Facebook’s Mark Zuckerberg under pressure from shareholders
30 Jul 2018
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Facebook founder, chairman and CEO Mark Zuckerberg, who has started feeling the pressure with lawsuits being filed against him, is also being asked to quit the top post by shareholders.
Trillium Asset Management, an activist investor – which has invested about $10 million in Facebook – has sought Zucerkberg’s removal.
“A CEO who also serves as chair can exert excessive influence on the board and its agenda, weakening the board's oversight of management,” said the firm in its proposal. “Separating the chair and CEO positions reduces this conflict, and an independent chair provides the clearest separation of power between the CEO and the rest of the board.”
Lack of managerial oversight resulted in ‘missing’ or ‘mishandling’ several controversies including the Cambridge Analytica scandal, besides the increasing number of ‘fake news’ items.
Worried over the deepening crisis confronting the company, shareholders have been dumping its scrips. Last week, Facebook shares plunged by 20 per cent after the company reported its slowest user growth in two years. Its stock market valuation plunged by a hefty $120 billion, the worst single-day loss in market value in US stock history.
Zuckerberg lost a whopping $15.1 billion during the first five minutes of trading on Thursday and his ranking in the Bloomberg Billionaires Index fell by three points.
On Friday, James Kacouris, another shareholder, filed a complaint in the Manhattan federal court, accusing Facebook, Zuckerberg and the chief financial officer of making misleading statements about revenue growth, operating margins and the number of active users, all of which he claimed were declining.
Facebook is also battling several other suits relating to the handling of user data in the Cambridge Analytica case.
