Facebook is pressurized by a group of shareholders to replace the existing board chair with an independent entity. The group of people belongs to SumOfUS, an online community which is into managing campaigns against huge corporations for issues like human rights, change in climatic conditions, and much more.
The shareholders from SumOfUs has put forward an official proposal stating that they believe, CEO and board chair should be taken care of two individuals instead of one. They stated in the proposal ‘We believe the combination of these two roles in a single person weakens a corporation’s governance, which can harm shareholder value’.
Till now, Facebook is not commenting on the proposal. But sources believe that they will be issuing a statement when they will file a proxy filing within the next two months. Lisa Lindsley, the Capital Markets Advisor (consultant) for SumOfUs came forward with the figures which show that around 3,33,000 people signed the petition. This petition requests Facebook to improve their corporation governance. She said, “The shares held by four individual SumOfUs members enabled us to file this proposal”.
Facebook’s CEO and board chairperson, Mark Zuckerberg can easily strike down this proposal as he is the person who owns most of the shares of Facebook. To be exact, the largest share of Facebook is under Mark only. There are other people who think to have the founder of the company as the chairperson is beneficial for the company. The latest earning results presented by Wall Street shows that the stock market of Facebook continues to go up which is in favor of the company.
Lindsley also said that ‘they might get 99 percent of people in their favor though the board is not under any legal obligation to do so. But most of the board members think that it is not good to ignore the voice of their shareholders’. Let’s wait for what would be the reaction of Mark Zuckerberg and Facebook.
Tiru Dehariya
