Apple faces shareholder pressure over China exposure

Apple is confronting a shareholder campaign seeking a comprehensive audit of the company’s exposure to China, sharpening a debate over supply-chain concentration, intellectual property protection and geopolitical risk as ties between Washington and Beijing remain strained. The proposal, scheduled for consideration at Apple’s annual meeting set for February 2026, has been filed by a coalition led by the National Legal and Policy Center, which argues that the company’s disclosures do not adequately capture the scale of potential disruption facing its operations.

The initiative calls for an independent assessment of how developments in China could affect Apple’s manufacturing base, market access and technology assets. Proponents point to the company’s long reliance on Chinese assembly partners, the scale of sales generated in the mainland and the policy tools available to authorities in Beijing as reasons for deeper scrutiny. They say a formal audit would help investors gauge whether Apple is sufficiently insulated from trade restrictions, export controls, data security demands or retaliatory measures linked to broader diplomatic disputes.

Apple’s board has urged shareholders to vote against the proposal, maintaining that the company already provides extensive risk disclosures and actively manages its global footprint. In a statement circulated to investors, directors contend that additional reporting would duplicate existing processes, impose unnecessary costs and risk revealing sensitive commercial information. The board also stresses that Apple has taken steps to diversify manufacturing and strengthen compliance systems without compromising product quality or delivery timelines.

At the centre of the push is concern about concentration risk. While Apple has expanded assembly capacity in countries such as Vietnam and India, China remains pivotal for high-volume production and a dense ecosystem of suppliers. Shareholder advocates argue that even incremental policy shifts in Beijing could have outsized effects, from customs delays to regulatory reviews, and that investors deserve a clearer picture of contingency planning. They also cite intellectual property risks, noting that advanced manufacturing know-how and proprietary designs are deeply embedded in cross-border partnerships.

The proposal reflects a broader trend among multinational investors pressing boards to quantify geopolitical exposure with the same rigour applied to climate or cyber risks. Asset managers and governance specialists say the line between operational resilience and national security policy has blurred, especially for technology firms whose products sit at the intersection of consumer markets and strategic competition. For Apple, which derives a significant share of revenue from Greater China, the debate carries reputational as well as financial implications.

Company executives have repeatedly said Apple’s scale gives it leverage to navigate regulatory environments and that its supplier code of conduct and security protocols mitigate many of the cited threats. They point to years of experience managing trade disputes, including tariffs and export controls, and to ongoing investments in supply-chain mapping and dual sourcing. Management also emphasises that China remains a critical market for innovation and consumer demand, and that engagement there is essential to long-term growth.

Still, the shareholder motion has drawn attention beyond Apple’s investor base. Corporate advisers note that a vote in favour, even if non-binding, could encourage similar actions at other firms with heavy exposure to China. Technology, automotive and pharmaceutical groups have all faced questions from shareholders about resilience planning as governments expand screening of foreign investment and tighten technology transfer rules. A strong showing for the proposal could accelerate board-level reviews across sectors.