The following letter has been sent via email and registered mail to Etsy Inc.’s Board of Directors. To download a PDF copy that can be sent to the Etsy board please click here or write your own and mail it to: Etsy, Inc 117 Adams Street Brooklyn, NY 11201 ATTN: Attention: Board of Directors of Etsy, Inc. Chairman of the Board: Fred Wilson, Chief Executive Officer: Josh Silverman, Members: Gary Briggs, M. Michele Burns, Edith Cooper, Jonathan D. Klein, Melissa Reiff, Margaret “Peggy” Smyth
July 16, 2018
Attention: Board of Directors of Etsy, Inc.
Chairman of the Board: Fred Wilson, Chief Executive Officer: Josh Silverman, Members: Gary Briggs, M. Michele Burns, Edith Cooper, Jonathan D. Klein, Melissa Reiff, Margaret “Peggy” Smyth
Etsy, Inc
117 Adams Street
Brooklyn, NY 11201, USA
Dear Board members,
Recent shareholder actions have resulted in radical changes to values at Etsy including the replacement of Etsy CEO Chad Dickerson, layoffs and corporate restructuring, the termination of B-Corp Certification, values-aligned programs, and commitments to socially responsible business practices. In response community stakeholders and members of Etsy’s global community call on you to recommit to core values and the Etsy community. As the mandate of the Board of Director’s clearly states that“Etsy’s management and board are guided by our mission and core values. They recognize that the long-term interests of stockholders are advanced by responsibly addressing the concerns of Etsy’s global community, the localities we serve, and the public and planet at large” a timely and thoughtful response to these concerns is expected.
Please take a moment to read statements submitted by the community about why changes to values at Etsy matter to them: http://bit.ly/2LjWRuR
Due to changes in values at Etsy concerned community stakeholders have called for a day of action on July 16, 2018 the day Etsy’s new tiered plans and rate increases go into effect. This action is not in retaliation for the increase in fees but in response to radical values and culture change at Etsy. For the purpose of this action “stakeholder” is used as defined by B-Lab’s criteria for B-Corp Certification to include employees, the community, the environment, suppliers, customers, and shareholders.
The primary concerns and reasons for organizing a stakeholder action are as follows:
- Lapse of Etsy’s B-Corp certification, termination of values-aligned programs, and mass layoffs of staff responsible for social projects has resulted in a loss of trust and respect for Etsy’s claims to be a socially responsible company.
- As one of the first B-Corp certified companies to go public Etsy made repeated vocal commitments to socially responsible business practices and are accountable to the shared values that made community stakeholders willing to support the company as it scaled.
- The values that generated media attention, built public trust, and grew awareness of Etsy in order for it to achieve success were based on “business as unusual”. Major changes to Etsy’s core values undermine public trust in social enterprise and set precedent for other B-Corporations to not follow through on commitments.
- Despite continuing to use the language of a socially responsible business throughout the site Etsy no longer has a corresponding commitment to measuring those values and has published no progress reports since 2016 prior to the changes in CEO, mission, and lapse of B-Corp status.
- Etsy’s decision to prioritize shareholder value over community stakeholders and the resulting change of mission from the specific goal to “reimagine commerce in ways that build a more fulfilling and lasting world” to the three word “Keep Commerce Human” along with replacement of clear language, objectives, and programs to measure social and economic impact with vague terms show a lack of respect for commitments.
- Recent changes to Etsy’s values and culture are in opposition to what led to Etsy’s success and differentiated the company from retailers such as Amazon or eBay by providing a trusted source for ‘thoughtful consumers’ to purchase from independent sellers while democratizing access to business for millions of entrepreneurs.
- Lack of transparency and accountability around terminated projects including: Etsy Wholesale; Etsy Studio; Etsy Maker Cities; plans for a seller health insurance program; the creation of an Indigenous Seller Handbook and policies to support Indigenous artists; the Etsy Advocacy team and other values based projects does not align with the ongoing promise to “build for the long term” or consideration for the “thoughtful consumers” and community stakeholders who contributed to these initiatives and overall company success.
- Concern about Etsy exploiting marginalized/underrepresented groups Etsy has targeted to achieve social impact goals – unlike freelancers who have formed a Freelancers Union to speak on behalf of their 57 million members, Etsy’s 2 million sellers are primarily women and do not possess unions, global trade organizations, or advocacy groups to represent their interests collectively.
The goal of this action is to:
- Bring forward concerns and a critical response to changes in values at Etsy to current shareholders and community stakeholders with the goal of negotiating a recommitment to core values and a meaningful response to concerns.
- Inform consumers of changes in values at Etsy so they can make thoughtful choices about whether to support the company as a shopper or seller or take action.
- Act to hold Etsy accountable to changes in values by uniting concerned individuals and fellow makers in collective action to demonstrate that community stakeholders and consumers are a major force for disrupting business as usual.
- Advocate for proper representation and consultation during decision making and transparency around program termination.
- Encourage consumers to renew personal commitments to reimagining commerce in ways that build a lasting and more fulfilling world by making thoughtful purchases and holding companies accountable to the values they earn trust with.
The Board of Directors is ultimately responsible for core company values and successfully negotiating with both shareholders and stakeholders in order to achieve mutually beneficial outcomes in line with Etsy’s mission and values. Recent and repeated actions have demonstrated a willingness to prioritize shareholder profits over stakeholder communities or good business practices. While no one disputes the company’s right to make a profit , evolve, or adapt to a volatile market that evolution does not require eliminating the values that differentiated Etsy from other online retailers and is a major blow not only to the B-Corp community but all who support the goal of reimagining commerce to build a more lasting and fulfilling world. In CEO Josh Silverman’s February 2018 interview with Bloomberg’s Emily Chang he stated that “the world needs Etsy more than ever” while failing to offer concrete language on how the company will commit to socially responsibly business. It is policy, clear language around mission and values, and adequate representation and inclusion of community stakeholders that is required in order to renew public trust in Etsy.
Public Dialogue
These serious concerns require transparency and constructive dialogue with community stakeholders. Etsy as both a company and former B-Corp made public commitments to social responsibility and it is in the best interests of the company to address stakeholder concerns seriously and respectfully when brought forward. A public acknowledgement of this letter and response to the outlined concerns by Etsy Inc. Board of Directors is requested in a timely manner. As community stakeholders our interests are aligned with the Board and management in building both financial and social value for the benefit of both shareholders and community stakeholders, as well as fulfilling the mandate of the board to “responsibly addressing the concerns of Etsy’s global community, the localities we serve, and the public and planet at large.”
We look forward to hearing from you soon,
#EtsyStrike participants and concerned community stakeholders
Additional links:
Community Statements on Changes to Values at Etsy http://bit.ly/2LjWRuR
#EtsyStrike Begins: http://bit.ly/EtsyStrikeBegins
Call to action http://bit.ly/etsystrike
