BlackRock cited workers' accounts of working and living conditions, the firing of the whistleblower and the virus cluster at Top Glove in its criticism of the board. It also voted against re-electing six board members at Top Glove's annual general meeting on Wednesday.
"We view the board's ineffectiveness in COVID-19 mitigation and inadequate oversight of worker health and safety issues as especially egregious with potentially serious implications for its reputation as a supplier of such equipment to hospitals around the world," BlackRock said in a statement late on Wednesday.
Top Glove did not immediately respond to a request for comment. The company has acknowledged that much more needs to be done to raise the standard of employee welfare and has promised to rectify shortcomings quickly.
A BlackRock unit, BlackRock Institutional Trust Co, is the tenth biggest shareholder in Top Glove, holding 1.07% of its shares.
The U.S. firm said it intended to hold other incumbent directors accountable by voting against their re-election at future meetings.
An influential Norwegian sovereign wealth fund, managed by Norges Bank Investment Management (NBIM), also voted against their re-election, according to voting records published by NBIM on its website.
The fund, which owns 0.84% of Top Glove shares, declined to comment on worker safety concerns.
The board members were re-elected despite the objections.
BlackRock's comments were the first public criticism of Top Glove from an investor since the virus outbreak among workers.
The company posted record profits last year as demand for its gloves soared due to the pandemic. Its share price more than tripled in 2020.
In July, the United States banned two units of Top Glove over forced labour allegations. Malaysian authorities plan to charge the company over poor worker accommodation.
BlackRock said the living conditions described by the workers, U.S. and Malaysian authorities were in "stark contrast" to what the board conveyed to shareholders.
Top Glove's factories, some of which were closed due to the virus outbreak, reopened last month.
(Reporting by Liz Lee and A. Ananthalakshmi; Editing by Robert Birsel)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.