The Facebook Shareholders Revolt of 2019
68% of Facebook investors voted to oust Zuckerberg as chairman
Investors and shareholders increasingly are unsatisfied with Mark Zuckerberg and his role as CEO, head of the board and having a complete monopoly over voting.
Trillium Asset Management, which owns nearly $7 million in Facebook shares, filed the proposal, arguing that having one person as both CEO and chairman allowed for the social media giant’s slew of recent mishaps.
I have to agree with this, Facebook isn’t just a dangerous monopoly of the Western internet, but one person having too much control over it is a liability to the public. And no Facebook’s Globalcoin/Project Libra isn’t going after the U.S. dollar.
Facebook isn’t just controversial, it’s likely an antitrust offender and the DOJ probe, I think, will find and back that up.
Shareholders are Getting Frustrated at Bad Leadership
Given the lack of great leadership at Facebook, in 2019 Shareholders not named Mark Zuckerberg want him out as Facebook’s chairman. That’s a depiction of how Wall Street and Capitalism doesn’t always work in the public’s favor, CEOs just have too much power to the point of Silicon Valley being hijacked by a few elites.
More than 67 percent of independent Facebook shareholders voted to install an independent chair at Facebook, representing a significant vote against the current leadership. What are you going to say, that shareholders and investors of Facebook are wrong and the guy at the top is right? Consensus really does matter in business.
A Majority Without a Voice
Likewise, more than 80% voted to eliminate the class of shares — held by Zuckerberg — that carry 10 times the voting power of regular shares. This is inequality at the top of a BigTech company that’s pretty unconstitutional. Can you imagine the kind of power hungry attitude you must have to maintain this level of control? It’s beyond belief.
In 2017, only 51% of that group voted in favor of the the same proposal. Momentum is clearly not in the CEO’s favor, and rather like Uber’s former CEO, it’s taking him a long time to realize the inevitable. The longer he delays, the more it’s hurting his company. Leadership really matters if you want to scale and sustain your business, and we all know Facebook cut corners to grow this big. However, it takes a different kind of leadership to elevate your product and regain the public’s trust.
Facebook Could Use a New CEO
Mark Zuckerberg simply is no longer the right man for the job. However in this regard, his opinion is the only one that truly matters at his company. He’s more or less a BigTech tyranny in 2019, or the last fifteen years. He’s the Facebook king, without dispute as lieutenants have left him. He’s even chased out some of his best people with his decisions for the company.
New York City Comptroller Scott Stringer, who oversees a city pension fund that holds Facebook shares, on Tuesday June 4th, 2019 repeated a call to remove Zuckerberg as chairman.
Mark and his boys’ club essentially have effective control of the company with a 58% voting stake.
Evasion and Executive Exodus
Natasha Lamb, managing partner for the activist investment firm Arjuna, asked Zuckerberg at the meeting whether he would be willing to step down as chairman. He evaded the question. He’s very talented at doing that, as we saw when he was questioned at Congress. And it shows Silicon Valley is corrupt at the human layer, at the human level. Greed and attachment is a powerful motivator not to do the right thing.
“Facebook’s independent investors agree that it’s time for the company to separate the Board Chair and CEO roles,” Michael Frerichs, treasurer for the state of Illinois, which invests in Facebook, said in a statement. ”Right now, Mr. Zuckerberg is both Board Chair and CEO, serving as his own boss, and clearly it’s not working.”
Legal Liability of CEOs should be Changed Due to Facebook Case
If this continues he could come under some kind of legal issue for all the violations Facebook has caused. CEOs are not accountable enough for the actions of their companies and I think Millennials realize this. It’s one of the things about Capitalism that doesn’t really work in the best interests of the public good.
Holding on to power doesn’t make you wise or smart. Investors would like to see Facebook make a different kind of hire instead. Facebook needs more independent regulation, and while Facebook is bundling its Chat into a single connected domain, this is exactly the thing that’s going to invite more scrutiny not less and seems like an epic failure of timing compared to the probes that it will be getting in 2020.
However, Mark Zuckerberg has a stellar track record for growing his business and squeezing ad-dollars from brands and companies with the best targeting and “only game in town” type monopoly in digital advertising. Not like anybody cares about impressions on Instagram or ads in its stories. Facebook is vulnerable since it relies too much on digital advertising, and could be displaced by the likes of Amazon.
Facebook has mostly chosen profitability over innovation, and while it has an impressive consumer base with a wide reach for Facebook, WhatsApp and Instagram, it’s brand is damaged, possibly beyond repair.
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