Shopify Inc. shareholders will vote Tuesday on whether the tech company should create an artificial intelligence policy.
The creation of the policy is being pushed by the Shareholder Association for Research and Education on behalf of the United Church of Canada’s pension plan, which is a Shopify investor.
They argue Shopify needs a policy because research has found generative AI systems may negatively impact human rights and agentic AI can cause misinformation, manipulation and erroneous automated transactions.
Shopify’s board, however, says a policy is unnecessary because its contracts and terms of service set clear guardrails on how the company’s and merchant data may be used by AI systems.
The proposal makes Shopify the latest in a growing number of Canadian companies facing shareholder pressure around AI, which firms are increasingly adopting in a bid to improve efficiency and productivity.
At Shopify, the technology is being offered to merchant clients to help them run their businesses and market themselves to customers through AI chatbots like ChatGPT.
Shopify staff have also taken to using AI for coding, product development and performance reviews after CEO Tobi Lutke declared the technology a “fundamental expectation” for his workforce last year.
Given how widely Shopify is using AI, SHARE said a policy around the technology “would assure shareholders that Shopify has sound governance and risk management controls in place.”
Its board encouraged shareholders to vote against the policy, calling the proposal “a solution in search of a problem.”
“It is also entirely dissonant from how Shopify builds, ships, and governs technology. AI is not a risk we manage from a distance. It is core to what we build and how we serve merchants,” the company said in its response to the proposal.
“As with any transformative technology, we understand AI deeply and build responsibly — grounded in real-world use, not a policy document detached from our practices.”
Shareholder proposals seldom succeed and Canadian companies that have faced calls for AI policies have largely been able to thwart the overtures.
Last year, Quebec-based investor rights group le mouvement d’éducation et de défense des actionnaires asked 14 companies, including Canada’s biggest banks, retailer Dollarama Inc. and telecom giant BCE Inc., to sign a voluntary code of conduct the federal government developed to govern AI.
Conversations with at least five companies were fruitful enough that MÉDAC withdrew its proposals.
In the nine instances where the vote went forward, the proposal didn’t succeed. It garnered as much as 17.4 per cent support at TD Bank but as little as 3.68 per cent at engineering firm AtkinsRéalis Group Inc.
When two funds at the BC General Employees’ Union targeted Thomson Reuters Corp. last year with a proposal asking the software firm to amend its AI policy to meet the United Nations human rights principles, it similarly failed. That proposal received 4.87 per cent support.
Companies in this story: (TSX:SHOP)
