Are they actively attempting a hostile takeover and the board thinks that they'll hurt the company? Then I think that'd be legal. Otherwise I don't see how you could make a legally defensible argument around diluting shareholders just because of their beliefs

>seems arbitrary whats considered a "bad actor".

Well, I guess if you’re a moral relativist that might be the case. I mean, why not burn the rest of the planet down for temporary profits? Why not enslave children in the Congo? It benefits the shareholders after all. How about murder and torture for hire? These decisions just seem so arbitrary. *shrug*