A section of Facebook shareholders want Mark Zuckerberg replaced by ‘independent’ chairman

A section of Facebook stakeholders are calling for removing founder Mark Zuckerberg from the company’s board of directors. Claiming that an independent chairperson would be better suited to the task, a group of Facebook shareholders that are also part of consumer watchdog group SumOfUs, have called for a change at the highest level of the hierarchy.

In their proposal, the shareholders claim that an independent chairman would be able to,

better oversee the executives of the company, improve corporate governance, and set a more accountable, pro-shareholder agenda.

The proposal also gives an example wherein last year, changes to the nature of Facebook stock and to company rules were made so as to further strengthen Zuckerberg’s grip on the company. The proposals were approved and class “C” shared issued for the Facebook CEO. It was also ensured that he could remain in control of the company, even while holding any government office indefinitely. A litigation brought on by a shareholder was involved back then as well.

Well, the proposal might have gained more wind had it had some other company and some other executive within its sights. With Facebook and Mark Zuckerberg though, such a change is extremely hard under the present circumstances.

For one, Facebook is doing as well as ever. Sure, last year got a little bumpy near the end as the company got swamped with fake news, news that was later blamed for said to have a hand in Donald Trump’s election as the president of the United States. However, the company has already put that behind it and at its latest earnings call, it managed to beat analyst expectations yet again.

The proposal does call out last year’s happenings though, calling out for a new face at a time when the company:

faces increasing criticism regarding its perceived role in the promotion of misleading news; censorship, hate speech and alleged inconsistencies in the application of Facebook’s community standards guidelines and content policies; targeting of ad views based on race; collaboration with law enforcement and other government agencies; and calls for public accountability regarding the human rights impacts of Facebook’s practices

And then there is Mark Zuckerberg’s own status with the company. Not only is he the CEO and a director, he is also one of its largest shareholders. As such, even if such a proposal makes its way to the company, he can easily veto it along with a couple of allied shareholders.

The shareholders seem well aware of the enormity of the task they have undertaken. As one of them puts it:

This shareholder resolution, like most shareholder resolutions, is advisory in nature. There could be a 99 percent vote in favor of it and the board would not be under legal obligation to implement it.  However, most competent board members realize that it is unwise to ignore the voice of the shareholders whose interests they are charged with representing.

Wow, that almost sounded like a very polite threat. Meanwhile, Facebook is likely to respond when it makes its proxy filings in April.