The recent privacy and security woes, as well as the calls for greater regulation of Facebook in light of the Cambridge Analytica scandal, have led to an embarrassing situation for Facebook Chairman and CEO Mark Zuckerberg. A set of key Facebook investors and shareholders, including four major United States-based public funds that hold shares in Facebook, have called for Mark Zuckerberg to step down as chairman of the board of directors of Facebook. A proposal to have him removed from the post has been filed, which will be put to vote at the next Facebook shareholder meeting, which is to take place next year.
The move is largely symbolic and is unlikely to succeed, given that Mark Zuckerberg himself holds absolute control of the board of directors, and the shareholders that are proposing his removal do not have the voting power to have him removed. However, these demands are aimed more towards having him step down voluntarily and hand over the position of chairman to an independent candidate capable of overseeing the activities of the board. Having founded Facebook, Mark Zuckerberg is unlikely to cede any control over his company, especially to outsiders.
The investors involved in this resolution are largely the representatives of four major US public funds, including New York City’s $160 billion pension fund. Given that these are public funds that support social and public causes and purposes (such as the payment of pensions to New York City government employees), there would be a need to protect these investments. In the face of security and privacy scandals, these investors are pushing for greater oversight on Facebook, starting with its board of directors.
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A similar proposal was floated in 2017, but failed due to the effective control held by Mark Zuckerberg over the board. The founder of Facebook holds the positions of CEO of the company as well as chairman of the board, thereby retaining both operational as well as corporate control over all decisions at Facebook. Zuckerberg founded Facebook in 2004, and has built it into one of the most profitable companies in the world, with his own personal fortune valued at well over $60 billion.