Dethroning Facebook’s Mark Zuckerberg – The Wall Street Journal

DUBLIN – Various large public funds in the US are moving to have Mark Zuckerberg removed as Facebook chairman. They want an independent chair who can oversee and perhaps moderate Zuckerberg's actions while he continues in his role as CEO. This has echoes of the SEC's recent deal with Tesla, which requires the company to split the roles of chairman and CEO, both of which are currently held by Elon Musk. It seems that investors and regulators are slowly awakening to some of the risks that face exponential growth tech companies like Facebook and, to a lesser extent, Tesla. Facebook has been in the public eye over the last few years for the mismanagement of a number of private data issues and for its role in the spread of fake news and foreign propaganda in US elections. Shareholders are now hoping to bring in new a new leader who can help the company better navigate the increasingly complex legal and regulatory environment it operates in. Similarly, at Tesla, regulators hope that splitting the roles of chair and CEO will help insulate the company from the volatile behaviour of the man at the top. It's a small change, but a noteworthy one. After ten years' of doing as they like, the tech geniuses are being asked to report to some responsible adults. – Felicity Duncan.Funds Back Proposal to Remove Zuckerberg as Facebook Chairman.By Deepa Seetharaman.(The Wall Street Journal) Several public funds with holdings in Facebook Inc., including New York City's pension funds, are backing a shareholder proposal to push out Chief Executive Mark Zuckerberg as chairman of the social-media giant's board of directors..___STEADY_PAYWALL___.The state treasurers of Rhode Island, Illinois and Pennsylvania, as well as the New York City comptroller are joining the shareholder proposal previously filed by Trillium Asset Management in June, the officials said in a release on Wednesday..The announcement has no practical effect on Mr Zuckerberg and his position as both CEO and chairman because he has a lock on the bulk of Facebook's supervoting shares, each of which gives him 10 times the votes of average shareholders. According to Facebook's latest proxy, his share of the voting power among Facebook investors was 59.9%..Still, the news heightens scrutiny of the company's corporate governance after a string of missteps and controversies, and reflects a view among some investors that Mr Zuckerberg needs additional support guiding the company..Trillium's proposal called on Mr Zuckerberg to relinquish his role as chairman given Facebook's mishandling of several controversies that have enveloped the company in recent years, including the spread of misinformation on the platform and its role in promoting violence in countries like Myanmar. Most recently, Facebook revealed a data breach that hurt 30 million accounts.."An independent board chair is essential to moving Facebook forward from this mess, and to re-establish trust with Americans and investors alike," said New York City Comptroller Scott Stringer in a statement..A Facebook spokeswoman declined to comment..Mr Stringer oversees the city's more than $195 billion pension fund, including 4.7 million shares in Facebook as of the end of March 31. Those shares are currently valued at more than $745 million. The three states supporting the measure have smaller stakes, combining for about 200,000 shares valued at around $32 million. Facebook overall is worth nearly $460 billion..Facebook shares are down about 27% since July, when the company projected weaker-than-expected revenue growth. Several key executives, including the co-founders of Instagram and WhatsApp, have left the company following tussles with Mr Zuckerberg and other senior Facebook leaders..A similar proposal to split Facebook's chairman and CEO roles has gained support from outside investors in the past. In 2017, slightly more than 50% of votes cast favored splitting the roles, after excluding the shares held by 13 executives and board members, including Mr Zuckerberg, the release on Wednesday said..The proposal will next be put to a vote at the company's shareholder meeting in May 2019..Write to Deepa Seetharaman at Deepa.Seetharaman@wsj.com

Dethroning Facebook’s Mark Zuckerberg – The Wall Street Journal

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