On Monday, September 13, Green Century Capital Management°, PIRG's affiliated socially responsible mutual fund company, announced that it had filed resolutions with both John Deere and Apple calling for an account on the companies’ “anti-competitive repair policies.”
The resolutions represent an increase in pressure on both companies to resolve the way in which they restrict certain repairs to their “authorized” repair shops with proprietary repair materials.
“Investors are extremely concerned about Apple’s disingenuous combination of promoting environmental sustainability while inhibiting product repair,” said Green Century President Leslie Samuelrich. Regarding Deere, Samuelrich explained: “Depriving farmers of the ability to fix their machinery runs counter to the ethos founder John Deere surely set for this iconic brand. Now, for the betterment of the company and all Americans, it must stop.”
Just let us fix stuff
It’s common sense: When things break, you fix them or take them to your preferred repair shop. But when only the manufacturer has the ability to repair something -- whether it be a tablet or a tractor -- they can charge us whatever for their work. They can also push us into buying a brand new product altogether, adding to our waste problems.
That’s why U.S. PIRG is pressing for Right to Repair reforms, which require manufacturers to provide access to what we need to fix modern equipment such as diagnostic software, spare parts and service documentation.
These reforms have been met with full-throated opposition from major manufacturers, including John Deere and Apple, which have been two of the most prominent opponents. But despite the avalanche of lobbying against Right to Repair, pressure has been mounting for change.
President Joe Biden issued an executive order calling for action to stop repair restrictions, and specifically named farm equipment and smartphones as areas to target enforcement. The Federal Trade Commission (FTC) has also signaled it will begin enforcing violations to antitrust laws regarding repair. Meanwhile, 27 states and the U.S. Congress have introduced legislation so far in 2021.
Frankly, it is no surprise that shareholders in Deere and Apple are wondering whether these companies’ stances are inviting trouble and risk for shareholders.
Deere probed about its double-talk on repair
Shareholders are raising questions about how the companies have attempted to spin their approach to repair.
Both corporations make their products in such a way that requires the use of proprietary tools to conduct many repairs. For example, John Deere equipment repair might require a calibration process to finalize installation of a spare part. This function is limited to software tools only available to dealerships.
Green Century Capital Management notes that Deere “representatives are quick to point out that less than 2% of all repairs require a software update.” However, shareholders are assuming big-time risks -- the risk of new regulation, antitrust enforcement and permanent brand damage -- for what the company insists is a tiny portion of repairs. Why not just find a resolution to those 2% of repairs and avoid all this trouble?
“Deere’s approach flies in the face of the ingenuity and self-reliance that are at the heart of America’s great agricultural tradition,” says Green Century’s Samuelrich.
Apple repair stance undermines environmental record
Apple has ambitious climate and environmental goals and is often lauded for leadership on issues of sustainability. That said, its stance on repair, especially the company’s very prominent anti-Right to Repair lobbying, has damaged Apple’s environmental reputation.
In their news release, Samuelrich notes: “The company risks losing its reputation as a climate leader if it does not cease its anti-repair practices.”
The release also points out the stakes of undermining repair: “Electronic waste is the world’s fastest growing waste stream, and by 2040 internet-connected devices will account for 14% of all greenhouse gas emissions. Access to product repair is critical for extending the lifespan of electronic devices, thereby preventing wasted resources and reducing emissions … Green Century will press Apple to reverse its anti-repair practices in order to mitigate regulatory and reputational risks and bolster the company’s ambitious climate commitments.”
As support for Right to Repair continues to grow -- from coast to coast and even in the White House -- it forces people to ask these companies: Why are you so against allowing people to fix their stuff?
After all, it’s common sense. It saves money, protects farmers' livelihood, cuts pollution and electronic waste. Perhaps it’s time these companies realized this isn’t going away and they must finally let people fix their stuff.
U.S. PIRG is not a registered investment adviser. U.S. PIRG is not providing any investment advice to any recipient of this communication.
About Green Century Capital Management
°Green Century Capital Management, Inc. (Green Century) is the investment advisor to the Green Century Funds (The Funds). The Green Century Funds are the first family of fossil fuel free, responsible, and diversified mutual funds in the United States. Green Century Capital Management hosts an award-winning and in-house shareholder advocacy program and is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations.
*As of June 30, 2021, Apple Inc. and Deere & Co. comprised 3.71%, 0.00% and 0.00% and 0.77%, 0.55% and 0.00% of the Green Century Balanced Fund, the Green Century Equity Fund and the Green Century International Index Fund, respectively. As of the same date, other securities mentioned were not held in the portfolios of any of the Green Century Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.
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