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Jason McELweenie
The discontent of investors has never been so high since the social network was launched back in 2012. Over the past year, they have seen a series of scandals with the company - from possible interference in US elections to the incident with Cambridge Analytica.
The shareholders blame Zuckerberg for these misfortunes. In their opinion, the problems are still not solved because the very structure of Facebook makes its chairman and CEO almost untouchable.
The investors are determined to drastically change the company’s management. Each of them offers their own options, but there are two points on which they have managed to reach full agreement.
First, they want Zuckerberg to step down as chairman. An independent manager should take his chair instead. Then, they are planning to stop issuing shares of two classes, since preferred shares in the hands of Mark Zuckerberg and his closest managers give them too much power.
Privileged class B shares give 10 times more votes than Class A shares. Zuckerberg owns over 75% of B shares, which gives him more than half of all the votes in the company when making important decisions.
Most independent investors voted in favor of these two proposals at the recent meetings of Facebook shareholders. By the way, they are also becoming tenser. This year at one of the meetings Zuckerberg was called a "dictator". The person who said it was removed from the meeting because she expressed her dissatisfaction aloud.
A Facebook spokesman declined to comment on news about the discontent among investors, citing the company’s recent statements that its management "meets all the requirements." As for Zuckerberg's departure from the post of chairman, the company believes that this step will cause "uncertainty, confusion and inefficiency in the work of the board."
One of investors in Facebook, who poured about $ 35 million in the company, believes that the reason for dismissing Zuckerberg from the chairman's position is quite transparent. "He does not report to anyone, nor to the board, nor to investors, which is a bad corporate practice," he said.
According to him, the head of Facebook is a king of his own castle, which ultimately has a detrimental effect on the company.
Investor Patrick Doherty, who owns shares worth about $ 1 billion, believes that the company's existing management model has long become obsolete.
"The situation where one autocrat runs a huge company worth billions of dollars is an anachronism. This worked in the 19th century, when there were "robber barons", "Doherty said, referring to the capitalist businessmen who made a fortune by dishonest means.
Shareholders are serious, and they are not going to stop, but plan to keep making proposals at meetings, write letters to Facebook’s top managers and actively communicate with media representatives to cover the current situation.
However, experts believe that a new leader of Facebook would be something out of the ordinary.
"If there is another Cambridge Analytica or interference in the elections, then social discontent can reach the point where it will be necessary to change the model of power," Dylan Sage, another Facebook shareholder, said. After the scandal with Cambridge Analytica, when Facebook voluntarily transferred the personal data of millions of its users to a third-party company, Sage sold most of its shares, but still owns the company's assets for $ 2.8 million.
In general, all investors agree in one: they want the company better, even if they have to take drastic measures to do it. In the meantime, experts remind Zuckerberg that no head of even the world's largest company is invulnerable. They are citing the example of the founder of Uber Travis Kalanick, who was forced to leave his post after a string of scandals and unpopular decisions.
source: businessinsider.com
The shareholders blame Zuckerberg for these misfortunes. In their opinion, the problems are still not solved because the very structure of Facebook makes its chairman and CEO almost untouchable.
The investors are determined to drastically change the company’s management. Each of them offers their own options, but there are two points on which they have managed to reach full agreement.
First, they want Zuckerberg to step down as chairman. An independent manager should take his chair instead. Then, they are planning to stop issuing shares of two classes, since preferred shares in the hands of Mark Zuckerberg and his closest managers give them too much power.
Privileged class B shares give 10 times more votes than Class A shares. Zuckerberg owns over 75% of B shares, which gives him more than half of all the votes in the company when making important decisions.
Most independent investors voted in favor of these two proposals at the recent meetings of Facebook shareholders. By the way, they are also becoming tenser. This year at one of the meetings Zuckerberg was called a "dictator". The person who said it was removed from the meeting because she expressed her dissatisfaction aloud.
A Facebook spokesman declined to comment on news about the discontent among investors, citing the company’s recent statements that its management "meets all the requirements." As for Zuckerberg's departure from the post of chairman, the company believes that this step will cause "uncertainty, confusion and inefficiency in the work of the board."
One of investors in Facebook, who poured about $ 35 million in the company, believes that the reason for dismissing Zuckerberg from the chairman's position is quite transparent. "He does not report to anyone, nor to the board, nor to investors, which is a bad corporate practice," he said.
According to him, the head of Facebook is a king of his own castle, which ultimately has a detrimental effect on the company.
Investor Patrick Doherty, who owns shares worth about $ 1 billion, believes that the company's existing management model has long become obsolete.
"The situation where one autocrat runs a huge company worth billions of dollars is an anachronism. This worked in the 19th century, when there were "robber barons", "Doherty said, referring to the capitalist businessmen who made a fortune by dishonest means.
Shareholders are serious, and they are not going to stop, but plan to keep making proposals at meetings, write letters to Facebook’s top managers and actively communicate with media representatives to cover the current situation.
However, experts believe that a new leader of Facebook would be something out of the ordinary.
"If there is another Cambridge Analytica or interference in the elections, then social discontent can reach the point where it will be necessary to change the model of power," Dylan Sage, another Facebook shareholder, said. After the scandal with Cambridge Analytica, when Facebook voluntarily transferred the personal data of millions of its users to a third-party company, Sage sold most of its shares, but still owns the company's assets for $ 2.8 million.
In general, all investors agree in one: they want the company better, even if they have to take drastic measures to do it. In the meantime, experts remind Zuckerberg that no head of even the world's largest company is invulnerable. They are citing the example of the founder of Uber Travis Kalanick, who was forced to leave his post after a string of scandals and unpopular decisions.
source: businessinsider.com
