FFC continues to pressure Texas Instruments on the use of their products in Russian Weaponry

June 20, 2024

Friends Fiduciary filed a shareholder proposal this proxy season requesting Texas Instruments commission an independent third-party report on the company’s due diligence process, to determine whether customers’ misuse of its products expose the company to human rights and other material risks. FFC filed this proposal for the second year in a row out of continued concern over TI products being misused by sanctioned entities.

Texas Instruments’ dual use products continue to be found in Russian weaponry recovered in Ukraine and in close proximity to war crimes. The use of dual use components in electronic warfare is a semiconductor industry-wide issue. While TI’s peers have taken steps to help combat the illicit use of their products, we believe TI’s current governance, policies, and procedures focused on sanctions and export control compliance are not sufficient for shareholders to assess current and future risks. TI’s products are the second-most-recovered foreign components on the battlefield in Ukraine, out of all foreign manufacturers. Heightened human rights and know your customer due diligence would better equip Texas instruments in identifying gaps in its current policies and practices on the downstream end use of its products.

Our proposal was voted on at TI’s 2024 Annual General Meeting and received a 19% vote in support from fellow investors who share our concerns. This remains a strong vote from investors, and we intend to continue to engage the company on these concerns not only due to our Quaker testimony of peace, but also as long term investors looking for the company to mitigate reputational, regulatory and legal risk.

Our letter to shareholders in support of the proposal can be found here.

In addition, the institutional proxy service, ISS, socially responsible investment policy recommended support for the proposal. Here is their analysis.