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Why Facebook investors should vote no on Zuckerberg

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Outside investors in Facebook should vote no on reelecting Mark Zuckerberg to Facebook’s board of directors at May 30th’s annual shareholder meeting.

Zuckerberg has near total control of a company that now plays a significant role in American and global public life. But given the company’s massive size and recent record of mistakes, responsibility for change can’t be left to him alone. A no vote by a majority of outside shareholders, while it cannot at this time directly oust Zuckerberg, is the signal needed to trigger regulator intervention and internal pressure for reform. For both good corporate governance and the stability of American society, Facebook must change.

First, investors should vote no because effective governance is important for long-term value and Zuckerberg’s unilateral control is an affront to those practices. The founder holds both the CEO and chair roles, serving as his own boss with inadequate checks on his authority and a board that is unable to exercise real oversight. He has further consolidated control after disputes over data privacy reportedly contributed to the departure of the founders of WhatsApp and Instagram, as well as Facebook’s long-serving chief product officer. Facebook’s dual-class share structure gives Zuckerberg 10 votes instead of 1 for most of his shares, giving him nearly 60 percent of........

© Fast Company