Shareholders of social media company Facebook has proposed to remove the current CEO Mark Zuckerberg as Chairman citing the several high-profile scandals. The shareholders are also expecting to gain support from larger asset managers.
According to Reuters, several public funds withhold shares in the website officially backed a proposal that would make the role of chairman an independent position, similar to tech giants like Apple, Microsoft, and Google. Hedge fund Trillium Asset Management proposed a similar move back in June but was ultimately voted down. At the time, Facebook insisted that an independent chairman “cause uncertainty, confusion, and inefficiency in board and management function and relations.”
On Wednesday, October 17th, Scott Stringer, Comptroller of New York City has co-filed the proposal along with state treasurers from Illinois, Rhode Island, and Pennsylvania. The proposal accuses that Mark Zuckerberg has mishandled the company scandals, which also includes major security breaches and the spread of misinformation by political groups.
In a statement, Stringer mentioned that the social media company plays an outsized role in the economy and society.
In the statement, he pointed out that the company has a social and financial responsibility to be transparent—that’s why alongside with other treasures he is demanding independence and accountability in the boardroom of the organization.
“We need Facebook’s insular boardroom to make a serious commitment to addressing real risks—reputational, regulatory, and the risk to our democracy—that impact the company, its shareowners, and ultimately the hard-earned pensions of thousands of New York City workers. An independent board chair is essential to moving Facebook forward from this mess, and to re-establish trust with Americans and investors alike,” he added.
The latest proposal will be voted on during a shareholder meeting in May 2019. A similar proposal has been rolled out in February 2017, but no action has been taken yet.
Image Source- FE