Amidst growing series of scandals, data breach allegations, and Cambridge Analytica disaster, social media company Facebook is facing investor’s fury where investors are growing increasingly restless on how Facebook is run, demanding radical changes.
According to Business Insider’s conversation with six prominent shareholders, it is clear that investors have become rebellious over company’s corporate governance structure which hands Mark Zuckerberg the sole power as both CEO and Chairman.
New York City Comptroller Scott Stringer, who oversees around $895 million of Facebook shares through city pension funds said, “We have concerns about the structure of the board that the company doesn’t seem ready to address, which can lead to risks – reputational, regulatory, and otherwise.”
While investors are openly asking for radical changes on many fronts, two major issues have repeatedly come forward in open where investors are demanding the following:
- They want Mark Zuckerberg to step down as chairman and another independent executive to be hired at his place.
- Secondly, Investors also want a termination of Facebook’s dual-class share structure as they believe it concentrates too much power in hands of CEO and his top team.
A majority of independent shareholders have voted in favour of proposals to achieve these aims at Facebook’s past two investor meetings.
Moreover, as per inside sources investors boiled in anger over past two investors meeting where Zuckerberg was accused of running the company like a “dictatorship,” while another shareholder was thrown out of the event for venting her displeasure.
Meanwhile, some investors have also approached Facebook’s audit committee to intervene. Facebook has declined to comment on investors unrest.
Earlier too Facebook Inc shareholders had approved a proposal to create a new class of non-voting shares, a move that was aimed at letting Chief Executive Officer Mark Zuckerberg give away his wealth without relinquishing control of the social media company he founded.
However, the recent investor’s fury seems to blown out and times ahead will only reveal how Facebook will handle such turmoils within and whether it will come out clean or will eventually lose its power in the social media landscape.