Why I think Facebook investors should vote no on Zuckerberg
- Fast Company
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
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 the vote on any issue and allowing him to veto literally anything.
But besides these structural reasons, there is real evidence of failure in Zuckerberg’s leadership.
For years, my organization and others have engaged deeply with Facebook’s leadership in an attempt to address an ongoing pattern of dangerous and racist practices. These have included textbook civil rights violations like job ads on the platform that are hidden from black people. But it also includes incidents like the violation of Korryn Gaines’s civil rights in 2016, when Facebook deactivated Gaines’s livestream at the request of law enforcement shortly before police killed her in front of her son. Both here and internationally, the company’s platforms have become fast and efficient avenues for doxing and for spreading hateful rhetoric, misinformation, and calls to violence against black people, Jews, immigrants, Muslims, LGBT communities, and many others.
These are the same kinds of problems that are now prompting an unprecedented level of regulatory scrutiny from Congress, other national governments, and now the FTC, which we recently learned is going to levy a multibillion-dollar fine on the company. Public confidence in the company has plummeted, with just one in five respondents to a December poll saying they trust Facebook with their data, the lowest of the five major tech companies. Negative media coverage of the company is nearly nonstop. Look here, here, here, here, here and here for some of the dozens of stories that have dropped in the past two months alone.
Our experience in trying to work in good faith with the company to address these issues is strong evidence of the need for new checks on control at the top.