 4 other filers, to present Item 6, calling for an assessment of risks from child sexual exploitation online.

In the 1980s, child pornography had all but been eliminated in the US market, through a crack-down on key distribution channels. But then those distribution channels changed. The Internet ushered in a wave of new technologies, like personal internet access and mobile devices containing high quality digital cameras. Images could be produced anywhere, and then emailed, or stored in the cloud, and were sent with increasing speed. In the past 20 years, what was once a crime largely wiped out is now a flourishing marketplace. The innovations and technologies our company is rightly proud of, have also had the unintended consequence of making it easier to commit sexual crimes against children. Email accounts, digital advertising exchanges, wireless data, cloud storage, online user content—they all help facilitate child sex exploitation. And Verizon depends upon all of them for revenues.

The National Center for Missing and Exploited Children noted that over 45 MILLION images and videos were reported to its Cyber Tipline in 2018–double the number from the prior year. Those reports overwhelmingly originated from just 12 companies, including Verizon. Child sex abuse material is a societal problem, but it is almost entirely manifesting and growing in the ICT sector. We believe that Verizon needs to demonstrate to investors that it is properly assessing the risk to children and itself from this growing threat.

There are a number of leading practices that Verizon’s global peers take advantage of–but where it looks like Verizon does not– to try and shield children from abuse. They start with major efforts to educate users—especially kids — about the risks that await them online. They also include actions like:

  • Conducting research and surveys on how children are at risk while interacting with key products and platforms;
  • Partnering with child experts to do a children’s risk assessment across the business
  • Reporting metrics related to identifying, blocking and taking down child sex imagery. And other innovative approaches.

We asked Verizon to show us how they were assessing their own effectiveness internally in dealing with this issue. The company could not provide metrics, nor goals nor objectives. It couldn’t provide information on how the board oversaw or understood this risk. It couldn’t provide evidence that its initiatives were enterprise-wide and consistently applied.

The company has also faced recent global controversy around child sex abuse content on its Tumblr platform. Media reports noted users complaining for years that child sex imagery was being distributed on Tumblr.

The filers believe that failure to substantially tackle this growing risk to children may pose regulatory and litigation risk, and clearly brand risk, and in turn, hinder the company’s strategies for growth. We also believe that our new CEO, Mr. Vestberg, is uniquely placed on several external boards—including the World Childhood Foundation—where he can bring experts to the table to make a real difference on this threat.

We ask shareholders to support Item 6, and we ask Verizon to show leadership on an issue critical to the safety of future Verizon customers.