New bid to oust Zuckerberg from Facebook in the works

Galtero Lara
Abril 15, 2019

In a Securities and Exchange Commission filing from Friday, the company listed the various proposals that will be tabled during the May 30th annual shareholding meeting.

Among eight stockholder proposals, one is titled "Stockholder Proposal Regarding an Independent Chair" and makes the case for Zuckerberg to be dethroned as chairman of the board, with an independent executive hired in his place.

"We believe that Mr. Zuckerberg's role puts him in a unique position: he is synonymous with Facebook and, as a result, negative sentiment regarding our company is directly associated with, and often transferred to, Mr. Zuckerberg", the company claims in the SEC filings, which covered the year ending December 31, 2018. The chance of it becoming a reality is extremely slim.

The issue stems from Facebook's dual-class share structure - they allow their Class B shares to have 10 times the voting power of their Class A shares.

"We believe this weakens Facebook's governance and oversight of management", they continue, adding that this has resulted in the company "missing, or mishandling, a number of severe controversies" including Cambridge Analytica's access to user data and the "proliferation of fake news".

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Noting that other tech giants, like Google, Microsoft, Apple, Oracle, and Twitter have separate CEO and chairperson roles, the proposal also points out that Facebook rejected a the similar request earlier and ignored non-insider shareholders' signals in 2017.

The other stockholder proposals include readjusting the company's share structure and the voting rights of shareholders, and compelling Facebook to provide greater insight into the company's gender pay gap.

Zuckerberg owns 75 percent of Facebook's Class B stock, giving him more than half of the voting power in any decision, giving him complete effective control of the company.

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