Lyft chair Logan Green 'bears particular responsibility' for driver-safety concerns, say shareholders opposing his re-election

By Levi Sumagaysay

SOC Investment Group cited research that found ride-hailing drivers feel unsafe while working and experience verbal abuse, physical assault and robbery

A shareholder group is asking fellow Lyft investors to vote against the re-election of board chair Logan Green, citing driver-safety concerns.

Green, the ride-hailing company's co-founder and former chief executive, "bears particular responsibility for failing to properly address mounting concern over rideshare driver safety," SOC Investment Group said in a filing with the Securities and Exchange Commission this week.

The group, which works with pension funds sponsored by unions affiliated with the Strategic Organizing Center, cited research reports that have found ride-hailing drivers feel unsafe while working and experience verbal abuse, physical assault and robbery. It also mentioned other reports about drivers being carjacked or murdered on the job.

The group also said that Lyft (LYFT) had not issued updated information about driver safety since 2019, though it pointed to the most recent safety data submitted by the company to the California Public Utilities Commission, as required. The group said that report of 9,959 California assault or harassment cases in fiscal year 2021 was inconsistent with Lyft's 2021 community safety report, which included a much lower number nationally: 4,158 sexual assaults in the U.S. from 2017 to 2019.

"Either safety problems have increased substantially, or inconsistent definitions are making comparisons difficult, indicating the importance of ongoing, annual updates to Lyft's driver safety disclosure," SOC Investment Group wrote.

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The group added that it is concerned that Lyft's policies of suspending or deactivating drivers and its pay practices "may be penalizing drivers who attempt to protect themselves by declining rides from customers they perceive as threats."

SOC Investment Group said it sent the board's lead independent director, Sean Aggarwal, a letter in April to ask the board to address driver safety and to adopt governance reforms, such as yearly director elections and a one-share-one-vote structure. In a response seen by MarketWatch, head of investor relations Sonya Banerjee said in an email that driver and rider safety is a "critical focal point" for new Lyft CEO David Risher. SOC Investment Group did not find Lyft's response adequate or specific enough.

A Lyft spokesperson sent the following response Tuesday: "[CEO Risher] signed up to drive on the platform before he became CEO to better understand the holistic driver experience. And he has made it clear that driver and rider safety continue to be paramount issues." The spokesperson declined to provide any additional response regarding the shareholder group's claims about Green.

As Lyft's stock has cratered, Green was replaced as CEO of the company in late March. Co-founder and president John Zimmer is also stepping away from day-to-day company operations, but remains on the board as well.

Lyft's annual general meeting is scheduled for June 15.

The investor concern over driver safety at Lyft follows similar concerns at ride-hailing giant Uber (UBER). Investors at Uber recently rejected two proposals, one of which was a shareholder proposal calling for an independent audit of driver safety and health. The other proposal, which was presented on the floor at Uber's annual general meeting, called for a more transparent process for driver deactivations, the threat of which drivers said can put them at risk.

Related:Uber drivers say they're 'totally dependent' on their income -- but risk being deactivated at any time

-Levi Sumagaysay

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05-17-23 1103ET

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