Facebook’s shareholders have put a proposal seeking removal of Chief Executive Officer (CEO) Mark Zuckerberg from the board of directors. The shareholders are members of online client watchdog group Sum Of Us, and contest. That a combination of roles as CEO and member of board of directors in a single person ‘weakens a corporation’s governance, which can damage shareholder value’.
A reported in Venture Beat cited Lisa Lindsley, the capital markets advisor for SumOfUs, who told the site a petition requesting Facebook to enhance its corporate citizenship has been signed by 3,33,000 people out of which 1,500 were company’s shareholders. Lindsley, in a statement, said, ““The shares held by 4 individual SumOfUs members enabled us to file this proposal.”
Shareholders want Facebook CEO removed
Zuckerberg, who owns majority of company’s shares, can easily strike down the proposal along with other board members. Plus, Facebook has witnessed a strong growth below Zuckerberg’s leadership because the social media company cruised past Wall Street’s earnings and revenue expectations last week. Financial performance is the least of company’s issues right now, with a quarterly profit of $3.57 billion, more than double the $1.56 billion it reported a year ago.
Facebook has 1.86 billion users using its service monthly as of December 31, up 17 per cent from a year earlier.
Mark Zuckerberg from the board of directors
The Facebook CEO has been a member on the company’s board of directors since 2012. In 2015, the Facebook CEO and wife Priscilla Chan pledged to give 99 per cent of their company’s shares – regarding $45 billion – to advance human potential and promote equality for kids.
Therefore the proposal demands independent leadership citing the increasing criticism against Facebook “regarding its perceived role in the promotion of deceptive news; censorship, hate speech and alleged inconsistencies in the application of Facebook’s community guidelines and content policies; targeting of ad views based on race; collaboration with law enforcement other government agencies”. Hence it calls for “public accountability” regarding the human rights impacts of Facebook’s practices.
Facebook came under the scanner for promoting fake news on its platform in August last year. When a report suspect the company of editorial bias against U.S. conservative news organisations in its Trending Section. Facebook denied the charges, and later removed human editors and switched to a more algorithm-driven system for deciding ‘Trending’ topics.
Since Lindsely said the proposal is informative in nature. And can be place up for voting at the company’s annual investor meeting. “There could be a 99 % vote in favor of it. And also the board wouldn’t be below legal obligation to implement it. However, most competent board members realize that it is unwise to ignore the voice of the shareholders. Whose interests they’re charged with representing,” she told Venture Beat.